Fraud Reported in FCC’s Emergency Broadband Program; Agency Asks Industry How to “address provider misconduct”

By B.N. Frank

The Federal Communications Commission (FCC) has been identified as a “captured agency” for catering to the telecom and cable industries for decades (see 1, 2). This has led to numerous lawsuits filed against it including one that determined it had allowed telecom and cable companies to overcharge Americans for decades (see 1, 2). Despite the lawsuit, the overcharging has continued and recently led to additional government funds being allotted for telecom purposes via the Infrastructure Bill (see 1, 2, 3) and earlier in the year for the Emergency Broadband Benefit (EBB). According to recent report, the “captured agency” is being scrutinized again.

From Fierce Telecom:

FCC OIG report flags fraud in Emergency Broadband Benefit program

The Federal Communications Commission (FCC) is taking steps to verify that households participating in its Emergency Broadband Benefit (EBB) program are in fact eligible for support, after the agency’s Office of Inspector General (OIG) flagged several instances of obvious fraud.

When it launched the EBB, the FCC determined households with a student enrolled in certain eligible schools or districts would qualify for the broadband subsidy. However, OIG warned in a memo issued this week that enrollments tied to this criteria have led to abuse of the program.

“In short, there are many more EBB-enrolled households that claimed they have a dependent child at certain CEP schools than students who are actually enrolled in those schools,” the memo stated.

For instance, OIG said 1,884 households signed up for the EBB claiming eligibility through a school in Florida which actually only has 200 students. In another example, it noted 952 households in Arizona were enrolled in the EBB through their connection to a school with only 90 students.

OIG said its analysis found “dozens of CEP schools across the nation are overenrolled only six months into the EBB program,” with many others showing “suspiciously high rates” of EBB enrollment.

The watchdog pointed the finger at providers as the source of the issue, stating operators participating in the program “incentivize sales agents to maximize enrollments by providing commission-based compensation.” It argued this has led to a recurrence of fraud and abuses which were once rampant in the FCC’s Lifeline subsidy program.

In response to the memo, the FCC said it will now require households looking to sign up for the program to provide documentation demonstrating that a student who lives there is enrolled in a qualifying school. It will request the same from existing program participants to confirm their eligibility.

The FCC added it will look to recoup any funds which were distributed to unqualified households and will refer bad actors to its Enforcement Bureau.

As of November 21, a total of 7.86 million households were enrolled in the EBB. Thus far, $856.7 million of the $3.2 billion allocated to the program has been distributed.

The news comes as the FCC works to transition from the EBB to the new Affordable Connectivity program (ACP) created by the recent Congressional infrastructure bill. The agency recently called for industry input on how to implement the ACP, among other things asking how it should address provider misconduct.

In regard to other lawsuits filed against the FCC, a few months ago, a federal court ruled in favor of claimants that proved the “captured agency” has failed to protect the public from unsafe levels of cell phone and wireless Wi-Fi radiation. Additional lawsuits have also been filed against it for allowing the deployment of controversial 5G technology on Earth (see 1, 2, 3, 4, 5) and in space (see 1, 2, 3).