Hanging Up on Fraud

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We live in a day and age when wireless devices outnumber the U.S. population. Even though we are more connected than ever, we tend to take communication for granted and forget that millions of low-income people can’t afford phone service. The Federal Communication Commission’s (FCC) Lifeline program exists to keep those, who qualify for the federal benefit, connected to their families and community. (Where there is a federal benefit, fraud is always a potential problem.) An article on the website, RealChangeNews.org, reports that the program is planning to launch an online database in the spring to eliminate duplicate subscribers and reduce inefficiencies along with fraud, waste and abuse.

The story reports that more than 15 million people currently benefit from the Lifeline program. Since new regulations and guidelines have been enacted, more than 500,000 duplicate subscribers have been crossed off the list. The new database, which is scheduled to launch in the spring, is projected to help the FCC save more than $2 billion by the end of 2014.

To meet eligibility requirements, Lifeline beneficiaries must either be at or below 135 percent of federal poverty guidelines or participate in a federal assistance program such as Medicaid, Section 8 public housing assistance or the Supplemental Nutrition Assistance Program (SNAP). If the potential subscribers qualify, they receive one prepaid phone with 250 minutes of free service per month. Mobile phone companies receive a subsidy of $9.25 per month per phone for service.

Fraud enters the picture when subscribers have duplicate phones and wireless companies receive multiple subsidies. (The government takes this type of fraud seriously.) The article states that the FCC recently fined two wireless companies $44 million for having duplicate Lifeline subscribers.

In the broadband reality of today, it is essential to have universal access to communications technology. Since Lifeline’s inception in 2005, the number of low-income people benefiting from the program has risen from 80 percent to 93 percent. Now, everyone, regardless of income, can make a call or access the Internet just about anywhere and at anytime. Low income families don’t have to choose between feeding their families and going without a dial tone. Now they can be assured of having a connection to services that can help them to have a better future.

Source: Today’s ”Fraud of the Day” is based on an article titled, ”FCC Launches Database to Crack Down on Fraud in Free Cellphone Program,” written by Rosette Royale and published by RealChangeNews.org on January 8, 2014.

A federal program that provides free prepaid mobile phones to low-income people will launch an online database this spring to eliminate duplicate subscribers.

This March, the Federal Communications Commission (FCC) plans to fully institute a subscriber database to help eradicate fraud in its Lifeline phone program. The database to identify duplicate subscribers is part of an ongoing effort to cut waste and abuse.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.