Obamaphone program: Dialing for fraud?
An activist contends the FCC's Lifeline benefit, which aims to help low-income Americans pay for a phone, is widely abused.
The so-called Obamaphone project has a noble goal to help low-income Americans pay for mobile phones, allowing them to have contact numbers for job interviews or to access emergency services.
But now conservative activist James O'Keefe is alleging that the program is prone to fraud. Undercover cameras taped salespeople telling applicants for phones under the Federal Communications Commissions' Lifeline program that once they get a device, they can do whatever they want with it, including selling it.
One employee at a Stand Up wireless location in Philadelphia looked the other way when an undercover actor said he was going to sell the phone for heroin. "Hey, I don't judge," the employee said.
At another location, a saleswoman in an outdoor tent operated by Stand Up Wireless told an actor to take the phone to a pawn shop to find out its worth. One undercover actress told a salesperson at a TerraCom store that she wants to sell the phone to buy an "awesome pair of shoes."
It's the latest investigation into unethical behavior from O'Keefe, who drew national attention in 2009 when he taped workers at Acorn offices appearing to give advice on how to sidestep the authorities when engaging in illegal behavior, such as tax evasion and prostitution.
The Obamaphone program isn't cheap. Lifeline cost $2.2 billion last year, up from $819 million in 2008, according to The Wall Street Journal. The program is subsidized by U.S. taxpayers, who pay an average monthly fee of $2.50 per household on their phone bills to support it.
O'Keefe's investigation has hit upon a benefits program that already has no lack of detractors. (The term Obamaphone is actually a misnomer, since the Lifeline program started in 1984 under President Ronald Reagan.)
More than 40% of the low-income customers enrolled via the top five Lifeline carriers -- which include AT&T (T) and Verizon Communications (VZ) -- either couldn't demonstrate they were eligible or didn't respond to certification requests, according to the newspaper's investigation.
Some carriers are profiting from the program, the Daily Mail reports. Global Connection, the parent of Stand Up Wireless, has taken in more than $38 million for the subsidized phones, while TerraCom Wireless has booked $168 million for its services, the publication notes.
A spokesman for TerraCom told the Mail that the salesman in the O'Keefe video would likely be fired. "We will immediately look into this matter," he said. "This kind of behavior is not acceptable, and swift action will be taken to address this situation, including the employee's termination from TerraCom."
Global Connection said it is committed to following the law.
One thing is certain: The program is facing political pushback. Sen. David Vitter, R-La., and Rep. Scott Griffin, R-Ark., told the Daily Mail they want to remove mobile phones from Lifeline, which was originally meant for landlines.
Vitter said, "The free government cellphones issue just keeps getting more outrageous."
Follow Aimee Picchi on Twitter at @aimeepicchi.
Surprise, surprise. The government program is giving out free stuff, and it is not properly administrating its program to account for costs. Nothing new here. And there is not a damn thing that any of us can do about this. Or anything else. Stop fooling yourselves.
Hey, I have an idea, maybe Congress can pass a law saying that it is illegal for NSA to monitor or tap Obama phones. They can only tap phones of people who pay for phones themselves. And why not? Dont you realize that these power mad government officials have been spitting in your face and laughing at you for decades? BECAUSE THEY CAN. BUT ONLY BECAUSE YOU LET THEM. Think about it.
Everything Obama has done is fraud laden.
Now this spit in the eye wanting to have talks with the Taliban, Please.
I think that the entire military should lay down their weapons and walk away. When we have to negotiate or talk with an enemy that has killed so many of our young boys. It is time to quit.
I will also say if the military want combat girls and Gay little boys and girls then all the folks that have balls should opt out.
The name is stupid and the program is even stupider. Wonder if it will fail or be financially segregated as His OBAMACare is!!!!!!!!
Got money you will gain better service and privacy---if not Oh Well!
It might have been a good idea if we lived in a world where there wasn't an overabundance of selfish narcissistic people walking around that are constantly trying to cheat other's and take advantage of ideas like this to benefit themselves. Too bad I guess. If only the human race wasn't a complete failure. Maybe long after the planet boot's us all off another sentient species will evolve without all the burden's of human nature and an idea like this might work. That's a stretch of course.
Big deal. It's only 2.2 Billion dollars yearly and growing. The government needs to get rid of it's big surplus of money somehow. It's not like these programs put us in debt or anything. It's these poor people who pay most of the federal income tax, you know. We should be happy to reward them with a few goodies.
PS Obama I don't have or want a Cell Phone and Life is so much better without constant connections, rudeness and accident risks!
I get to enjoy LIFE more w/o one!!!!!!!!
BTW: Obama Your dependence on technology is out of line and highly risky to all Americans!
Just look at what It has done to our children who currently cannot function with their tech toys!!
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Reports say the generous benefactor behind the huge gratuities is a former PayPal executive.
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