FCC Fines Carriers Too Many Free Cell (Obama) Lifeline Phones 4 Low-Income

lifelineFederal Communications Commission y proposed $32.6 million in fines against three companies that
apparently violated program rules for the lifeline program.  Protestors called these phone Obama phones, however low-cost/free cell phones have been proven to help people find jobs and recover in the down economy.

Previously the FCC fined other Lifeline providers $14.4 for violations and over-billing. Last year, the FCC created new rules that required Lifeline carriers to certify that Lifeline subscribers are eligible.  In fact, when free cell phones for low-income people came to California for the first time, it clearly stated that you can not received the service if you already have a discount on your landline.

The are many free cell phones for low-income customers in other areas read our how-to article.

FCC investigations showed that the companies did not limit Lifeline subscriptions to one subscriber per household, and received payments for thousands of consumers that already were obtaining Lifeline service from the same company.

In each case, the carrier knew or should have known, based on internal data, that the consumers were
ineligible because they were already receiving service from that carrier. The penalties proposed in
today’s NALs are in addition to full recovery of the universal service funds paid to the carriers for
duplicative Lifeline service.

Notices of Apparent Liability NALs, were issued against:

  •  Conexions Wireless – $18.4 million for apparent violations over the course of eight months in Arkansas, Maryland, and West Virginia.
  •   i-wireless LLC – $8.8 million for apparent violations over seven months in Ohio, Illinois, North Carolina, Tennessee, West Virginia, New York, Indiana, and South Carolina.
  •   True Wireless – $5.5 million for apparent violations over eight months in Arkansas, Maryland, Oklahoma, and Texas.

The FCC also proposed a penalty of $300,000 against Conexions for its apparent willful and repeated
failure to provide timely and complete responses to the FCC’s requests for information, noting that
Conexions’ conduct delayed and impeded the Bureau’s investigation.

Since it was launched in 1985, Lifeline has helped ensure that low-income consumers can afford basic
telephone service by providing monthly service discounts from the FCC’s Universal Service Fund.

The FCC’s Enforcement Bureau has worked aggressively to enforce these new rules since their adoption,
taking actions worth over $15 million, in addition to today’s $32.6 million in proposed forfeitures.
Numerous additional investigations are ongoing.