Congress investigates telecom companies over US internet assistance program

Congress investigates telecom companies over US internet assistance program

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A top congressional committee on Wednesday opened an investigation into AT&T, Charter, Dish Network, T-Mobile and Verizon, seeking to determine whether those telecom giants and others are “following the law.” in administering a federal assistance program that helps low-income families stay online.

The probe — launched by Rep. Frank Pallone Jr. (DN.J.), chairman of the House Energy and Commerce tech-focused committee — follows a Washington Post investigation that found internet service providers had triggered price increases, speed reductions and fraud risks related to the pandemic-era initiative.

The in-depth review focuses on the roughly $17 billion passed by Congress since 2020 to help cash-strapped families and bridge the nation’s digital divide. First called the Emergency Broadband Benefit, then last year renamed the Affordable Connectivity Program, the initiative pays benefits directly to telecommunications providers to reduce qualified Americans’ monthly bills, sometimes to zero.

The aid has helped more than 14 million households to reduce their costs, although registrations reflect around a quarter of the roughly 49 million households eligible for aid. The discrepancy is partly due to telecom providers, whose tactics are laid bare in thousands of consumer complaints – and tons of other data – that The Post has obtained under the Freedom of Speech Act. information.

In response to the findings, Pallone wrote to 13 companies on Wednesday, noting that he was “deeply concerned” that some “may not meet program requirements.” The president added that the allegations reflect “actions that are now explicitly prohibited by Congress and the FCC.”

And Pallone asked for details on the administration of broadband benefits by internet service providers. Questions included how many people they serve, how they market their Internet offerings, and what complaints they have received from harmed customers. Pallone also inquired about their billing practices and monitoring mechanisms, including the extent to which agents receive commissions on sales.

“The success of the current program, ACP, is critical to advancing our common goal of connecting all Americans,” Pallone wrote, asking for responses by Nov. 9.

In separate statements, AT&T and Verizon acknowledged receipt of the letters and said they would respond accordingly. They each underlined their commitment to the federal program. Charter pointed to his earlier comments, which touted his own efforts to promote the benefits of government broadband. Dish and T-Mobile did not immediately respond to requests for comment.

The Covid Money Trail

It was the biggest burst of emergency spending in US history: two years, six laws and more than $5 trillion intended to break the deadly grip of the coronavirus pandemic. The money has spared America’s economy from ruin and put vaccines in millions of weapons, but it has also invited unprecedented levels of fraud, abuse and opportunism.

In a year-long investigation, the Washington Post is following the covid money trail to figure out what happened to all that money.

Read more

Pallone’s letter reflected a broader and ongoing challenge facing the US government as it sought to closely monitor the more than $5 trillion in emergency spending enacted since the start of the pandemic. The money helped save the economy from free fall, but it remained difficult to track and prone to waste, fraud and abuse, The Post revealed in The Covid Money Trail, a year-long series . This includes a wide range of wasteful spending that has since come to the attention of federal inspectors general.

Complaints about government internet subsidies date back to the early days of the program, when it was known as the Emergency Broadband Benefit. Many consumers told the Federal Communications Commission from early 2021 that telecom giants, including AT&T, Charter and Verizon, forced them to make undesirable choices – accepting price hikes, speed reductions or other plan changes if they wanted to apply the federal benefit to their bills. .

In response, AT&T attributed some of the problems to “technical challenges” compounded by the speed with which Washington implemented the benefit program. Charter said it had been clear with customers and got “meaningful input”, while Verizon acknowledged changing its policies amid public backlash.

Meanwhile, broadband benefits have quickly become a source of potential fraud, The Post found. The telecommunications giants’ race to sign up subscribers — in addition to long-known problems in the government’s application system — has opened the door for potentially tens of thousands of people to get federal aid they don’t want. were not eligible.

Much of the problem involved approximately 200,000 families receiving monthly internet benefits after claiming to have a child attending a very poor school. More than 143,000 of those recipients registered for stipends on behalf of a student whose name they never provided, according to data obtained by The Post. Nearly 20,000 applicants – some included the children’s names, some did not – also named a school 50 miles or more from their home.

Some of the biggest fraud risks involved Dish-owned low-cost carrier Boost Mobile, which enrolled 11,000 student-based families attending distant schools — including more than 400 students who lived thousands of miles away. Presented with The Post’s findings, a Dish spokesperson said Boost Mobile services were offered by “independent third-party outlets”. He added that the company has been working to improve its processes with the FCC.

The telecommunications agency moved quickly to tighten eligibility as the FCC inspector general issued a series of pointed warnings about the risks of waste, fraud and abuse. On Capitol Hill, meanwhile, Democrats and Republicans have sought to rethink their broadband benefits as part of a $14 billion effort called the Affordable Connectivity Program. The changes, overseen by the Biden administration, have helped clamp down on abuse and spurred more signups. But they still opened the door to new headaches that consumers quickly raised with the FCC.

In many cases, lesser-known low-cost carriers have come to see the money as a business opportunity — and some have adopted questionable marketing tactics to sign up new subscribers. A discount brand owned by T-Mobile called Assurance Wireless has repeatedly enrolled families for federal benefits in a way that then led those customers to complain to the FCC, according to documents obtained by The Post. In some cases, they told the agency, the company’s tactics had the effect of diverting a consumer’s benefit from another provider where they had hoped to apply the monthly rebate, leaving them on the hook. for an invoice.

In a statement, Tara Darrow, a spokeswoman for Assurance and its parent company, T-Mobile, said there were “no instances where a customer could be enrolled in these programs without their permission.”

On Wednesday, Pallone acknowledged that “many issues have been resolved” since the US government began offering the benefits of broadband during the height of the pandemic. He also commended the telecommunications companies for their participation in a voluntary program. But he pledged to step up monitoring ahead, stressing that he would ensure they “meet safeguards and consumer protection standards”.

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