FCC proposes $44 million in new penalties for Lifeline program violations

The U.S. Federal Communications Commission (FCC) has proposed more than $44 million in new monetary forfeitures against three wireless Lifeline service providers who allegedly established multiple Lifeline wireless phone service subscriptions for individual consumers, in violation of the program’s rules.

The Commission issued Notices of Apparent Liability (NALs) in December 2013 against Cintex Wireless ($9.4 million), Telrite Corporation ($22.4 million) and Global Connection ($11.7 million). In each instance, the Commission says that the carriers knew or should have known that targeted consumers were already participants in the Lifeline program, and therefore ineligible for multiple subscriptions under Lifeline program rules.

The proposed monetary forfeitures were based on the number of unlawful payment requests made by each respective carrier, which was then adjusted upward by three times the total duplicate payments requested.

Established in 1985, the Lifeline program provides discounted wireless service subscriptions to low-income consumers. However, evidence of widespread abuse led the Commission to overhaul the program in 2012, and to aggressively pursue investigations of duplicate service and fraud. During the last three months of 2013 alone, FCC enforcement in connection with Lifeline program violations has resulted in proposed fines of $90 million.