Sprint Took FCC Cash For Serving 885,000 People It Wasn’t Actually Serving

An anonymous reader quotes a report from Ars Technica:

Sprint has been caught taking millions of dollars in government subsidies for “serving” 885,000 low-income Americans who weren’t using Sprint service, the Federal Communications Commission said today. Sprint violated the Lifeline program’s “non-usage rule” that requires providers of free, subsidized plans to de-enroll subscribers who haven’t used their phones recently, the FCC said. “It’s outrageous that a company would claim millions of taxpayer dollars for doing nothing. This shows a careless disregard for program rules and American taxpayers,” FCC Chairman Ajit Pai said. “I have asked our Enforcement Bureau to investigate this matter to determine the full extent of the problem and to propose an appropriate remedy.”

Sprint has admitted the mistake and said it will pay the money back. Like the FCC’s other universal service programs, Lifeline is paid for by Americans through fees imposed on phone bills. The FCC said Sprint’s violation “initially came to light as a result of an investigation by the Oregon Public Utility Commission.” Because of that investigation, the FCC said it “has learned that Sprint Corp. claimed monthly subsidies for serving approximately 885,000 Lifeline subscribers, even though those subscribers were not using the service.” The 885,000 subscribers that Sprint wasn’t actually serving “represent nearly 30% of Sprint’s Lifeline subscriber base and nearly 10% of the entire Lifeline program’s subscriber base,” the FCC said.

The FCC didn’t say exactly how much money Sprint received through its violation of the non-usage rule, but one month’s worth of $9.25 payments for 885,000 subscribers would amount to $8.2 million.

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