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Thread: Government’s Free Phone Program Riddled With Abuse, Fraud

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    Government’s Free Phone Program Riddled With Abuse, Fraud




    DENVER (CBS4) - A federally regulated program providing free cellphone service and phones to the poor and needy in Denver appears to be riddled with waste, fraud and abuse, according to an undercover CBS4 Investigation.

    The $2 billion a year Lifeline program has handed out more than 13 million free cellphone plans across the country in the first six months of this year. In Colorado, the program handed out more than 117,000 free cellphone plans in the first half of this year, or about 20,000 cellphones every month.

    The free phones and their wireless plans are paid for by a monthly tax on your cellphone, called the Universal Service Tax. Although the Lifeline wireless program has been around since 2005 and started under president George W. Bush, it has exploded under President Obama’s administration and the phones are often referred to as “Obamaphones.”

    The program has strict guidelines. To qualify, you have to be on food stamps, Medicaid, housing assistance or some other government program to prove that you are low-income. The idea is that people who could not otherwise afford mobile phones would have them to help look for jobs, call 911 in an emergency or stay in touch with family members.

    But on multiple trips to Colfax Avenue and Broadway in Denver, where multiple distributors set up their tents to hand out free cellphones, a CBS4 producer and reporter found the phone agents willing to circumvent strict government rules designed to ensure that only the truly needy get the free phones. The vendors receive massive government subsidies to hand out the phones and the accompanying monthly plans.

    “Want to sign up for a free phone?” an agent representing Total Call mobile asked a CBS4 producer. The representative then asked if the undercover producer had a food stamp card, a Medicaid card or any other evidence that he qualified for a phone.

    “No,” replied the CBS4 employee. But one of the cellphone agents then ordered his colleague to “push it through,” by using someone else’s food stamp card to provide eligibility for the CBS4 employee.

    “Did you just use that guy’s food stamp card for me?” questioned the CBS4 employee.

    “Yeah,” responded the Total Call representative. “It’s verification that you are on some kind of assistance program. It’s to get you through.”
    He promptly gave the CBS4 worker a free phone. The Total Call agent said he received $3 for every phone he is able to give away.

    [....]

    But the abuse appears to be occurring on the part of phone recipients of the free phones as well. Over and over, men and women who obtained the free phones told CBS4 they were already paying for iPhones or smartphones but couldn’t resist getting a free phone, courtesy of taxpayers.

    One man told CBS4 he wanted a free cellphone but did not have a food stamp card and did not qualify. He showed CBS4 his current smartphone that he said he was paying $57 a month for. But he explained that he went across town, got a food stamp card anyway, then returned to Civic Center with a food stamp card that has no money on it, but was still able to use it to qualify for an “Obamaphone.”

    “Completely free. I didn’t pay a dollar, not a dime, not a nickel,” said the man. “That’s what everybody calls them in the ‘hood, Obamaphone,” laughed the man.
    I had no idea about this program back in '05, and if I had, I would have raised holy hell about it. I had dim knowledge of the old landline program back in the '80s, and while I think the reasoning is a little stretched, it's still something I can live with. But this? HELL no. If you're so broke that you can't feed or house yourself, and you need a phone to look for a job, then you need to sit your ass at home and work the phone from the one bolted to the wall, not out traipsing around with a cell phone.

    I've said it numerous times before, but it bears repeating again here: making people comfortable in their poverty simply traps them in that same poverty.



    I thought I remembered something from before about massive fraud with Obamaphones (if the people using them are calling them that, then that's what they're going to get called, so stop whining about it), and I was right. When Claire freaking McCaskill is supposedly upset about a big waste in a government freebie program that shouldn't even exist, then it's gotten pretty bad.

    The last paragraph says that the FCC was supposed to be setting up some sort of database to cross-check the people to find out if they are double-dipping. This allegedly went online on January 14 of this year. It seems pretty clear with today's report out of Denver that this is not actually effective in stopping people from getting Obamaphones that they shouldn't.
    Leftists have unquestionably demonstrated their hatred for due process, and Democrats have undeniably obstructed justice for, and thoroughly victim-shamed and smeared, Karen Monahan.

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    Quote Originally Posted by Adam View Post
    I had no idea about this program back in '05, and if I had, I would have raised holy hell about it. I had dim knowledge of the old landline program back in the '80s, and while I think the reasoning is a little stretched, it's still something I can live with. But this? HELL no. If you're so broke that you can't feed or house yourself, and you need a phone to look for a job, then you need to sit your ass at home and work the phone from the one bolted to the wall, not out traipsing around with a cell phone.

    I've said it numerous times before, but it bears repeating again here: making people comfortable in their poverty simply traps them in that same poverty.



    I thought I remembered something from before about massive fraud with Obamaphones (if the people using them are calling them that, then that's what they're going to get called, so stop whining about it), and I was right. When Claire freaking McCaskill is supposedly upset about a big waste in a government freebie program that shouldn't even exist, then it's gotten pretty bad.

    The last paragraph says that the FCC was supposed to be setting up some sort of database to cross-check the people to find out if they are double-dipping. This allegedly went online on January 14 of this year. It seems pretty clear with today's report out of Denver that this is not actually effective in stopping people from getting Obamaphones that they shouldn't.
    First of all, the Obamaphone name, iirc, was popularized by a utube of a Black woman at an Obama rally talking about what he was going to do for her. She called it the Obamaphone.

    Eventually, some of the sites that were involved with LifeLine adopted Obamaphone for a time, then eventually, pulled the name when called on it.

    One thing that isn't mentioned is, the phones are basic phones and are purchased by drug dealers from the applicant and used as throwaways.

    If you look up the stats, Sprint is making a killing off of this program. They operate several different companies that are wholly owned by Sprint that 'administer' the LifeLine program.

    Sprint doesn't buy the phones, all they have to do is allow them to connect to the Sprint network, at the lowest levels (don't think high speed or anything like that, it is sub 3g from what I understand) for something like 200 voice minutes a month and collect a nice gubment check for each one that signs up.

    So, we have Sprint, a supposedly US cellular company, that is owned by a Japanese company, that is making a goodly amount of money for doing virtually nothing except hand out free phones that they pay nothing for.
    Robert Francis O'Rourke, Democrat, White guy, spent ~78 million to defeat, Ted Cruz, Republican immigrant Dark guy …
    and lost …
    But the Republicans are racist.

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    I have occasion to drive by the intersection of Colfax and Sheridan maybe 2 or 3 times a month now. Since last May, I have seen the Obamaphone tent up more than half the time. They have large signs advertising "free phones". It's good location since there are bus stops on all 4 corners, a huge pawn shop one corner and a bar and a Walgreens on 2 others.

    The area itself is mostly Hispanic with some section 8 housing used by blacks who were moved when the projects east of there were torn down. They seem to do a lively trade.

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    Well, an update. USAToday or Daily Caller, take your pick. They both say essentially the same thing: this GAO report (90-page .pdf) shows that up to about two thirds of all people getting these phones are not actually eligible for varying reasons: they're not actually poor, they're dead, they already have a phone through another carrier, they don't actually exist, etc.


    This thing just needs to be killed off entirely. Give people who are verifiably poor a landline that is bolted to the wall where they live. Track down as many of these fraudulently-obtained phones as possible and charge those people for fraud and lock them up. Tell these cellular companies that they're going to get fined $1000 for every single case in which they didn't verify the eligibility of the person getting the phone.
    Leftists have unquestionably demonstrated their hatred for due process, and Democrats have undeniably obstructed justice for, and thoroughly victim-shamed and smeared, Karen Monahan.

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    Quote Originally Posted by Adam View Post
    Well, an update. USAToday or Daily Caller, take your pick. They both say essentially the same thing: this GAO report (90-page .pdf) shows that up to about two thirds of all people getting these phones are not actually eligible for varying reasons: they're not actually poor, they're dead, they already have a phone through another carrier, they don't actually exist, etc.


    This thing just needs to be killed off entirely. Give people who are verifiably poor a landline that is bolted to the wall where they live. Track down as many of these fraudulently-obtained phones as possible and charge those people for fraud and lock them up. Tell these cellular companies that they're going to get fined $1000 for every single case in which they didn't verify the eligibility of the person getting the phone.
    I totally agree with the bolded. I have watched the cellular service reps sit at tables in downtown Oakland and solicit people by barking "Free phones!" I assume the company gets paid by government for whatever charges the people run up.

    I've heard them do the spiel when someone shows interest. There's no mention of qualifying. I'm sure there are people accepting these phones who truly believe they're poor enough to qualify, and are never asked for proof of eligibility. I can't see charging them with fraud. If someone is going around getting one from every outlet and then selling them or handing them out to "employees" (I'm thinking drug delivery and prostitution), prosecute the hell out of KNOWING frauds.

    I find it very interesting that none of them has ever offered me a phone, even when I come into the office in old jeans. They seem to target the very young (teen moms, mostly) and the elderly and/or obviously disabled.

    The landline thing won't work. The whole idea behind these phones is for people who are poor and looking for work to have a way for potential employers to contact them. These people have no place to hang a landline. They may be living in a shelter (yeah, having the phone answered, "St Benedict Labre's Shelter" is guaranteed to make an impression), couch surfing, living in their cars, or even temporarily on the street.

    I knew one underemployed guy who slept in his car but kept up his $25/month basic gym membership because that way he had a place to shower and shave and change clothes, so he didn't lose the job he had, and could look for a full-time job.

    One of the security guards in our office building is living in his van with his wife and 2 little kids. He works as many hours as he can get. They've been on the list for low-income housing for over a year. They shower at friends' houses or occasionally at a shelter. He's looking for a second job. Without a cell phone, the chances of a prospective employer reaching him are slim.
    No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any state deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws. This offer VALID in 35 34 33 32 31 26 20 17 15 14 13 ALL 50 states.

    The new 13 original states to stand up for freedom: CA, CT, IA, MA, DE, MN, NH, NY, RI, VT, ME, MD, NJ (plus DC).

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    Quote Originally Posted by Celeste Chalfonte View Post
    I knew one underemployed guy who slept in his car but kept up his $25/month basic gym membership because that way he had a place to shower and shave and change clothes, so he didn't lose the job he had, and could look for a full-time job.

    One of the security guards in our office building is living in his van with his wife and 2 little kids. He works as many hours as he can get. They've been on the list for low-income housing for over a year. They shower at friends' houses or occasionally at a shelter. He's looking for a second job. Without a cell phone, the chances of a prospective employer reaching him are slim.
    These folks need phones and I don't want to see them not have one!

    I've heard of people moving into my town that are no longer able to get a land line phone as they are simply not available due to wiring or other infrastructure issues. They are being offered internet based phones, but they have no internet.

    Many years ago I worked for Ameritech (formerly IL Bell) which then merged with SBC, then merged again with AT & T and we had several life line land line customers and the cost of land line installation was often more costly then a couple years of basic cell phone service depending on the installation requirements. (new jacks, network interface, etc)

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