Report reveals massive fraud in Obamaphone program


A new report from the Government Accountability Office (GAO) has revealed that nearly two-thirds of all Obamaphone recipients received their free government-issued phone service by falsifying their applications. 

GAO undercover investigators carried out a sting operation by applying for the free phones using criteria that should have rendered them ineligible. However, what they discovered is that ineligible applications were approved 63 percent of the time, as reported by The Daily Caller.

A review also exposed that between 36 to 65 percent of beneficiaries had outright lied on their applications, which should have been detected by those screening them, but instead the bogus applications were approved.

“We were approved to receive Lifeline services by 12 of the 19 Lifeline providers using fictitious eligibility documentation,” said the undercover investigators.

During the course of its investigation, the GAO determined that the Federal Communications Commission (FCC) passed off the responsibility of screening for eligibility to phone companies, which earn profits based on the number of people they sign up to enroll in the program.

Basically, all applicants needed to do was claim to be enrolled in another welfare program, such as food stamps or disability (SSI), in order to get approved. It was found that “only 35.5 percent of people claiming eligibility based on SSI could actually be confirmed as eligible,” according to the 90-page GAO report.

That means 64.5 percent of people lied on their applications and may not be considered low-income.

The FCC failed to check government databases to confirm whether applicants were actually enrolled on SSI, nor did it check that phone companies were complying with proper screening procedures.

Meanwhile, phone companies aggressively targeted low-income housing projects in vans with neon flashing lights to attract the attention of potential applicants.

Some representatives strategically placed themselves outside of welfare offices. One woman even claimed she was approached by a phone company representative in front of a welfare office, who tried to convince her to sign up her two-year-old child.

GAO investigators who analyzed the data found “a total of 5,510 potential internal duplicates whereby the last name, first name, date of birth, and last four digits of the SSN of one record matched another record exactly,” GAO wrote.

Additionally, over 6,300 recipients were in government databases that showed the phone recipient as being deceased.

The FCC’s own data shows that “millions of Lifeline-eligible households are obtaining voice service without Lifeline,” while the fraud rates show that many of the people who do sign up are wealthier than those who don’t.

“While some academic studies have raised questions whether Lifeline is a costly and inefficient means of achieving universal service, FCC has not evaluated the program to determine whether it is efficiently and effectively meeting its goals, as we recommended in our March 2015 report,” GAO chided.

As it stands, the FCC has declined to assess whether the program provides phones to low-income citizens in the face of recent negative audits. Instead, it’s actively seeking to expand the program to include free Internet service.

You may recall the YouTube video that went viral during the 2012 presidential campaign, in which a woman pledged to vote for Obama because “he gave us a phone,” adding that “everybody in Cleveland low minority got an Obamaphone.” Saturday morning, Fox’s Tucker Carlson quipped that while she is clearly a “happy customer,” the program has been rife with fraud since that time and ranks as one of the most corrupt welfare programs in the U.S., according to the GAO’s report.

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