FCC Opens Probe Into Sprint, Accuses It Of Receiving Millions Of Dollars Meant For Low-Income Program

Sprint allegedly received millions of dollars meant to subsidize phone service for low-income consumers, according to the Federal Communications Commission.

FCC chairman Ajit Pai said in a statement that the ploy was a “careless disregard” for taxpayers and commission rules.

“It’s outrageous that a company would claim millions of taxpayer dollars for doing nothing,” he said in a press statement Tuesday.

The FCC’s Lifeline program, which Sprint allegedly misused, offers a $9.25-per-month subsidy for most low-income consumers. FCC added a limit to prevent misuse of funds in 2016 under former chairman Tom Wheeler. The rule change required cell phone providers to drop customers if they don’t use their service for 30 days.

Sprint failed to abide by that rule for 885,000 subscribers, the FCC stated, which represents about 30% of Sprint’s Lifeline customers and nearly 10% of all Lifeline subscribers.

Sprint told reporters the payments were made in error and the company is “committed to reimbursing federal and state governments.”

“When the error was discovered, we immediately investigated and proactively raised this issue with the FCC and appropriate state regulators,” Sprint spokeswoman Lisa Belot told the Daily Caller News Foundation. “We also engaged an independent third party to review the results of our review and the effectiveness of our operational changes.”

FCC has tackled similar problems in the past. FCC Commissioner Brendan Carr said he believes revenue from Educational Broadcast Service (EBS) licenses, which are intended to provide broadband access to schools, might be going to political causes. He wants the EBS system to be used freely with the buildup of fifth generation broadband.