Telecommunications Fraud

The United States provides money to telecommunications companies for services pursuant to a number of different laws, grants, contracts and federal programs. Unfortunately, these businesses have also defrauded the United States at times. Below, we highlight the types of fraud discovered in this industry and detail how you can report telecommunications fraud when you discover it. The False Claims Act permits whistleblowers to bring a qui tam lawsuit to report evidence of fraud to the government and share in the recovery.

Businesses in the telecom industry have engaged in a number of different fraudulent schemes. Here are a few examples:

Wiretapping and Surveillance Costs

The law permits telecommunication companies to recoup certain costs from the government for wiretaps and other surveillance requests made by law enforcement agencies. A recent complaint brought by the Department of Justice against Sprint alleged overbilling of the DEA and FBI for its costs. Given plans for

Stimulus Grants for Broadband Services

As part of the American Reinvestment and Recovery Act, the National Telecommunications and Information Administration and the U.S. Department of Agriculture’s Rural Utilities Service received $7 billion in economic stimulus funds to expand broadband services in the United States. The Broadband Initiatives Program and the Broadband Technology Opportunities Program distributed this money to businesses through grants funding the expansion of high speed broadband internet services to rural areas. At least two companies accepting grants under these programs have been charged with misconduct.

IP Relay Fraud

The FCC IP Relay Program provides compensation to service providers assisting hearing and speech impaired individuals with phone calls. The companies are reimbursed on a per-minute basis for their help. AT&T settled a lawsuit with the DOJ in 2012 related to payments it received under this program.

Defense Contracts

Telecommunications companies provide a variety of communication services to the United States military under contract, including broadband internet, radio and satellite communications. Misconduct related to these contracts also implicates the False Claims Act.

How to Report Fraud

The False Claims Act provides individuals with a federal cause of action when they wish to report fraud against the United States and share in the recovery. If money is successfully recovered on behalf of the government, an eligible whistleblower may receive between 15 and 30 percent.