“An SEP,’ he said, ‘is something that we can’t see, or don’t see, or our brain doesn’t let us see, because we think that it’s somebody else’s problem. That’s what SEP means. Somebody Else’s Problem. The brain just edits it out, it’s like a blind spot. If you look at it directly you won’t see it unless you know precisely what it is. Your only hope is to catch it by surprise out of the corner of your eye.”
Douglas Adams
Much of my career has involved commenting on things that are in plain view but which few want to see and even fewer want to discuss. They would prefer to treat these things as somebody else’s problem. Examples include the following.
- Many of the mistakes that cause undercharging can also cause overcharging, so it is nonsense to suggest that looking for these mistakes is bound to increase revenues. We should be searching for mistakes in the amounts we charge because all mistakes are bad, not because we are only interested in mistakes that favor our customers.
- Wholesale fraud is a zero-sum game because any amounts lost by one business are gains for the businesses that defrauded them. It is ridiculous to expect every business to be equally motivated to collaborate in the reduction of wholesale fraud, but much of the talk about industry collaboration makes no distinction between good and bad comms providers.
- Consumers are buying products and services to protect themselves from comms frauds because they perceive the need for enhanced protection and they are not receiving this protection for free. This means some comms providers not only profit from conveying fraudulent traffic, they also seek to profit by selling methods of hiding the same fraudulent traffic from those end users who are willing to pay for extra protection. This is a conflict of interest.
It is in this vein that Commsrisk has observed US telcos have been guilty of taking government subsidies on behalf of ineligible customers year after year after year after year. Another telco was punished for abusing subsidies just a few weeks ago. And yet, for all this industry’s supposed expertise in data integrity, revenue assurance and fraud prevention, almost nobody draws any inference from this repeating cycle of behavior. Now here is a new story about AT&T agreeing not to defraud taxpayers as much as it has before. These were AT&T’s failings per the US Federal Communications Commission (FCC).
First, from at least May 2021 through December 2023, AT&T sought and received EBB or ACP funding for subscribers that were improperly enrolled in the programs. The Company enrolled 3,912 subscribers with incorrect and/or invalid identifying information by repeatedly using the same nonsubscriber benefit qualifying persons (BQP) to enroll multiple subscribers…
Second, from at least May 2021 through November 2023, 21 AT&T in-store sales representatives were associated with EBB and ACP enrollments for at least 220 subscribers that included incorrect and/or invalid BQP and customer email address information. Each of these 21 sales representatives did not obtain a unique Representative Accountability Database identification number (RAD ID). The EBB and ACP Rules require enrollment representatives to obtain a RAD ID before providing information directly or indirectly to the National Lifeline Accountability Database or the National Verifier…
Third, service providers that do not assess and collect a monthly fee after applying the ACP benefit may only receive reimbursement for offering the ACP benefit when the subscriber has used the service at least once every 30 days, or has cured their non-usage during a subsequent 15-day cure period. In October and November 2023, AT&T claimed reimbursement for 3,289 ACP subscribers despite those subscribers having more than 45 consecutive days of non-usage of the service…
AT&T has agreed to pay a USD2.3mn settlement. This figure comprises a USD1.9mn civil penalty plus the repayment of the ineligible subsidies.
I am not alone in observing this pattern of fraudulent abuse of government subsidies by US telcos. A good number of professionals have spoken to me about subsidy fraud as a consequence of reading about them on Commsrisk. However, none are willing to speak on the record. The pattern is obvious to anyone who reads the stream of output from the FCC about the over-claiming of subsidies like the Affordable Connectivity Program (ACP) and the Emergency Broadband Benefit (EBB). There have been plenty of egregious cases over the course of decades, which also makes me wonder about how many other abuses were never discovered.
There are many American readers of Commsrisk. Some work for comms providers. Others will be taxpayers. Is there no anger at these frauds always being treated like they are somebody else’s problem? The prospects for tackling fraud that affects the profits of comms providers and blights their customers are bleak if the private sector cannot even tackle the frauds their employees commit at the expense of the taxpayer.
