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Wall Street Journal’s Spencer Ante on allegations of fraud and government waste in the government program that provides free phones to the poor.
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I'd -- a shift gears right now though.
Because -- money update on a story that will make -- want to slammed down the phone on government waste.
An investigation into the government program that.
Gives free phones to -- -- -- telling you about this because you're paying for it and almost half the participants.
Are scamming you.
All of us that he get there a landline or cell phone or both.
Were all being charged monthly to support the program called lifeline and the federal communication commission which.
Is conducting the investigation they've already found that nearly 41%.
Of this six million lifeline subscribers can't even show that they need -- basic requirements for enrollment.
That's just.
-- -- Spencer -- who reported this story.
Wall Street Journal is back with more of the outrageous allegations appreciate you joining us and how can 41%.
Of people who don't even qualify for program that legitimately has good intentions actually gonna -- would.
Right what's -- -- -- we don't know if they were actually -- what we do know is that they either didn't respond to the request for certification.
Of countries actually could still be eligible but they couldn't be reached -- a lot of these people homeless crack or they weren't eligible but we're looking at for instance Florida.
Wisconsin and Oklahoma are conducting their own investigations what they're finding.
Is that some of the phone companies which are part of lifeline and we're going to hospitals to sign up people who would not have been eligible is that not accurate.
Yes IE basically did a follow.
Story to our initial story which reported the 41% figure -- and we started looking.
The potential fraud in the program.
And what we found is that a lot of state public service commissions have been looking into some of these companies and the finding some strange things in some cases so.
In the case that you mentioned in Wisconsin.
A public service commission.
Looked into a company called mid western telecommunications or incorporated and what they found -- their investigation.
Is that they were getting applications from children.
Okay which are not allowed to be part of the it's what they want one phone per household correct actually that's -- one phone per household.
There's another company in Alaska called Alaska did you tell and what they found the department justice investigated them.
And they saddled with the DOJ.
For all a million and a half dollars that's it and just a million and a half.
The what they found their investigation is that.
This company hired a marketing company because -- in this fierce competition for these lifeline subscribers and that company actually.
Went to hospitals.
-- he would sign that patience.
And inserted hospital address this as -- address which is not allowed.
Is what seems to be the problem with this program each of us take your -- your phone relative to dollar and fifty cent -- -- -- -- universal service -- -- eight good intentions because people who might be down on -- lot gore meet the requirements need access to employers who have found get.
But these are people who don't need access to -- in fact let's play that famous sound bite everyone remembers Obama -- let's just remind you about some people who have these phones.
And it got Obama -- I got a problem and -- -- black man.
You know -- but the bottle did little car but he didn't -- -- and have been -- you'll bulls fans love thousand Jack didn't give it had no payment on.
Now these phones and by the way I should point out -- -- -- city I -- because I lived there for eight years.
These phones are intended for people who might be on disability for people who can't afford to use the phone.
The incentive is for these companies to sign up as many people is they -- because it doesn't look it was only last year that they started to look.
To request who's getting the phone but why did they wait so long to look at who's getting the funds -- been around several years.
-- well I just wanna correct one thing I know there's a lot of talked about the Obama found the program was actually created under Ronald Reagan -- expanded under bush and it continues under.
The Obama administration.
Why did it take -- long -- a good question FCC actually began looking into this in 2010 -- -- because government doesn't work.
The record inflation -- it took them about a year and a half for two years actually pass the reform -- so -- passive.
In the beginning of 2012 moved so took them awhile to get to that point.
People are saying that the reforms are working with the sorry to weed out a lot of these analysts -- apple that's odd million dollars in savings they they say they say in the next three years that could save a -- two billion dollars but it's still early in the process.
And we don't know if they're gonna actually get to that number.
One thing that I've actually tried to do is find that woman who was in that famous sound -- because she may actually qualify for one of these GMAC has anybody ever tracked her down since that -- hot bat an -- -- I have not tried to track her down but maybe that's of another follow sort for a summit at which point out though that when people are getting away with a -- that they shouldn't happen it's tonight someone who needs the phone.
The ability to get that well.
A lot of the criticism that these stories are raising is that some of the one of the questions as being racist should there be a cap on this program there are other programs that -- that come -- -- universal service speak their caps.
The low income program which -- as part of is only one of the universal -- these problems that are not cap.
So that's one thing to be discussed all right Spencer on they would appreciate your being and I know this is going to be a story that continues to go back to you all the best -- --
