Man Set Up Fake ISP To Scam Low-Income People Seeking Gov't Discounts, FCC Says (arstechnica.com) 24
An anonymous reader quotes a report from Ars Technica: An Ohio man created a fake broadband provider in order to scam low-income consumers who thought they were getting government-funded discounts on Internet service and devices, according to the Federal Communications Commission. In a Notice of Apparent Liability for Forfeiture released Friday, the FCC proposed a fine of $220,210 against alleged scammer Kyle Traxler. Traxler created an entity called Cleo Communications that sought authorization to be a provider in the FCC's Emergency Broadband Benefit (EBB) program, which provided $50 monthly discounts on Internet service and discounts for devices. "Cleo apparently existed for the sole purpose of taking financial advantage of customers under the disguise of being a legitimate EBB Program provider," the FCC notice said. "Cleo Communications has had no business activity outside of the EBB Program and no other business purpose."
The FCC began investigating after receiving complaints from consumers in at least eight states who ordered devices and/or "hotspot service." In some cases, consumers said that Cleo threatened to sue them after they asked for refunds for items and service they didn't receive. Cleo's terms of service stated that it never issues refunds and that attempting to get refunds via bank chargebacks is a "breach of contract," according to the FCC. The FCC said it got no response to a subpoena it issued to Traxler and Cleo in December 2021. The now-discontinued EBB program and its replacement, the $30-per-month Affordable Connectivity Program, have provided money directly to participating broadband providers that offer monthly discounts. Some forms of telecom fraud involve the use of fictitious, ineligible, or duplicate customers to obtain payments from FCC programs, but the FCC said Traxler instead scammed consumers directly...
The FCC began investigating after receiving complaints from consumers in at least eight states who ordered devices and/or "hotspot service." In some cases, consumers said that Cleo threatened to sue them after they asked for refunds for items and service they didn't receive. Cleo's terms of service stated that it never issues refunds and that attempting to get refunds via bank chargebacks is a "breach of contract," according to the FCC. The FCC said it got no response to a subpoena it issued to Traxler and Cleo in December 2021. The now-discontinued EBB program and its replacement, the $30-per-month Affordable Connectivity Program, have provided money directly to participating broadband providers that offer monthly discounts. Some forms of telecom fraud involve the use of fictitious, ineligible, or duplicate customers to obtain payments from FCC programs, but the FCC said Traxler instead scammed consumers directly...
No surprises (Score:2, Insightful)
Any time there is strife, you can count on somebody to step up to fuck over the desperate or simply less sophisticated. Capitalism at its finest. I hope they bring back the firing squad.
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And waste precious bullets where a bunch of stones in the hands of the people he pissed off would be enough?
C'mon, a little capitalist thinking can be ok.
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But it's not capitalism if it's government funded. That's socialism. These people thought that they were signing up for a socialist program that's subsidized by the government.
And I agree, tons of abuse, fraud, and waste around government funded free-bee programs. It's usually the applicant who is defrauding the government. In this case, it's a scammer defrauding the consumer into thinking that the government was helping them out.
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You think so? And how is the scammer saving us from idiotic socialist programs? Those aren't my words and I don't see anyone saying that, so are you sarcastically projecting your own sentiments? This event had no affect on government spending, so your sarcastic straw-man joke doesn't even make any sense. They're still collecting the same taxes and throwing 100+ billion away each year on fraud and abuse.
My point was that this has nothing to do with capitalism, which is what the OP angrily claimed. So he shou
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Any time there is strife, you can count on somebody to step up to fuck over the desperate or simply less sophisticated. Capitalism at its finest. I hope they bring back the firing squad.
I agree with everything you said except for the pointless and weird claim that this scam is the result of capitalism. Have you ever been to a country that isn't "capitalist"? I have. There are no shortage of scammers and liars waiting to take anything they can from you. Scum lives in every corner of the planet and works under every economic philosophy.
more needed (Score:4, Insightful)
To hell with a stupid fine, why is this guy not being criminally prosecuted for fraud?
We need something that doesn't incentivize corruption or profiting off of crime.
All fines are going to do is reward the rich who can afford to pay them.
For profit prisons are a completely different can of worms but at least they make sure the offender doesn't get to weasel out of being punished just because he can cough up a fine that may still leave him laughing all the way to the bank if he was a good enough scammer.
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Top priority is full restitution, then fines, then prison. They always forget the restitution and jump directly to fines.
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It depends if full restitution is reasonable or not really. If the amount is large enough, that person could have a really hard time restituting the full amount, especially after having a criminal record making employment that much more difficult. So he might be tempted to do more crime to pay for it, which would create a downward spiral that he'll probably never get out of, even if he is truly trying to turn a new leaf. An "eye for an eye" is not always the best solution to a problem.
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Mostly I'm addressing the MANY cases where authorities don't even call for restitution, instead making each individual take it to civil court (if they can afford to) which leaves situations where the crime is profitable in spite of the fine, or where they first take out a fine then if anything is left it goes to restitution.
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It should be restitution, with prison as a meritoriously coercive alternative.
The whole point of consequences is to punish criminal behavior, which is criminal because it's self interested at society's expense.
FCC (Score:3)
There are a lot of gov depts that you could could try to scam, the FCC is not one of them. They have always had big teeth and not afraid to use them.
Fines? (Score:2)
I've got a better idea, throw his ass in prison for a couple of years
Comcast (Score:3)
The FCC said it reviewed 41 complaints about Cleo
41 complaints, good he was brought down, but all it took was 41 ?. So FCC, when will you do the same for COMCAST ? I am sure their complaints dwarf what Cleo did. Or due to their size are they allowed to scam people ?
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Consider the guy was given a fine and not jail time, I'm sure Comcast has been fined for misbehavior. Cost of doing business.
Pigs to the troth... (Score:2)
As with any government program, more of it goes to the scammers than the people who actually need it.
Better to earn more (Score:1)