Unnamed internet provider repays FCC $49M for improper subsidy claims

Internet provider repays FCC overview: 

• Who: The Federal Communications Commission said a major internet provider has voluntarily repaid the agency approximately $50 million. 
• Why: The funds were from the Affordable Connectivity Program and received for service claims made between June 2021 and July 2022. The unnamed internet provider chose to voluntarily repay the funds after it was questioned about them by the FCC’s Office of Inspector General. 
• Where: The FCC oversees connectivity within the U.S. 

A major internet provider has voluntarily repaid the Federal Communications Commission (FCC) approximately $50 million of the total Affordable Connectivity Program (ACP) funds it received for service claims between June 2021 and July 2022. 

The FCC, which referred to the provider as “Provider X,” said the company had been improperly claiming that low-income households were using its service through the ACP, a program set up by the agency in 2021 to help provide wireless internet for such households. 

“Provider X’s monthly claims rates were conspicuous as it repeatedly claimed reimbursement for all or nearly all its enrolled subscribers for many months,” the FCC said, in a news release dated Sept. 28.

The FCC said the size of the internet provider’s initial improper claims and eventual repayment showed the “potential magnitude of program waste prevented by requiring providers to ascertain that subscribers are actually using ACP service before they may seek reimbursement.”

“In short, the usage requirement plays an essential role in preventing significant program waste,” the agency said. 

Internet provider voluntarily chose to repay FCC after receiving warning,  agency says

The FCC said the internet provider chose to voluntarily repay the agency after it was contacted by the FCC’s Office of Inspector General (OIG) with a warning and request to explain its claim data. 

“OIG’s concern originated from a recent OIG investigation of an ACP provider that improperly claimed $44.5 million in program funds on behalf of subscribers who were not using their ACP service,” the FCC said. 

In addition to disclosing the $44.5 million in program funds, the internet provider also disclosed that it received $2.6 million for improper enrollments associated with the National School Lunch Program’s Community Eligibility Provision, according to the FCC. 

Further, the unnamed internet provider also disclosed that it had received $2.3 million for claims that were associated with “other compliance issues.” 

The FCC launched the ACP near the end of 2021 as a replacement for its Emergency Broadband Benefit program, according to Law360. 

The FCC announced in July that it will require internet-based providers to use call authentication as a way to prevent robocall scams. 

What are your thoughts on the FCC’s Affordable Connectivity Program? Let us know in the comments!

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