**AT&T Hit with $2.3 Million Fine for Misappropriating Federal Broadband Funds**
AT&T has consented to a $2.3 million penalty following a Federal Communications Commission (FCC) investigation that uncovered the telecom company improperly acquired funds from government-sponsored broadband discount initiatives. The findings indicated that the company had submitted duplicate reimbursement applications and requested subsidies for numerous customers who were not actively utilizing AT&T’s services. Such conduct breached the regulations of the Emergency Broadband Benefit (EBB) and Affordable Connectivity Program (ACP), which were instituted to ensure internet accessibility for low-income families during and after the COVID-19 crisis.
### The FCC Inquiry and Resolution
The FCC’s Enforcement Bureau initiated an inquiry into AT&T’s involvement with the EBB and ACP programs, revealing that the company made false statements under oath. These misleading assertions enabled AT&T to secure federal funds for subscribers who were either incorrectly enrolled or not using the service whatsoever.
On Friday, AT&T finalized a settlement with the FCC, agreeing to pay a civil fine of $1.92 million and return $378,922 to the U.S. Treasury. The overall settlement amount of $2.3 million concludes the FCC’s investigation concerning AT&T’s infractions. As part of the agreement, AT&T also committed to instituting a compliance strategy to avert future violations of federal subsidy programs.
### How AT&T Breached Federal Regulations
AT&T’s infractions transpired in various forms:
1. **Duplicate Reimbursement Requests**: Between May 2021 and December 2023, AT&T registered 3,912 subscribers using inaccurate or invalid identifying details. Frequently, the same individuals qualifying for benefits (BQP)—usually a dependent child or another household member—were utilized to enroll numerous subscribers. Despite these inconsistencies, AT&T claimed adherence to FCC regulations, receiving federal funding based on these untrue assertions.
2. **Claims for Inactive Customers**: In late 2023, AT&T contravened ACP guidelines by requesting reimbursement for nearly 3,300 customers who had not utilized their broadband services for over 45 consecutive days. According to ACP rules, service providers may receive reimbursement only if a subscriber uses the service at least once every 30 days or resolves their non-usage in a following 15-day timeframe. Nonetheless, AT&T persisted in claiming funds for inactive users, falsely certifying compliance with the program’s standards.
3. **Erroneous Enrollment by Sales Representatives**: AT&T’s in-store sales associates were also involved in the violations. From May 2021 to November 2023, no fewer than 220 subscribers were registered with incorrect or invalid BQP and email address data by 21 sales representatives. These representatives neglected to obtain the necessary Representative Accountability Database (RAD ID) numbers prior to submitting enrollment information, further violating federal mandates.
### AT&T’s Reaction
When inquired about the violations, AT&T did not specifically address the underlying issues. Instead, the company lauded its involvement in the federal discount programs, asserting, “When the federal government acted during the COVID-19 pandemic to establish the Emergency Broadband Benefit program, and subsequently the Affordable Connectivity Program, we swiftly executed both initiatives to offer more affordable Internet choices for our customers. We regard compliance with federal programs like these with utmost seriousness and value our collaboration with the FCC in reaching a resolution on this matter.”
### The Emergency Broadband Benefit and Affordable Connectivity Program
The EBB was introduced in response to the COVID-19 pandemic, providing qualified households with monthly subsidies of $50 to assist with broadband service costs. Following the EBB, the ACP provided a lower subsidy of $30 per month. Telecom firms such as AT&T offered these discounts directly to customers and subsequently sought reimbursement from the federal government.
Nevertheless, the ACP concluded earlier this year after Congress failed to allocate additional funds to sustain the program. The FCC has since cautioned that the absence of funding could leave millions of low-income families without affordable internet access.
### Conclusion
AT&T’s settlement with the FCC underscores the critical nature of adhering to federal programs aimed at aiding low-income families in accessing vital services such as broadband. While the company has consented to a substantial penalty and is implementing measures to prevent future infractions, the case highlights the necessity for enhanced oversight to prevent waste, fraud, and abuse within government subsidy initiatives.
As the digital divide remains a crucial concern, especially in underserved areas, safeguarding the integrity of programs such as the EBB and ACP is essential for ensuring equitable internet access.
