Latest Scam Alert: Selling Those “Free Obama Phones”
Leave it to James O’Keefe to expose the latest scandal to hit this administration—or rather re-expose a topic that’s been around since the last election. O’Keefe slammed ACORN back in 2009, using hidden cameras. He and Hannah Giles posed as pimp and prostitute looking to ACORN for help planning several illegal activities. As a result Congress voted to freeze funds for the non-profit.
Well, O’Keefe is back, and this time he exposes the truth behind those “free” cell phones, handed out all across the country. Guess what some people are doing with their free phones? Selling them for drugs, shoes handbags, and cash. Not exactly what the folks who came up with the program had in mind.
The Lifeline Phone Program started in 1985 to help low income consumers with phone service, and obviously back then we were talking landlines. And while Obama didn’t start the program, cell phones were added back in 2008, and his administration has seen it growth skyrocket.
In O’Keefe’s video he found out two companies, Stand Up Wireless and TerraCom Wireless had set up tents in Philadelphia to encourage people to sign up for the free phones. These companies collect a fee for every person they enroll and supply with a basic no-frills mobile phone. (Stand Up Wireless has collected more than $38 million so far.) That’s when the funny stuff started. You see people asking if they can keep the phone…or sell it to buy things they really need.
Who pays for this? A good portion of it is paid for by you and me, in the form of a Federal Universal Service charge, collected on both land and mobile bills in all 50 states and DC. I just checked my cell phone bill. There it is – $2.80.
As if all this doesn’t make your blood boil, hang on. In California not only are they handing out free phones, they don’t have to worry about checking up on the people who are requesting them. That’s right. The California Public Utilities Commission has been exempt from the federal fraud detection program.
And fraud runs rampant in this program, the FCC found on average 9% of people receiving phones were ineligible, and in some states that rate went up to 18%. Even with those alarming numbers, the FCC believes the CPUC can police itself. Seems we’ve been hearing a lot of that lately.
Written by Debby Wolf