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FCC seeks $62 million from wireless provider Q Link over allegations of excessive reimbursements

The Federal Communications Commission proposed a $62 million penalty for Florida-based wireless provider Q Link Wireless for what it says are violations of the terms of a federal program meant to make the Internet more accessible for consumers. File Photo by niekverlaan/Pixabay
The Federal Communications Commission proposed a $62 million penalty for Florida-based wireless provider Q Link Wireless for what it says are violations of the terms of a federal program meant to make the Internet more accessible for consumers. File Photo by niekverlaan/Pixabay

Jan. 17 (UPI) -- The Federal Communications Commission proposed a $62 million penalty for Florida-based wireless provider Q Link Wireless for violating the terms of a federal program meant to make internet access more accessible for consumers.

The FCC said Q Link exploited the Emergency Broadband Benefit Program by seeking excessive reimbursements on claims it submitted. An order published by the FCC on Tuesday claims Q Link received more than $20 million from the program which it should not have received.

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The reimbursements were associated with Q Link's claims between 2021 and 2022.

"For these reasons, and in light of the scope, duration, and seriousness of Q Link's apparent violations and the need to promote compliance with the rules, we propose the penalty detailed in this Notice of Apparent Liability for Forfeiture and Order," the order said.

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Congress established the broadband program in December 2020, providing $3.2 billion in funding that would be used to support discounts on internet-connected devices for low-income households. This included households experiencing hardships related to the COVID-19 pandemic.

Q Link Wireless, based in Florida, was allegedly reimbursed an amount that exceeded the market value of the devices it was providing to customers under the EBB program.

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One device in particular, the Scepter 8 manufactured by Hot Pepper Inc., is an 8-inch tablet that uses the Android 11 operating system. Investigators could not find a device similar enough to the Scepter 8 for a comparable market analysis to determine if Q Link was being honest and accurate about the device's market value.

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When the FCC's Enforcement Bureau proceeded with an investigation into Q Link the company failed to cooperate.

The bureau then looked for devices that had similar RAM and ROM specifications, and devices with similar screens and processors as those are major factors that drive the prices of computer devices. The devices found to be most similar were the Hyundai HyTab 7WCI and Amazon Fire 7.

Both of those devices had a market value of about $50 to $65 a month, which the bureau used to determine that the Scepter 8's value is about $50 because it is not a brand name device.

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Based on the analysis and a review of claims from Q Link, the FCC found that the company sought funding that exceeded the value of the products it was providing.

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