Bastrop, Texas (EMWNews) – January 31, 2024 The Federal Communications Commission (FCC) has imposed a $14 million fine on Tone Communications, a Texas-based internet service provider, for knowingly using false information to secure millions in funds from the Affordable Connectivity Program (ACP), a vital initiative designed to subsidize internet costs for lower-income households. This penalty comes as a result of a notice of liability and forfeiture issued by the FCC.
Tone Communications allegedly took advantage of both the COVID-19-era Emergency Broadband Benefit and its successor, the Affordable Connectivity Program, by utilizing deceptive tactics to enroll subscribers with fabricated or inaccurate identifying information. The FCC revealed that the company employed various methods, including using addresses unrelated to the purported subscribers or repeatedly using the same non-subscriber benefit qualifying person (BQP) to enroll multiple subscribers.
According to the FCC’s findings, Tone Communications engaged in unethical practices, such as enrolling hundreds of accounts using information from only a few qualified individuals. An investigation conducted by the Office of Inspector General uncovered that during the summer of 2022, Tone enrolled 154 households in Oklahoma using the information of just three people.
The FCC further detailed instances where the provided data was incorrect, with subscribers not residing at the addresses they were registered under, and some being located hundreds of miles away. The Enforcement Bureau of the FCC identified cases where subscribers could not be reached, and at least one individual claimed to have never heard of Tone and denied signing up for any services through the company.
In total, between early 2022 and late 2023, Tone received over $15.6 million from the FCC, largely based on false information, as per the agency’s statement. The proposed $14,021,293 forfeiture penalty, according to the FCC, reflects the severity and duration of Tone’s numerous apparent violations, emphasizing the harm caused to the ACP.
The Affordable Connectivity Program, initiated in response to the COVID-19 pandemic under the Biden administration, began as the Emergency Broadband Benefit, offering discounted internet services to low-income households. Originally intended as a temporary measure, the program evolved into a permanent one with a multibillion-dollar budget. However, with over 22 million households enrolled, the program is projected to exhaust its funds by April unless Congress intervenes. Consequently, the FCC has announced plans to wind down the program, with a cessation of new applications scheduled for February.
