In Toledo, Firm Created Fake Low-Income Accounts to Win Federal Money for CEO's Lavish Lifestyle

click to enlarge Protesters taped fake money to their clothes; Frank's Fat Cat Festival Protest (6/28/17) - Sam Allard / Scene
Sam Allard / Scene
Protesters taped fake money to their clothes; Frank's Fat Cat Festival Protest (6/28/17)

The Federal Communications Commission, in a ruling this week, announced that a Toledo telecommunications firm would be fined more than $63 million for “apparent repeated, systematic, and large-scale violations” of a federal program designed to give poor people discounts on phone and internet service.

American Broadband, based in downtown Toledo, allegedly created thousands of fake accounts, including for dead people, to win reimbursement dollars that funded the CEO's lavish lifestyle. The fine, per the FCC, would be the largest ever for violations of this kind. (The Washington Post's story on the fine appeared on the PD's front page Wednesday morning.)

CEO Jeff Ansted is accused of using the Federal reimbursements to purchase an $8 million private jet, a $1.3 million Florida condo, a $250,000 Ferrari and memberships to multiple yacht and country clubs. Real gem of a dude, clearly. 
The Toledo Blade reported that Ansted considered the fine a surprise. He said that over the past 27 months, American Broadband has cooperated with FCC personnel, and "have nearly completed repayment of every penny due plus interest."

In other words, he knew full well that his company had been caught and assumed that instead of punishment of any kind, they'd just get to pay back all the money they stole? Plus interest?

The situation is especially yucky, though not at all atypical, because the Federal Lifeline program is designed to subsidize monthly communications bills for low-income folks. Lifeline subscribers are eligible for a $9.25 discount on their monthly phone and internet bills, which everyone knows are unconscionably expensive, and service providers like American Broadband receive funds for each subscriber, theoretically passing the savings on to the people who need it.

It's kind of like how ECOT, the infamous online charter school, received taxpayer money based on a certain number of students. ECOT wasn't creating fake accounts; it was just taking millions of dollars for students who barely logged on. It is now regarded, across party lines, as an epic failure and scandal.

Like American Broadband's Jeff Ansted, ECOT's founder Bill Lager became even stupidly richer than he already was, thanks to the public funds. And despite the demands for repayment and the broad public disapprobation, as PD sage Brent Larkin has noted, no one is going to prison for the ECOT scandal. No one is evidently guilty of any crime. 

If you're ever tempted to regard poor people on Federal assistance programs with disdain just for being on Federal assistance, maybe because of a perception that they're draining public resources or something, try to remember who the real villains, the real thiefs, are.

About The Author

Sam Allard

Sam Allard is the Senior Writer at Scene, in which capacity he covers politics and power and writes about movies when time permits. He's a graduate of the Medill School of Journalism at Northwestern University and the NEOMFA at Cleveland State. Prior to joining Scene, he was encamped in Sarajevo, Bosnia, on an...
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