Wireline Group, Wireless ETCs, Disagree on Coalition’s Lifeline Reform Proposals

"The Petition proposes real and burdensome processes and requirements to address what it acknowledges several times are ‘perceived’ abuses based on media accounts of the program,” USTelecom said (http://bit.ly/14h4LVw). “Legitimate Lifeline providers should not be penalized because of the actions of bad actors that violate Commission rules. The Commission should address negative perceptions of the Lifeline program by ensuring that the program is run with processes that ensure the highest degree of integrity, including vigorous enforcement of its rules and prompt implementation of the National Lifeline Accountability Database (NLAD)."

The Independent Telephone & Telecommunications Alliance said no changes are needed, at least for wireline companies offering Lifeline service. “Several of the Coalition’s proposed modifications appear to create burdens for Lifeline ETCs and potential Lifeline subscribers without having any corresponding benefit that would actually deter waste, fraud, or abuse in the Lifeline program,” ITTA said (http://bit.ly/13DeFkr).

But a number of eligible telecom carriers, many offering wireless service, were more supportive of the coalition’s proposals. The Lifeline 2.0 coalition -- Blue Jay Wireless, Boomerang Wireless, Global Connection of America, i-wireless and Telrite -- was largely made up of wireless ETCs.

"Requiring some form of information corroborating the identity of a Lifeline applicant could be helpful in reducing fraud,” Sprint said, and “a government-issued photo ID would be one type of acceptable documentation. However, any personal identification requirement should not be limited to a government-issued photo ID, and in-person presentation of such documentation should not be required.” Requiring a photo ID would make applicants meet a higher standard than is necessary to apply for food stamps, Sprint noted (http://bit.ly/15K4xpj). The FCC also should require that the identification information be presented in a face-to-face meeting, the carrier said. But it agreed with a proposal that carriers be required to retain proof of eligibility documentation.

Sprint also disputed a proposal that carrier employees should have to review all applications. “While Sprint certainly agrees that eligibility must be established prior to Lifeline service activation, there is no reason why this function should be performed only by employees of the service provider, but not by the service provider’s agent,” the company said. “Insofar as Sprint is aware, there is no record evidence that employee review and approval is more effective than review and approval by a qualified third party agent, and use of an agent may be a cost-efficient alternative to a service provider that does not have the administrative platform or other resources to perform eligibility determinations in-house.” Sprint supported a coalition request for a ban on the resale or transfer of handsets used for Lifeline service, but questioned how the ban would be enforced.

TracFone Wireless said it doesn’t oppose an ID requirement “but questions whether it would be an effective fraud prevention measure. However, it agrees that some further customer identification requirement would be appropriate. TracFone and others use third party sources to confirm applicant identities and that method has proven effective.” TracFone also supported a requirement that providers keep copies of applicants’ program eligibility documentation (http://bit.ly/14gX8yi). TracFone opposed a proposal that ETCs identify to Lifeline applicants the names of all other Lifeline providers. “Companies utilize multiple corporate and brand names, and availability of specific Lifeline services varies from state to state, and sometimes from study area to study area within a state,” the company said. “There is no practicable way that any ETC could be expected or required to have available current and accurate lists of other providers for each area where they seek to enroll Lifeline customers."

Prepaid wireless provider True Wireless said requiring a government-issued photo ID makes sense. “This requirement will serve a double purpose of verifying the applicant’s identification and deterring fraudulent applications,” the carrier said (http://bit.ly/16puBwi). “Adding this additional layer of verification to the Lifeline enrollment process will complement the Commission’s requirement that applicants provide documentation of eligibility and will give ETCs a more comprehensive ability to evaluate the eligibility of Lifeline applicants.” Requiring ETCs to keep ID and eligibility documents on hand also makes sense and would “allow ETCs to better track and internally verify the identity and eligibility of each Lifeline customer,” “allow ETCs and the Commission to more effectively respond to outside criticisms and claims that many Lifeline customers are ineligible” and facilitate program audits, True Wireless said.

Low-cost wireless carrier Cricket said it supports many of the proposals. “Cricket has checked applicants’ photo IDs in person since the outset of its participation in the Lifeline program and has found that practice to be an effective mechanism for ensuring program integrity,” the carrier said (http://bit.ly/16pxcq7). Cricket also supports requirements that carriers keep ID documents on hand and said ETCs should be required, as the coalition asked, to offer live support to customers. “Such support (which Cricket and most other ETCs already provide) would help ensure that low-income consumers are able to benefit from the connectivity provided by the Lifeline program,” the filing said.

Requiring photo ID or in-person review of Lifeline applicants isn’t practical, countered Cincinnati Bell. “Quite simply, many ILECs, including CBT, do not typically enroll customers (Lifeline or non-Lifeline) in-person or at retail locations,” the carrier said. “Rather, CBT requires all Lifeline applications and documentation to be mailed or faxed to the company for review and approval.” Requiring in-person review would mean “new processes with new expenses,” CBT said (http://bit.ly/14Pi4Qg). “There is little risk of identity fraud with wireline service because service is associated with both a customer and a fixed location known to the service provider.”