AT&T Charged US Taxpayers $16 Million For Nigerian Fraud Calls 155
McGruber writes "Bloomberg News is reporting that AT&T got more than $16 million from the U.S. government to run Telecommunications Relay Services, intended to help the hearing- and speech-impaired. However, as many as '95 percent of the calls in AT&T's hearing- impaired program were made by people outside the U.S. attempting to defraud merchants through the use of stolen credit cards, counterfeit checks and money orders.' According to the DoJ, 'AT&T in 2004, after getting complaints from merchants, determined the Internet Protocol addresses of 10 of the top 12 users of the service were abroad, primarily in Lagos, Nigeria.' The DOJ intervened in the whistle-blower lawsuit Lyttle v. AT&T Communications of Pennsylvania, 10-01376, U.S. District Court, Western District of Pennsylvania (Pittsburgh). The DOJ is seeking triple damages from AT&T."
I was getting these calls in 2002 (Score:5, Interesting)
Back then, it was the Sprint relay service. Callers would want to buy a dozen flat panel monitors, and offer a credit card and U.S. shipping address. Card was usually bogus, but sometimes not. We accepted a few orders but when the card would not approve we just dumped them - and callers would call back to order huge quantities of more expensive gear. We actually started refusing these calls from Sprint outright, got threatened with an ADA suit, and then magically they all stopped. I wonder if Sprint figured it out, or if the clan just moved on. Our defense against the ADA complaint was that we did not do business with foreign customers, no matter the shipping address. Part of this scam was to delay the shipments, dispute the charges, get refunded, and the merchandise is gone. Card goes bad, no one to complain to, and merchants usually have no recourse with the issuer or banks. You're just out the money AND the merchandise. We didn't happen to lose a dollar, but they probably managed to nick someone.
Nice work though, AT&T being the disinterested third party for profit.
Now can we start looking into how the Universal Service Find is being hijacked to try and build the rural Internet where no provider seems willing to do so as in some cases legally required? Noooo... but crony capitalism is flourishing, thanks to the few remaining taxpayers.
Feh.
Re:Consumers will foot the bil for AT&T (Score:5, Interesting)
Punish them by forcing discounts on customers. Instead of paying the money directly, they pay it in reduced revenues.
Of course then there's no fees for the lawyers or fines for the government, so that'll never fly.
Put CEOs in JAIL (Score:5, Interesting)
Make CEOs responsible for the actions of their companies. After all, if I defauded the government of 16million dollars you bet your ass I'd be in prison, but somehow AT&T gets only a fine?
A fine that they will not even pay, since the money will actually come from their customers?
The solution is to Jail the CEO.Just ask Mitt Romney, after all, he claims the corporations are people too.
The CEOs should take responsibility, since it's the only way they can justify their outrageous salaries. It sure isn't because they've added value to the company. The S&P500 has been flat for a decade, but CEO compensation has gone up 400%.
Disclaimer: I am the 99%
Re:Let me guess.... (Score:5, Interesting)
So what do you suggest? Make corporations immune to fines and damages? Yes, their customers will have to pay off the judgement. IF they stay their customers. There is nothing stopping them from going to the competition (which will of course raise their prices, due to the sudden high demand).
According to this article [intomobile.com], in early 2011 AT&T had roughly 96 million customers. They can pay back a paltry $50 million dollar fine by increasing their customers monthly fee by 50 cents for one month.
I suggest making the management responsible. Depending on the level of collusion (an investigation will need to take place) certain managers should be fined or even jailed. This would certainly discourage others from hiding behind the 'corporations are people' bullshit while committing crimes that citizens would be locked away for. Another alternative is making the fine so large that they could not afford to pass it on to their customers - of course this will likely take the company down anyway, but who cares? You do the crime, you do the time.
Re:Consumers will foot the bil for AT&T (Score:2, Interesting)
Force them to pay the damages in shares of stock. Then, as the government slowly sells them on the open market, it will reduce the stock price, the investors will notice, and get pissed off at the management. Then they may take action.
This may not work, and there may be problems, but you want to get AT&T management to behave, getting the stockholders to notice is the only way I see to get the management to notice.