SEMIANNUAL REPORT

TO CONGRESS

 

OCTOBER 1, 2022 – MARCH 31, 2023

FEDERAL COMMUNICATIONS COMMISSION 

OFFICE OF INSPECTOR GENERAL 

 
FCC OIG—Semiannual Report to Congress 1 10/1/22 – 03/31/23

FROM THE ACTING INSPECTOR GENERAL

I am pleased to present the Federal Communications Commission’s Office of Inspector 

General’s (OIG) Semiannual Report to Congress for the six months ending March 31, 

2023. In accordance with Inspector General Act, as amended, 

5 U.S.C. § 405, this report summarizes the activities and accomplishments of the OIG. 

The report describes audit work and investigations we have completed during the 

preceding six months, as well as those in process. Where appropriate, reports of 

completed audits and investigations have been forwarded to the Commission's 

management for action and are posted to the OIG website. 

OIG is committed to promoting transparency and conducting aggressive oversight of the 

long-standing Universal Service Fund programs as well as the more than $10 billion in 

Federal Communications Commission pandemic response funding included in the 

American Rescue Plan Act of 2021, the Coronavirus Aid, Relief, and Economic Security 

Act, other pandemic response legislation, as well as the Infrastructure Investment and 

Jobs Act, to ensure that (1) funds for assistance are timely, effectively distributed, and 

used appropriately; (2) adequate and proper internal control procedures are in place; (3) 

program participants meet eligibility guidelines and comply with program requirements; 

and (4) offices establish effective compliance operations. 

The Investigations staff continues to address external threats to the integrity of the 

programs while also undertaking proactive work focused on agency processes, to deter 

and detect fraud, waste, and abuse. Our audits of Federal Communications 

Commission’s programs and operations continue to promote effectiveness, efficiency, 

and integrity.

We thank the Offices of Inspector General of other federal agencies, the Department of 

Justice, the Federal Bureau of Investigation, senior officials throughout the Commission, 

and members of Congress and their staffs for their support of our work and for their 

receptiveness to our recommendations to improve Federal Communications 

Commission programs and operations. OIG remains committed to maintaining the 

highest possible standards of professionalism and quality in its audits, investigations, 

inspections, and consultations. We welcome your comments, suggestions, and 

questions. 

Finally, I would like to acknowledge the great loss our office has suffered with the 

passing in January of our Inspector General, David L. Hunt. David served as Inspector 

General of the Federal Communications Commission since 2011. Prior to that, he 

served as Assistant Inspector General for Investigations, as well as Acting Inspector 

General. A dedicated public servant, David began his federal career in 1996 when he 

joined the Commission as an attorney-advisor in the Pricing Division of the former 
FCC OIG—Semiannual Report to Congress 2 10/1/22 – 03/31/23

Common Carrier Bureau where he helped implement some of the most complex 

provisions of the 1996 Telecommunications Act. David was a strong leader whose 

appointment to the position of inspector general heralded a new era for OIG that 

witnessed growth and reputational excellence. He was a valued colleague and friend, 

and his contributions to our office and devotion to the IG community will always be 

remembered. 

 Sharon R. Diskin

Acting Inspector General
FCC OIG—Semiannual Report to Congress 3 10/1/22 – 03/31/23

TABLE OF CONTENTS

FROM THE ACTING INSPECTOR GENERAL ..................................................... 1

ABBREVIATIONS & ACRONYMS ........................................................................ 4

INTRODUCTION ................................................................................................... 6

OFFICE OF MANAGEMENT ................................................................................ 9

Office Staffing........................................................................................................ 9

Legislative and Policy Matters............................................................................. 10

OFFICE OF INVESTIGATIONS .......................................................................... 11

OFFICE OF AUDIT ............................................................................................. 28

Operations, Financial, and Information Technology Division............................... 28

Completed OFID Projects ................................................................................... 29

In-Process OFID Audits and Other Projects ........................................................ 30

Universal Service Fund Division.......................................................................... 31

In-Process USFD Audits and Other Projects....................................................... 32

REPORTING REQUIREMENTS ......................................................................... 33

APPENDIX A1 ..................................................................................................... 38

APPENDIX A2 ..................................................................................................... 39

APPENDIX B ....................................................................................................... 44

APPENDIX C ...................................................................................................... 45
FCC OIG—Semiannual Report to Congress 4 10/1/22 – 03/31/23

ABBREVIATIONS & ACRONYMS

ACP Affordable Connectivity Program 

ARPA American Rescue Plan Act 

AIG Assistant Inspector General 

BQP Benefit Qualifying Person 

CAF Connect America Fund 

CAA Consolidated Appropriations Act 

CARES Coronavirus Aid, Relief, and Economic Security 

CGB Consumer & Governmental Affairs Bureau 

CIGIE Council of the Inspectors General on Integrity and Efficiency 

DOE Department of Education 

DOJ Department of Justice 

E-Rate Schools and Libraries Program 

ED OIG Department of Education Office of Inspector General 

ETC Eligible Telecommunications Carriers 

EBB Emergency Broadband Benefit 

ECF Emergency Connectivity Fund 

EXIM Export-Import Bank of the United States 

FBI Federal Bureau of Investigation 

FCA Federal False Claims Act 

FCC Federal Communications Commission 

FISMA Federal Information Security Modernization Act of 2014 

FLETC Federal Law Enforcement Training Center 

FY Fiscal Year 

GAO Government Accountability Office 

IPA Independent Public Accountant 

IG Inspector General 

IP-CTS Internet Protocol Captioned Telephone Service

IT Information Technology 

Kearney Kearney and Company, P.C. 

NARA National Archives and Records Administration 

NLAD National Lifeline Accountability Database 

NPRM Notice of Proposed Rulemaking 

OA Office of Audit 

OGC Office of General Counsel 

OIG Office of Inspector General 

OI Office of Investigation 

OMB Office of Management and Budget 

OMD Office of Managing Director 

OFID Operations, Financial, and Information Technology Division 

PBGC Pension Benefits Guaranty Corporation 

PII Personal Identifiable Information 

PIIA Payment Integrity Information Act 
FCC OIG—Semiannual Report to Congress 5 10/1/22 – 03/31/23

PN Public Notice 

PQAD Policy and Quality Assurance Division 

RHC Rural Health Care 

SAR Semiannual Report to Congress 

TRS Telecommunications Relay Services 

TPIV Third-Party Identity Verification 

USAC Universal Service Administrative Company 

USF Universal Service Fund

USFD Universal Service Fund Division 

WCB Wireline Competition Bureau 
FCC OIG—Semiannual Report to Congress 6 10/1/22 – 03/31/23

INTRODUCTION 

The Federal Communications Commission (FCC or the Commission) is an independent 

regulatory agency, established by Congress to regulate interstate and foreign 

communications by radio, television, wire, satellite and cable. The FCC’s jurisdiction 

covers the fifty states, the District of Columbia, the Commonwealth of Puerto Rico, and 

all U.S. territories.

The Commission is typically composed of five members who are appointed by the 

President and subject to confirmation by the Senate. Normally, one Commissioner is 

appointed or reappointed each year, for a term of five years. One of the members of the 

Commission is designated by the President to serve as Chair of the Commission. 

Jessica Rosenworcel currently serves as Chairwoman. Brendan Carr, Geoffrey Starks 

and Nathan Simington currently serve as Commissioners. Most of the FCC's employees 

are located at the FCC’s Headquarters at 45 L Street NE, Washington, DC. Field offices 

and resident agents are located throughout the United States.

The Office of Inspector General (OIG) is dedicated to ensuring compliance with the 

requirements of the Inspector General Act of 1978, as amended (IG Act), and assisting 

the Commission in its continuing efforts to improve operational and program 

effectiveness and efficiency. The OIG is headed by Acting Inspector General 

Sharon R. Diskin while awaiting Senate confirmation of a permanent Inspector 

General. The principal assistants to the Acting Inspector General are: 

Eric Phelps, Acting Counsel to the Acting IG 

Hillary Burchuk, Acting AIG for Investigations 

Sophila Jones, AIG for Audit 

Johnny Drake, AIG for Management 

In this Semiannual Report to Congress (SAR), we discuss accomplishments and 

activities of OIG from October 1, 2022 through March 31, 2023, as well as its goals 

and plans. 

During this period, OIG focused a significant portion of our effort overseeing and 

monitoring the Universal Service Fund (USF) programs, which are administered by the 

Universal Service Administration Company (USAC) on behalf of the FCC, and on the 

newer subsidy programs established by Congress related to COVID-19 Pandemic relief 

programs and the Infrastructure Investment and Jobs Act (Infrastructure Act). Because 

the new programs used existing USF program infrastructure, USAC also administers 

most of the FCC’s new COVID-19 Pandemic programs. The following provides an 

overview of the USF and the related pandemic and economic relief programs: 

The High-Cost Fund provides support to certain qualifying telecommunications carriers 

serving high-cost (primarily rural) areas. Telecommunications carriers receiving support 
FCC OIG—Semiannual Report to Congress 7 10/1/22 – 03/31/23

must offer services to rural area consumers at rates reasonably comparable to the rates 

for services offered in urban areas. The Connect American Fund (CAF) was designed to 

transition the program away from its predecessor the High-Cost Fund, which provided 

voice-only telephone service, to providing multi-purpose networks capable of offering 

broadband Internet access. Disbursements for the High-Cost Program, including legacy 

High-Cost Program and CAF support, totaled $4.2 billion in calendar year 2022. 

The Schools and Libraries Program, also known as “E-Rate,” provides support to 

eligible schools and libraries in every U.S. state and territory to help fund 

telecommunication services, Internet access, and internal connections. In E-Rate 

funding year 2022, USAC processed over 35,400 applications from schools and 

libraries seeking over $3.08 billion in E-Rate support to over 128,500 schools and 

libraries. In calendar year 2022, USAC authorized disbursement of over $2.083 billion in 

E-Rate support, with over 130,000 schools and libraries receiving support. 

As part of the American Rescue Plan Act of 2021, Congress authorized the Emergency 

Connectivity Fund (ECF), a $7.17 billion program to help schools and libraries provide 

the tools and services their communities needed for remote learning during the COVID19 emergency period. For eligible schools and libraries, the ECF Program covers 

reasonable costs of laptop and tablet computers, Wi-Fi hotspots, modems, routers, and 

broadband connectivity purchases for off-campus use by students, school staff, and 

library patrons. Since ECF’s June 2021 launch, the Commission has committed more 

than $6.6 billion in funding to support approximately 10,000 schools, 1,000 libraries and 

100 consortia, and provided nearly 13 million connected devices and over 8 million 

broadband connections. 

The Lifeline Program provides support to eligible telecommunications carriers that, in 

turn, offer discounts on telecommunications services to eligible consumers. In 2022, 

Lifeline support was approved for disbursement totaling more than $609 million. 

The Consolidated Appropriations Act of 2021 (CAA) established the Emergency 

Broadband Benefit (EBB) Fund, which provided $3.2 billion to the FCC to help lowincome households pay for broadband service and connected internet devices, as part 

of a response to the COVID-19 emergency. The EBB Program provided a discount of 

up to $50 per month for broadband service for eligible customers. The EBB Program 

was intended to be a temporary response to the pandemic emergency. However, in the 

Infrastructure Act, Congress appropriated money for a long-term program subsidy 

program known as the Affordable Connectivity Program (ACP). The ACP is a $14 billion 

benefit program intended to ensure households can afford the broadband they need for 

work, school, healthcare and more. This program provides a discount of up to $30 per 

month toward internet service for eligible households and up to $75 per month for 

households on qualifying Tribal lands. More than 17 million households have enrolled in 

the ACP. 
FCC OIG—Semiannual Report to Congress 8 10/1/22 – 03/31/23

The Rural Health Care (RHC) Program provides support to eligible rural health care 

providers who qualify for reduced rates for telecommunications and broadband 

services. This support subsidizes their access to these services, making telehealth 

services affordable in rural areas. Demand for RHC Program funding has continued to 

be high. The RHC Program approved disbursements totaled more than $496 million 

with over 12,238 participating health care providers receiving commitments in 2022. 

The COVID-19 Telehealth Program provided funding to eligible health care providers 

responding to the COVID-19 pandemic to support telecommunications services, 

information services, and connected devices needed to provide critical connected care. 

This program was established in the Coronavirus Aid, Relief, and Economic Security 

(CARES) Act, providing $200 million in funding. The CAA provided an additional 

$249.95 million to fund a second round of the COVID-19 Telehealth Program. Between 

August 26, 2021 and January 26, 2022, the Commission had committed $256 million in 

funding to 447 awardees. The FCC Wireline Competition Bureau (WCB) extended the 

deadline for Round 2 funding recipients to purchase eligible devices and implement 

eligible services from July 31, 2022 to October 31, 2022, and therefore also extended 

the deadline for submitting invoices for reimbursement by three months. As the 

Department of Health and Human Services expects to allow the Public Health 

Emergency to expire at the end of the day on May 11, 2023, the OIG anticipates the 

emergency period for purposes of the COVID-19 Telehealth Program would 

correspondingly end on the same day. 

OIG is also responsible for oversight of USF receipts collected from telecommunications 

providers offering international and interstate telecommunications services. Those 

telecommunications providers are collectively referred to as contributors. More than 

3,600 contributors submitted total USF contributions of approximately $7.38 billion in 

2022. 
FCC OIG—Semiannual Report to Congress 9 10/1/22 – 03/31/23

OFFICE OF MANAGEMENT 

Office Staffing 

Our office consists of 46 experienced professional and administrative staff including 

auditors, investigative attorneys, data analysts, administrative management specialists, 

program and management analysts, a paralegal, an investigative analyst, an industry 

economist, an information technology (IT) specialist, a computer forensics investigator, 

a budget officer, and a writer/editor. 

Continuous training and education increase the expertise of all staff and satisfy the 

training requirements mandated by various professional organizations. The staff 

attended and completed courses sponsored by government agencies, including the 

Government Accountability Office (GAO), Council of Inspectors General on Integrity and 

Efficiency (CIGIE), the National Defense University, and the Federal Law Enforcement 

Training Center (FLETC); and professional organizations and other training vendors, 

such as the American Institute of Certified Public Accountants, Institute of Internal 

Auditors, Association of Governmental Accountants, Association of Certified Fraud 

Examiners, Information Systems Audit and Control Association, Management Concepts, 

National Association of State Auditors, Controllers and Treasurers, and the Graduate 

School USA.

Changes and Improvements 

Remote Work Environment 

Staff have been working remotely full-time for three years. Technological solutions 

facilitated remote meetings, investigations, audits, an external peer review of another 

OIG, staff recruitment and hiring, data reporting, training, and overall office 

management. Throughout, the staff exhibited professionalism, dedication, and 

commitment to the our mission and to serving the public interest. 

Secure Office Space for OIG

As reported in the last SAR, although the COVID-19 pandemic impeded access to the 

new headquarters, once we entered the facility the lack of secure space for 

investigation staff raised concerns. OIG-assigned office space is not within a limitedaccess secured perimeter. Thus, anyone with access to the FCC headquarters may 

freely enter this space. 

Secure space is fundamental and integral to conducting OIG investigations. OIG 

investigates not only waste, fraud, and abuse but also potential violations of law. 

Appropriate targets of OIG investigations include Commission staff. OIG personnel 

need to conduct sensitive discussions and analyze evidence and data without fear or 
FCC OIG—Semiannual Report to Congress 10 10/1/22 – 03/31/23

concern that Commission staff or others unnecessarily or inappropriately enter OIG 

space. OIG’s lack of secure space in the building disrupts and compromises our mission 

as our work concerning sensitive law enforcement matters, and often material governed 

by 18 USC Sec 6(e), must be conducted in an environment that guarantees the 

confidentiality of our work. This work includes, but is not limited to, conducting 

interviews as part of covert criminal investigations or False Claims Act (FCA) suits, with 

or without the assistance of Federal Bureau of Investigation (FBI) agents and 

Department of Justice (DOJ) prosecutors; examining sensitive documents; conducting 

data analytics and forensic examinations; and participating in confidential intra-office 

meetings. Our concerns are shared by CIGIE and broader groups of inspectors general. 

Significantly, within the perimeter of OIG space are several common meeting spaces 

that anyone in the agency may reserve, thus inviting FCC personnel as well as outside 

visitors directly into our space. In one example, a conference room is directly adjacent 

to two cubicles occupied by OIG data analysts working on some of the most critical and 

sensitive work of the office. 

 

Our office is well within its authority to ask the FCC to provide secure space, i.e., to 

erect walls and other barriers necessary to restrict access to our space. However, at 

this time, we have asked only that the FCC adopt a pragmatic approach; we proposed a 

few low-cost, practical solutions to our space concerns. Yet, because the FCC has 

continually identified problems with our suggested remedies, rather than provide 

workable solutions, we are led to question the FCC’s commitment to resolving our 

space concerns. 

Legislative and Policy Matters 

Pursuant to 5 U.S.C. § 404(a)(2) OIG monitors and reviews existing and proposed 

legislation and regulatory proposals for their potential impact on OIG and the FCC’s 

programs and operations. We perform this activity to evaluate legislative potential for 

encouraging economy and efficiency, while helping to reduce fraud, waste, abuse, and 

mismanagement. 

Tasked with supporting efforts to prevent and detect fraud, waste, abuse, and 

mismanagement and to mitigate major risks that cut across program and agency 

boundaries, OIG is committed to promoting transparency and conducting aggressive 

oversight of the Universal Service programs and other subsidy programs. During the 

reporting period, we continued to share updated recommendations to prevent and 

detect fraud, waste, and abuse with Commission and USAC staff. 
FCC OIG—Semiannual Report to Congress 11 10/1/22 – 03/31/23

OFFICE OF INVESTIGATIONS 

OIG Office of Investigations (OI) covers a wide range of topics touching on myriad 

aspects of the FCC’s mission and programs. Most significantly, our investigations often 

address allegations of criminal misconduct or civil fraud in the Commission’s 

telecommunications subsidy programs. We deal with complex investigations, large 

criminal conspiracies, and matters involving complex financial transactions throughout 

the United States and its territories. These difficult and wide-ranging cases often require 

substantial investigative expertise and resources, including personnel on the ground 

across several states, or high-grade forensic tools and the expertise to use them. In 

these cases, we have always received, and are grateful for, the assistance of other 

agencies, especially the Offices of Inspector General of other federal agencies, the 

DOJ, and the FBI. 

OI receives and investigates complaints regarding the manner in which the FCC 

executes its programs, how it handles its operations administratively, and how the FCC 

conducts its oversight responsibilities. Allegations come from a variety of sources 

including FCC managers and employees, contractors, program stakeholders, Congress, 

and the public at large. Whistleblower requests for anonymity are honored, except when 

identification is needed for law enforcement purposes. Allegations may also be referred 

by OIG auditors. 

In addition to investigations regarding Commission programs, OI investigates 

allegations of improper employee and contractor activity implicating federal statutes or 

regulations establishing standards of conduct and procedure. 

While we have made recent additions to our staff, OI, like most government offices, has 

an ever-increasing volume of work and limited resources. Thus, matters having the 

potential to significantly impact federal funds, important FCC missions or programs, or 

the basic integrity and workings of the agency receive the highest priority for 

investigation and assignment of resources. 

Statutory Law Enforcement Authority 

OIG has sought to hire federal criminal investigators (1811s) for a decade. OI is staffed 

primarily by investigative attorneys. OI’s investigative attorneys assess complaints, 

collect and analyze evidence, direct data analyses, interview witnesses, and make 

criminal and civil referrals to the U.S. DOJ. OI’s lack of on-staff 1811s significantly 

encumbers our ability to fulfill the mission of the office. 

As noted, OI’s investigative attorneys routinely conduct in-person interviews of 

witnesses, potential targets, and targets (collectively, interview subjects). These 

interviews are frequently unscheduled and often occur at unsecure locations including 

office buildings, coffee shops, and personal residences. To mitigate safety risks, OI
FCC OIG—Semiannual Report to Congress 12 10/1/22 – 03/31/23

investigative attorneys conduct higher risk interviews only when an armed agent is 

available to assist. Many interview subjects, including some who have criminal records, 

present a safety risk to untrained, unarmed OIG staff. In addition, 1811s also receive 

specialized investigative training that would significantly enhance OIG’s ability to 

accomplish its mission, including covert and surveillance operations, and evidence and 

intelligence gathering. 

Accordingly, OIG must rely upon the trained special agents and law enforcement 

authority of other agencies, including the FBI, the Department of Education Office of 

Inspector General (ED OIG), and the U.S. Postal Inspection Service (USPIS) to conduct 

many interviews. While these law enforcement agencies have generously supported 

many OIG investigations, each has their own distinct mission to fulfill and resource 

constraints, and such partners are not always available to assist our office. 

We have repeatedly, over many years, attempted to persuade the FCC to allow our 

office to post vacancy announcements and hire 1811s, most recently in 2022. While the 

FCC states that “it is willing to do what it can to facilitate OIG hiring,” it has requested 

that OIG first enter into a memorandum of understanding (MOU) regarding various 

hiring issues including position classification, qualification determination, and pay 

setting. The FCC also stated that its HR staff lacks the expertise required to hire 1811s. 

The FCC’s HR has well-handled OIG hiring and has worked with our office on position 

classifications, qualification determinations and other hiring questions for decades. 

Thus, if there are gaps in FCC’s HR expertise concerning 1811 hiring, we stand ready 

to procure the missing expertise. Moreover, OIG recently provided specific answers and 

took measures to address perceived administrative hurdles identified by the agency. 

Notably, many designated federal entities (DFE) and establishment OIGs throughout 

the government have on-staff 1811s to support their missions—those federal agencies 

routinely hire and manage 1811s in the normal course of operations. 

At this juncture, the FCC has proposed to work with us “to develop a written outline for 

such an MOU,” not an actual MOU. By the FCC’s timeline, we are still years away from 

hiring 1811s. In the meantime, criminals remain unprosecuted and threats to FCC 

programs, which disburse billions of dollars annually, go undeterred. 

Following is a small sample of FCC investigations that were negatively impacted by a 

lack of 1811s: 

➢ In January 2023, OIG received credible information from a law enforcement 

partner that a sales agent who works for an ACP provider is stealing personal 

identifiable information (PII) to enroll unsuspecting Medicaid recipients into the 

ACP. Moreover, the law enforcement partner shared compelling evidence that 

the sales agent, who may be involved in gang-related activity, was selling tablets 

provisioned with ACP-subsidized service on the street for several hundred dollars 

each. We have received several similar tips regarding other sales agents around 
FCC OIG—Semiannual Report to Congress 13 10/1/22 – 03/31/23

the country suspected of stealing low-income consumer PII and selling ACPsubsidized devices on the street from whistleblowers and other law enforcement 

agencies over the past year. 

➢ OIG recently concluded a near decade-long investigation into E-Rate fraud 

involving tens of millions of dollars committed by schools and vendors in New 

York. The investigation resulted in guilty pleas by seven individuals who must 

now pay millions in restitution and fines. The challenges faced by OIG during this 

investigation demonstrate our need for trained 1811s. During the investigation, 

the FBI reported multiple incidents of physical harassment by individuals at some 

of the schools under investigation. It was unsafe for OIG investigators to attempt 

to conduct interviews or site visits at the schools without armed agents. FBI 

agents ensured the safety of OIG’s investigative attorneys. Second, OIG 

depended on the FBI and other special agents to execute multiple search 

warrants to gather evidence that the schools had not received the millions of 

dollars of equipment funded by the E-Rate program. Absent FBI and other 1811 

assistance, these search warrants would not have been possible and valuable 

evidence used in the subsequent criminal prosecutions would have remained 

uncollected. Simply put, OIG’s investigation was not possible without 1811 

support. 

➢ During an ongoing investigation targeting an ACP provider, the government team 

determined that conducting a covert intelligence-gathering operation is necessary 

to collect essential evidence. All OIG’s investigative attorneys are prevented by 

ethics rules from using a false identity to obtain evidence of potential criminal 

conduct. As a result, OIG must rely on the USPIS to conduct the covert 

operation. It has taken months to get approval for the operation while 

government losses multiply. 

Upon request, we will provide additional examples of cases adversely impacted by our 

lack of on-staff 1811s. 

Due to the unforeseen and untimely passing of FCC’s Inspector General, the Acting 

Inspector General has taken up the task of eliminating Commission roadblocks to hiring 

qualified criminal investigators. CIGIE has provided guidance to the Acting Inspector 

General to develop a path forward if Commission roadblocks cannot be eliminated. 
FCC OIG—Semiannual Report to Congress 14 10/1/22 – 03/31/23

Activity During This Period 

Cases pending as of September 30, 2022...................... 48 

New Cases.............................................................. 10 

Cases Closed..............................................................3 

Cases pending as of March 31, 2023..................................55 

These numbers do not include preliminary reviews of allegations, from the Hotline or 

other sources, or matters involving minimal analysis of the allegations or evidence. 

Significant Activities 

Several of the Office’s significant activities are described below. However, we discuss 

investigations only when and if information may be made public without negative impact 

on law enforcement activities, including criminal prosecutions, and without divulging 

investigative techniques. Thus, many matters could not be considered for inclusion in 

this summary. During this reporting period, we have been working on numerous 

investigations upon which we cannot report, including matters before a Grand Jury and 

qui tam lawsuits under seal. 

 

Investigations into Fraud in FCC Subsidy Programs 

The bulk of OI’s work involves investigating and supporting civil and criminal 

investigations and prosecutions of fraud in the FCC subsidy programs. The Assistant 

Inspector General for Investigation and investigations staff routinely work with other 

state, local and federal agencies on these matters. These coordinated investigatory and 

prosecutorial efforts, especially those involving DOJ, ED OIG, and various U.S. 

Attorneys, have resulted in many successes, including civil settlements and criminal 

convictions. 

Most of our ongoing investigations are not known to the public and even some closed 

investigations cannot be disclosed because of sensitivities that could impact related 

ongoing matters. Specifically, the OI is engaged in multiple, ongoing, large-scale 

investigations, as well as qui tam lawsuits under seal, seeking damages pursuant to the 

FCA. We hope to share details about these matters in the near future. We have, 

however, begun to disseminate information that can be made publicly available more 

widely, with the expectation that details of our work will serve as a deterrence against 

future fraud. In addition to OIG posting news releases on the FCC OIG’s webpage and 

on our social media sites, in response to OI’s request, USAC has also been posting OI 

headlines, such as press releases and other significant items, to USAC’s website. 
FCC OIG—Semiannual Report to Congress 15 10/1/22 – 03/31/23

Highlighted below are a few matters that have had public developments during the 

reporting period: 

Lifeline, Emergency Broadband Benefit Program and Affordable 

Connectivity Program 

Proactive work

OIG’s Recommendations Regarding the Commission’s ACP Data Collection Order 

On November 15, 2021, the President signed the Infrastructure Act. This statute, inter 

alia, modified and extended the EBB Program into a longer-term broadband subsidy 

program, the ACP. The Infrastructure Act also requires the Commission to issue 

“broadband transparency rules” regarding the annual collection of information about the 

price and subscription rates of internet service offerings received by households 

enrolled in the ACP within one year of its enactment. 

On June 7, 2022, the Commission issued a Public Notice (PN) to seek comment on the 

data to be collected, the mechanism for collecting the data, and the format for the data’s 

publication. In response, on October 6, 2022, OIG shared its recommendations with the 

Commission. OIG’s recommendations focused on fraud prevention, highlighting waste, 

and collecting data useful to OIG investigations. The Commission did not adopt any of 

OIG’s recommendations. Below, we summarize 1) OIG’s most noteworthy 

recommendations; and 2) the Commission’s explanation for declining to adopt the 

recommendations. 

 

➢ Incentives and Discounts: OIG recommended the Commission require providers 

to report any incentives, including promotional discounts, offered to customers 

who enroll in service eligible for ACP support. As OIG shared with the 

Commission, our office learned through complaints and investigations that at 

least several providers have offered gift cards and other incentives to customers 

for enrolling in ACP-supported service. OIG is concerned that incentives and 

promotional offers may lure subscribers who might not otherwise desire ACP 

service to enroll, particularly if prospective subscribers are not required to 

contribute financially to the cost of their ACP service. The Commission declined 

to adopt this recommendation. The Commission explained that 1) the value of 

such incentives would not inform the Commission of the price of the ACP 

discount service absent the discount; and 2) the information is outside the scope 

of the Commission’s authority for the data collection. Providers may provide 

information related to discounts for auto payment or paperless billing or other 

discounts voluntarily. 
FCC OIG—Semiannual Report to Congress 16 10/1/22 – 03/31/23

➢ Subscriber Usage: OIG recommended the Commission require providers to 

report the amount of data used by each subscriber each month. The collection of 

subscriber-level, monthly usage data is the clearest, most straight-forward way 

for the Commission to measure the performance of the ACP and to assess and 

prevent wasteful payments for service that was never requested by the 

consumer, abandoned, or barely used. Under the current usage standard, the 

Commission cannot assess whether subscribers are actually using broadband 

service. For example, qualifying “usage” may be satisfied by a subscriber 

responding to direct contact from the provider on a third-party device to confirm 

that he or she wants to continue receiving ACP service. Finally, the collection of 

monthly subscriber data usage would have significant enforcement benefits. As 

OIG reminded the Commission, a number of Lifeline Eligible 

Telecommunications Carriers (ETCs), including Sprint and TracFone, discovered 

extensive problems with their own usage monitoring and compliance in recent 

years only after they were pushed to investigate or report data usage to 

regulators, investigators, or auditors. Those providers collected hundreds of 

millions of dollars in improper subsidies. 

 

Although the Commission declined to adopt this recommendation after it 

determined the collection of subscriber-level data may require consumer 

consent, it is requiring ACP providers to submit aggregated information related to 

service usage. 

➢ Aggregate versus Subscriber-Level Data: OIG also expressly warned the 

Commission that the collection of aggregated program data is not a substitute for 

collecting subscriber-level data. The collection of aggregate data depends on 1) 

the trustworthiness of providers; 2) the competence of provider personnel to 

aggregate data; and 3) the consistent use of the same method of aggregation by 

all providers. Aggregate-level data may hide or disguise a multitude of problems 

and is generally unhelpful for policing program integrity. Moreover, Congress 

intended and anticipated the collection of subscriber-level data when it instructed 

the Commission to protect PII in the publicly available annual data collection. 

While the Commission declined to collect subscriber-level information, due to 

“statutory challenges” and consumer consent requirements, the Commission 

sought further comment on subscriber-level data collection. 

In response to the Commission’s explanations, OIG emphasized that these 

recommendations are important for the long-term integrity of the ACP and noted that we 

consider these standing recommendations for the Commission to reconsider. The 

FCC’s March 27, 2023, request for comment on the data fields to be collected under the 

ACP Transparency Data Collection—which failed to include any of OIG’s 
FCC OIG—Semiannual Report to Congress 17 10/1/22 – 03/31/23

recommendations—is further, public evidence that the FCC disregarded our prior 

recommendations. 

OIG Recommendation Concerning Verifier Data to be Shared with Lifeline and ACP 

Providers 

Lifeline and ACP providers have complained to OIG that the Commission and USAC do 

not share important Lifeline and ACP consumer information that would assist providers 

in ensuring compliance with program rules. During the reporting period, OIG 

recommended that the Commission and USAC share the following consumer 

information with providers in the National Lifeline Accountability Database (NLAD): 

1. Benefit Qualifying Person’s (BQP) PII; 

2. Consumer service address; 

3. Consumer email address supplied to the Verifier and NLAD; 

4. Qualifying program information; 

5. Whether the consumer was qualified using National Verifier database 

connections or manual review; and 

6. Date and time of the consumer’s National Verifier approval/qualification. 

OIG made clear the information listed above should be shared with a provider only after 

a successful customer enrollment transaction. 

In addition, OIG made two recommendations related to NLAD data integrity. First, we 

recommended that complete qualifying program information be recorded in NLAD for all 

consumers including consumers qualified based on Lifeline program participation. 

Second, we recommended that if a provider de-enrolls a consumer due to fraud 

concerns and USAC agrees with the provider’s justification, USAC should revoke the 

consumer’s National Verifier application and qualification. A Lifeline or ACP consumer 

de-enrolled for fraud concerns should be required to reapply to qualify for program 

support. 

We look forward to a response from the Commission and will update Congress 

accordingly. 

OIG Recommends Revision of the Commission‘s ACP Service Transfer Rules 

On March 29, 2023, OIG made a presentation to the Wireline Competition and 

Enforcement Bureaus regarding unauthorized and abusive transfers of subscribers’ 

ACP service benefits by providers without obtaining the consent of subscribers who are 

already enrolled with preferred providers. These unauthorized transfers result in 
FCC OIG—Semiannual Report to Congress 18 10/1/22 – 03/31/23

monetary losses to the ACP as well as the loss of ACP benefits to subscribers. Also, 

OIG sent a referral to the Bureaus on March 23, 2023, recommending that the Bureaus 

consider suspending and removing from the program a provider engaging in these 

unauthorized benefit transfers. 

Since the initiation of the EBB Program and its successor ACP, OIG has monitored 

subscriber complaints to the Commission and USAC regarding the unauthorized 

transfer of ACP benefits by providers. The FCC and USAC continue to receive many 

complaints about this practice. 

The ACP transfer rules limit a subscriber to one transfer of their ACP benefit per month, 

subject to four exceptions. Transfers made pursuant to these four exceptions are not 

subject to a limit, and USAC’s current transfer procedure does not require a provider to 

furnish proof of a subscriber’s consent. OIG advised the Bureaus that some ACP 

providers abuse transfer exceptions to make further unauthorized transfers. These 

providers file applications to transfer a subscriber’s benefit without the subscriber’s 

authorization and use a transfer exception to process the application with USAC. In 

some cases, transfer exceptions are used for more than half of a provider’s overall 

transfers, and subscribers obtained through transfer exceptions constitute a high 

percentage of these providers’ overall ACP subscribers. Many of these providers simply 

transfer ACP subscribers among themselves multiple times a month. 

When a subscriber’s benefit is transferred to an abusive ACP provider without consent, 

the subscriber’s preferred ACP provider automatically cancels the subscriber’s ACP 

benefit and bills the subscriber at its standard rate for their service. The abusive 

provider may file a claim for providing ACP service to the subscriber. It takes at least a 

month, and in some cases more, before a subscriber can transfer back to their preferred 

provider’s service. In the interim, the subscriber must pay the preferred provider’s rate 

for their broadband service without the ACP discount. Until the ACP benefit is reversed, 

ACP funds are likely paid out to the abusive provider when the subscriber is not likely 

receiving the abusive provider’s broadband service. 

OIG recommended the ACP transfer process be modified so that providers cannot 

easily circumvent controls to prevent the practice of unauthorized ACP transfers, and 

further, consider suspending and ejecting those providers engaging in this egregious 

conduct from the ACP, as well as other policy and rules modifications. We also 

reiterated our recommendation, first made when the Commission drafted the ACP rules, 

that USAC validate all consumer enrollments and transfers using the contact 

information supplied by the subscriber during the enrollment process. 
FCC OIG—Semiannual Report to Congress 19 10/1/22 – 03/31/23

OIG’s Duplicate BQP Agent Lockout Recommendation 

As noted in our last SAR, in September 2022, OI issued a public advisory regarding a 

fraud scheme in which agents at several ACP providers repeatedly used the same 

BQP’s PII to enroll numerous households in ACP. Most households are eligible for ACP 

support based on the subscriber’s own participation in a qualifying federal program like 

the Supplemental Nutrition Assistance Program or Medicaid. Other subscribers are 

eligible through a BQP—another household member, such as a child or dependent, who 

meets one of the ACP eligibility requirements. Subscribers who apply for ACP support 

based on a BQP’s eligibility are required to furnish certain BQP’s PII to the National 

Verifier and NLAD as part of the ACP verification and enrollment processes. Fewer than 

a hundred providers’ agents were responsible for the majority of these fraudulent 

enrollments. 

Following that advisory, OI recommended USAC lock out the agents involved in this 

misconduct. When USAC “locks out” an agent, the agent can longer access the 

National Verifier or NLAD, two USAC systems essential to enroll program beneficiaries. 

In all, OI identified 96 agents as involved in the creation of multiple duplicate BQP 

enrollments. 

In October 2022, after OI shared its findings with USAC, USAC issued lockouts to 34 

agents involved in creating duplicate BQP enrollments. Collectively, these 34 agents 

were responsible for creating over 4,700 ACP enrollments using duplicative BQP 

identities. One of the agents used one child’s PII to fraudulently enroll over 740 

subscribers in Tulsa, Oklahoma. 

In November 2022, OI further recommended USAC lockout an additional 62 agents 

based upon evidence showing their Representative Accountability Database (RAD) IDs 

were used to create multiple ACP enrollments using duplicative BQP PII. In January 

2023, USAC locked out 54 of these agents for their roles in creating ACP enrollments 

using duplicate BQPs. USAC also shared its reasoning for not locking out the remaining 

eight agents at this time. Collectively, these 54 agents were responsible for creating 

over 1,300 fraudulent ACP enrollments using duplicative BQP identities. This brought 

the total number of agents USAC has locked out for BQP misconduct to 88. In total, 

USAC has locked out 330 agents since 2020; more than half the lockouts were a result 

of OI’s investigative findings. 
FCC OIG—Semiannual Report to Congress 20 10/1/22 – 03/31/23

Ongoing Investigations 

Longtime Lifeline Agent Sentenced After Conviction for Conducting a Criminal 

Enterprise and Identity Theft in Michigan 

On February 17, 2023, Dewan Williams was sentenced to 2 to 20 years in the Michigan 

Department of Corrections and ordered to pay restitution after pleading guilty to charges 

of conducting a criminal enterprise and identity theft. Williams, a longtime sales agent 

for multiple Lifeline providers, used stolen personal information to fraudulently enroll 

unsuspecting victims into the Lifeline program and obtain free wireless phones 

provisioned with Lifeline service. Williams later sold the illegally obtained wireless 

phones for personal profit. Investigators recovered 150 new and pre-packaged Safelink 

wireless phones as well as the stolen personal information of approximately 7,000 

identity theft victims from his home. OIG assisted the investigation conducted by the 

Michigan Department of Attorney General, the Michigan Department of Health and 

Human Services, the State of Michigan OIG, and Michigan State Police. 

E-Rate and Emergency Connectivity Fund Programs 

Proactive Work 

Creation of an Online Competitive Bid Repository within EPC 

On January 27, 2022, the Commission released its Notice of Proposed Rulemaking 

(NPRM) seeking comments on establishing a competitive bid repository. The OIG first 

brought this issue to the agency’s attention in January 2017. See SAR April 1, 2017 – 

Sept. 30, 2017. OI has been monitoring the filings in this proceeding, which have been 

generally against the proposed bid repository. However, on August 16, 2022, the DOJ 

Antitrust Division filed an ex parte comment in the proceeding, recommending the 

Commission adopt the proposal. In part, the Antitrust Division stated to best protect the 

E-Rate program’s competitive process, real-time, centralized, electronic collection of 

pre-award bids and bid selections should occur, which would allow for more robust 

enforcement of the laws designed to protect the E-Rate program’s public procurement 

process and enhance the program’s integrity, including the investigation and 

prosecution of antitrust and related crimes related to E-Rate procurements. OI has 

learned the Commission is currently drafting recommendations related to the 

competitive bidding portal and ascertaining the feasibility of making a portal available by 

the goal stated in the NPRM of funding year 2024.

Suspension and Debarment Recommendation 

In numerous previous SARs, OI has explained the importance of the FCC establishing a 

more robust suspension and debarment program similar to those in most other federal 

agencies. Currently, suspension and debarment actions at the Commission are 
FCC OIG—Semiannual Report to Congress 21 10/1/22 – 03/31/23

extremely limited and only occur in instances where a criminal conviction or civil 

judgment arising out of activities associated with or related to the USF has occurred. 

The limited nature of this criteria hamstrings both OI and the Commission’s efforts to 

protect the USF from non-responsible persons and entities. 

The Commission issued a “Modernizing Suspension and Debarment Rules” NPRM in 

November 2019, and the Notice was published in the Federal Register on January 14, 

2020. The Commission collected comments and reply comments on its proposed 

Suspension and Debarment rules through March 16, 2020. As requested by the 

Commission, in September 2020, OI provided additional information to the Commission 

following the close of the comment period. OI was informed progress had been made 

on the Suspension and Debarment rulemaking during this reporting period and 

expected the Commission to issue rules and regulations. However, no final action has 

yet been taken by the Commission. 

As noted in the last reporting periods, on April 30, 2019, OI become aware of 

Commission activity granting multiple appeals filed by two schools in the E-Rate 

program, seeking additional time to respond to USAC requests for information. 

Individuals associated with these two schools have either been found guilty of federal 

program fraud or work for an E-Rate consultant who is currently under indictment for ERate program fraud. If a robust suspension and debarment program existed at the 

Commission, it may have prevented these schools from receiving funding from the 

Program. 

By way of example of the immediate need for updated suspension and debarment rules, 

OI staff working on an active investigation were queried by a prosecutor as to why FCC 

was unable to suspend or debar individuals and companies who appeared to be not 

presently responsible. OI explained FCC’s rules only permit suspension or debarment 

after a civil judgment when a defendant admits liability or following criminal convictions 

for certain activities. OI is concerned that funding from FCC programs continue to be 

paid out in circumstances when OI would have sought suspension or debarment if a 

robust program were in effect. 

Additionally, especially with respect to the new subsidy programs at the FCC, the 

Commission is unable to take steps to protect itself from irresponsible actors who seek 

to take advantage of new funding sources. OI’s recent work regarding the ECF has 

revealed certain matters where suspension and/or debarment might be appropriate. It is 

imperative that the Commission join much of the rest of the government and adopt 

robust and effective suspension and debarment rules. 

Notification Process for Cancelled FCC Form 470

As noted in the last reporting period, OI became aware USAC does not employ a 

mechanism to notify service providers when an applicant seeks to or has cancelled its 
FCC OIG—Semiannual Report to Congress 22 10/1/22 – 03/31/23

FCC Form 470. OI informed the FCC WCB of this recommendation on April 1, 2019, 

and was informed by FCC Office of Managing Director (OMD) in December 2019 that 

FCC staff have started the process of looking into the feasibility of adding a status field 

for the FCC Form 470 when it has been cancelled. OMD’s most current update to OI is 

FCC staff have been discussing the issue with USAC and are awaiting feedback on 

technical challenges or other considerations. OI has not received an update since that 

time regarding its recommendation. 

Anti-Corruption Coalition 

OIG joined the Eastern District of Louisiana Anti-Corruption Coalition and attended its 

inaugural meeting. The Coalition consists of over 25 local, state, and federal agencies 

focused on identifying, investigating, and eliminating corruption in the Eastern District of 

Louisiana. The Coalition will allow OIG and the participating member agencies to work 

together as a force multiplier to maximize resources and protect the integrity of public 

money. 

Ongoing Investigations 

OI’s E-Rate Investigations team continues its work on ongoing investigations of E-Rate 

service providers, recipients, and consultants. OI has continued to open new 

investigations and has been assisting the DOJ and United States Attorney’s Offices 

around the country to pursue civil and criminal fraud cases in the E-Rate program. The 

E-Rate Investigations team has expanded its area of responsibility to include 

investigations in the RHC Program, ECF, Contributions matters and the EBB Programs. 

New York Based Service Providers, Consultants and School Officials 

Our nearly decade long joint investigation with the FBI and the Rockland County District 

Attorney’s Office concerning fraudulently obtained E-Rate funds culminated during this 

reporting period. Peretz Klein, Ben Klein, Moshe Schwartz, Simon Goldbrener, Sholem 

Steinberg, Aron Melber, and Susan Klein previously pled guilty in White Plains federal 

court to one count of conspiring against the United States to defraud the E-Rate 

program. 

The schools at issue in this case never received millions of dollars’ worth of equipment 

and services for which the defendants billed the E-Rate program. In some instances, 

the schools and the defendants requested hundreds of thousands of dollars of 

sophisticated technology that served no real purpose for the student population. For 

example, from 2009 through 2015, one day care center that served toddlers from the 

ages of two through four requested over $700,000 – nearly $500,000 of which was 

ultimately funded – for equipment and services – including video conferencing and 

distance learning, a “media master system,” sophisticated telecommunications systems 

supporting at least 23 lines, and high-speed internet – from companies controlled by 
FCC OIG—Semiannual Report to Congress 23 10/1/22 – 03/31/23

certain defendants. In still other instances, the schools received equipment and services 

that fulfilled the functions for which the schools had requested E-Rate funds (such as 

providing the school with internet access), but the schools and the defendants materially 

overbilled the E-Rate program for the items provided to enrich themselves at the 

expense of the underprivileged children the program was designed to serve. 

The defendants also perverted the fair and open bidding process required by the E‐Rate 

program. Defendants who held themselves out as independent consultants working for 

the schools, in truth worked for and were paid by other defendants who controlled 

vendor companies. These defendants presented the schools with forms to sign or 

certify, awarding E-Rate funded contracts to companies owned by several defendants. 

As a result of false and misleading filings, the defendants received millions of dollars in 

E-Rate funds for equipment and services that they did not, in fact, provide and which 

the schools did not use, and the defendants purporting to act as consultants accepted 

payments totaling hundreds of thousands of dollars from the vendors, despite falsely 

presenting themselves as independent of the vendors. 

In return for their participation in the scheme to defraud the E‐Rate program, schools 

and school officials received a variety of improper benefits from certain defendants, 

including a percentage of the funds fraudulently obtained from E-Rate for equipment 

and services that were not, in fact, provided to the schools; free items paid for with ERate funds but not authorized by the program, such as wireless phones for school 

employees’ personal use and alarm systems and security equipment (which the E-Rate 

program does not authorize) installed at the schools; and free services for which the ERate program authorizes partial reimbursement (such as internet access) but for which 

the schools did not – contrary to their statements in filings – make any payment at all. 

Peretz Klein, Moshe Schwartz, and Susan Klein were sentenced during the previous 

SAR period. The following is a summary of the remaining four defendants and the 

sentences they received:

Ben Klein, 43, of Monsey, New York, was sentenced on October 19, 2022, to 27 

months in prison followed by 24 months of supervised release and was ordered 

to forfeit $275,160.00 and to pay restitution of the same amount. Ben Klein held 

himself out as multiple vendors to schools participating in the E-Rate program. In 

his guilty plea, Ben Klein admitted the companies he controlled did not in fact 

provide much of the equipment for which he billed the federal government. 

Simon Goldbrener, 59, of Monsey, New York, was sentenced on November 7, 

2022, to 24 months in prison followed by 24 months of supervised release and 

was ordered to forfeit $479,357.18 and to pay restitution of the same amount. 

Goldbrener held himself out as a consultant, supposedly helping schools to 

participate in the E-Rate program by, among other things, holding a fair and open 

bidding process to select cost-effective vendors. Goldbrener admitted he was 
FCC OIG—Semiannual Report to Congress 24 10/1/22 – 03/31/23

paid hundreds of thousands of dollars by vendors to complete and file false ERate documents that circumvented the bidding process and resulted in the 

payment of millions of dollars to those vendors 

Sholem Steinberg, 43, of Monsey, New York, was sentenced on November 7, 

2022, to 12 months and one day in prison followed by 24 months of supervised 

release and was ordered to forfeit $191,423.50 and to pay restitution of the same 

amount. Steinberg held himself out as multiple vendors to schools participating in 

the E-Rate program. In his guilty plea, Steinberg admitted the companies he 

controlled did not in fact provide much of the equipment for which he billed the 

federal government. 

Aron Melber, 47, of Monsey, New York, was sentenced on February 28, 2023, to 

nine months in prison followed by 24 months of supervised release and was 

ordered to forfeit $127,654.55 and to pay restitution of the same amount. Melber 

was an official at a private religious school in Rockland County, New York that 

participated in the E-Rate program with some of the defendants. Melber admitted 

that he filed false certifications with the E-Rate program, falsely claiming to have 

obtained authorized E‐Rate funded equipment and services from vendors 

selected through a fair and open bidding process. 

Former Kentucky Based Vendors 

On February 9, 2022, Charles A. “Chuck” Jones of Murray, Kentucky pled guilty to one 

count of conspiracy to commit wire fraud pursuant to a plea agreement. Jones pled 

guilty to a decade-long scheme and conspiracy to defraud the E-Rate program. Jones 

paid kickbacks to a Tennessee-based E-Rate consultant, which corrupted the required 

fair and open competitive bidding process. On March 12, 2023, the Court sentenced 

Jones to 18 months imprisonment, followed by three years of supervised release. The 

Court also ordered Jones to pay $3.5 million in restitution to USAC, with payments 

made in regular monthly installments consisting of 20% of his gross monthly income. 

The sentencing of one of Jones’s co-conspirators, Mark J. Whitaker also of Murray, 

Kentucky, is now set for June 5, 2023. Whitaker pled guilty in federal court in Memphis, 

TN in February 2020 to concealing the decade-long E-Rate program wire fraud scheme 

(18 U.S.C. § 4) and admitted to actively concealing a scheme by his co-conspirator, 

Jones, to defraud the E-Rate program. 

Referrals to Enforcement Bureau and USAC 

OI continues to track the progress made by the Enforcement Bureau and USAC 

concerning the various referrals OI provided for possible enforcement action. The 

majority of matters referred to the Enforcement Bureau and USAC are still pending. 
FCC OIG—Semiannual Report to Congress 25 10/1/22 – 03/31/23

Emergency Connectivity Fund 

OI has devoted a significant amount of staff time and resources during this reporting 

period to ensure program funds are utilized appropriately by the intended beneficiaries. 

During the past reporting period, OI received ECF data from USAC. OI completed its 

evaluation of this data in the current reporting period, and based on that evaluation 

began collecting documentation from selected schools and libraries participating in the 

program. Based on the evaluation of documentation collected, OI staff and its 

contracted staff have conducted site visits at approximately 60 schools and libraries to 

verify equipment, interview school and library staff and understand how the program is 

operating. 

OI’s work has revealed problems with ECF rule compliance, such as failure to develop 

or maintain the required asset and service inventories or to have documentation of 

unmet or actual needs. As these problems have appeared, OI has reported them to the 

FCC WCB. OI also observed a double payment on an invoice to a program beneficiary. 

OI brought this issue to USAC’s attention so USAC can seek to recover funding. On 

March 1, 2023, WCB released a PN reminding participants in the ECF of their ongoing 

compliance obligations. The issues raised in this PN were directly related to OI’s 

reported observations during its site visits. OI has referred additional issues to WCB and 

plans to refer additional issues if they are observed in additional OI site visits. OI, 

however, has not referred all matters to the WCB and is investigating several matters 

found during site visits. If OI determines these matters do not rise to the level of fraud, 

OI will refer them to WCB for administrative remedies. 

Rural Health Care Program 

OI staff are devoting substantial amounts of time and resources on matters involving the 

RHC program. Due to delays outside OI’s control, OI anticipates it can report on the 

results of at least some of this work in the next reporting period. 

COVID-19 Telehealth Program 

OI has moved forward to collect data to evaluate program integrity. OI anticipates the 

collection and evaluation of program data for risk factors of fraud, waste, and abuse to 

begin in the next reporting period. Based upon the results of OI’s evaluation, OI may 

take various steps, such as conducting site visits (as with the ECF), open preliminary 

investigations, or refer matters to WCB for administrative review. OI has also made 

various suggestions to OA for possible audits within this program.
FCC OIG—Semiannual Report to Congress 26 10/1/22 – 03/31/23

Contributions 

OI staff have continued to review data from service provider contributions to the USF 

and have developed concerns related to the failure of certain entities to provide their 

required contributions into the Fund. OI has continued to expend resources to 

investigating these matters during the current reporting period. Additionally, OI has 

shared certain concerns with OA to assist OA to develop an audit plan to evaluate 

contributors to the fund. 

OI Data Analytics Efforts 

OI’s data team continues to proactively pursue potential fraud, waste, and abuse of the 

USF as well as the Congressionally appropriated subsidy programs. During this 

reporting period, OI’s data analysts continued conducting proactive review of ECF data 

identifying potentially high-risk recipients based on predetermined factors. OI utilized the 

results of this analysis to initiate site visits and plans to rely in large part on the 

information generated to guide future ECF investigations. 

OI has also continued testing ACP and E-Rate data to identify potentially fraudulent 

behavior. In addition, we have supported multiple ongoing criminal investigations and 

undertaken efforts to further our data analysis of other FCC programs. 

 

Internal Affairs 

The IG is authorized by the IG Act, as amended, to investigate allegations of fraud, 

waste, and abuse occurring in FCC operations. Matters of possible wrongdoing are 

referred to OIG in the form of allegations or complaints from a variety of sources, 

including FCC employees, contractors, other government agencies, and the general 

public. 

Office of Inspector General Hotline

OIG maintains a Hotline to facilitate the reporting of allegations of fraud, waste, abuse, 

mismanagement, or misconduct in FCC programs or operations. Commission 

employees and concerned citizens may report such allegations to the Hotline at (202) 

418-0473 or toll free at (888) 863-2244 or by e-mail at hotline@fcc.gov. OIG’s Hotline is 

available 24 hours a day, seven days a week via a recorded messaging system. 

Many of the allegations received by the Hotline raise issues that do not fall within the 

jurisdiction of the FCC or the OIG, and many do not rise to the level of devoting 

investigative or audit resources to the claim. Upon receipt of a specific claim of fraud, 

waste, abuse, or mismanagement, OIG may, where appropriate, take any one of the 

following actions: 
FCC OIG—Semiannual Report to Congress 27 10/1/22 – 03/31/23

1. Open an OIG investigation or audit. 

2. Refer the matter to an FCC Bureau or Office for appropriate review and action. 

3. Refer the allegation to another federal agency. For example, complaints about 

fraudulent sweepstakes are referred to the Federal Trade Commission (FTC). 

Consumers who have general questions, consumer complaints, or issues not related to 

fraud, waste, and abuse, should contact the FCC’s Consumer & Governmental Affairs 

Bureau (CGB) at www.fcc.gov/cgb, or contact the FCC’s Consumer Center by calling 1-

888-CALL-FCC (1-888-225-5322) voice or 1-888-TELL-FCC (1-888-835-5322). CGB 

develops and implements the Commission’s consumer policies, including disability 

access. The FCC Consumer Center processes public inquiries, informal complaints, 

and questions regarding cable, radio, satellite, telephone, television, and wireless 

services. The goal of this process is to foster a mutually satisfactory resolution of the 

complaint between the service provider and its customer. 

 

During the current reporting period, OIG received: 

1. 18,882 Hotline contacts. Of these, none were referred to OIG for possible case 

opening. 

2. 263 were referred to FCC Consumer Center or other FCC Bureaus. 

3. 355 were referred to other agencies.
FCC OIG—Semiannual Report to Congress 28 10/1/22 – 03/31/23

OFFICE OF AUDIT 

Under the authority of the IG Act of 1978, as amended, the Office of Audit (OA) 

conducts or contracts for independent and objective audits, inspections, evaluations, 

and other related projects. OA staff is responsible for monitoring, planning, and 

executing projects that cover all areas of the Commission’s activities. 

OA projects are designed to monitor efforts and activities undertaken to meet the 

agency’s goals and mission, and to assess how the Commission's rules and regulations 

are being implemented by beneficiaries and other program participants. These projects 

promote economy, effectiveness, and efficiency in FCC programs and operations, and 

detect and deter fraud, waste, and abuse. OA projects are conducted in accordance 

with relevant professional standards, including Generally Accepted Government 

Auditing Standards (also known as Government Auditing Standards or the Yellow Book) 

and CIGIE Quality Standards for Inspection and Evaluation (Blue Book). 

OA is organized into three divisions: 

• the Operations, Financial, and Information Technology Division (OFID), 

• the Universal Service Fund Division (USFD), and 

• the Policy and Quality Assurance Division (PQAD). 

OFID and USFD perform audits, evaluations, inspections, and other projects. Because 

of limited resources we staff our projects using a combination of OA personnel and 

contracted audit specialists. All contracted OA projects are closely monitored by OA 

personnel to ensure project objectives and applicable engagement standards are met. 

Our oversight approach assures that OA staff are fully versed in all FCC program areas, 

and it ensures that OA staff provide timely and adequate input and review of all issues 

identified by the contract auditors. Additionally, OFID and USFD select and conduct 

projects using a risk-based approach. OA has determined that projects concerning ECF, 

Telehealth, and Broadband mapping meet our risk-based criteria; our plan is to staff 

these projects as resources become available through recruitment or as staff complete 

ongoing projects. Additional information regarding completed, other planned projects, 

and ongoing projects are included in the division sections below. 

The PQAD develops OA policies and procedures, performs internal quality assurance 

reviews to ensure OA compliance with applicable professional standards, coordinates 

external peer reviews of the FCC OIG by other OIGs, and leads external peer reviews 

of other OIGs in accordance with CIGIE guidance. 

Operations, Financial, and Information Technology Division 

OFID conducts mandatory and discretionary audits, inspections, and evaluations of 

FCC programs and operations. OFID’s annual mandatory projects include the annual 
FCC OIG—Semiannual Report to Congress 29 10/1/22 – 03/31/23

Financial Statement audit, the Federal Information Security Management Act (FISMA) 

evaluation, and the Payment Integrity Information Act (PIIA) audit. OFID performs other 

periodic mandated projects such as those related to the COVID-19 pandemic response, 

the Commission’s privacy and data protection initiatives, and the government charge 

card program. 

OA contracts with Independent Public Accountant (IPA) firms for many of the mandatory 

projects. OFID uses a risk-based approach to select discretionary projects and, as 

noted above, depending on available staffing and other resources, may complete the 

projects in-house or contract the work to IPA firms. OFID discretionary projects can 

include multiple areas of FCC operations. For example, the division is currently 

preparing to review the Supply Chain reimbursement program which was established by 

the Secure and Trusted Communications Networks Act of 2019. 

OFID completed two projects during this reporting period. Three OFID projects are in 

process. The results of the in-process projects will be summarized in a future semiannual report. 

Completed OFID Projects 

Fiscal Year 2022 Consolidated Financial Statement Audit (Report No. 22-AUD-06-01)

Federal law requires the FCC to prepare annual consolidated financial statements and 

the OIG to audit those statements. Under the oversight of OA, Kearney & Company 

(Kearney) performed an audit of the FCC’s Fiscal Year (FY) 2022 consolidated financial 

statements. As a result of Kearney’s audit, three reports were issued, dated November 

15, 2022. 

In the Independent Auditor’s Report on the Financial Statements, Kearney expressed 

an unmodified opinion. In the Report on Compliance and Other Matters, Kearney did not 

report any instances of noncompliance. 

In the Report on Internal Controls over Financial Reporting, Kearney reported one 

significant deficiency related to IT controls for FCC and the USF. The significant 

deficiency was a repeat issue from FY 2021 and prior year audit reports. 

Kearney made 21 recommendations to improve the effectiveness of IT controls over 

FCC and USAC. The details of the IT findings and recommendations were included in 

the separate FISMA evaluation report. FCC management concurred with all the findings 

and recommendations cited in the report. 
FCC OIG—Semiannual Report to Congress 30 10/1/22 – 03/31/23

Fiscal Year 2022 Federal Information Security Modernization Act Evaluation 

(Report No. 22-EVAL-06-01)

The FISMA legislation requires federal agencies to develop, document, and implement 

an agency-wide program to provide information security for the information and 

information systems supporting the operations and assets of the agency. FISMA also 

requires agency IGs to conduct or contract for an independent evaluation of the 

agency’s information security program annually. Under the oversight of OIG, Kearney 

performed the FY 2022 FISMA evaluation. Based on their results, the OIG submitted 

the completed FY 2022 DHS IG FISMA Metrics questionnaire for government-wide 

reporting to Congress on July 29, 2022, and subsequently at the end of the fiscal year. 

The OIG issued the non-public version of the FY 2022 FISMA Evaluation Report on 

February 28, 2023, and published the public report on the FCC website on March 15, 

2023. 

The evaluation report includes eight findings and offers 21 recommendations intended 

to improve the effectiveness of the FCC’s information security program controls. 

Kearney assessed the FCC’s security processes related to the five high-level NIST 

Cybersecurity Functions and determined that one function (Recover) was at a maturity 

Level 4, Managed and Measurable, meaning the function is considered effective; two 

functions (Identify and Respond) were at a maturity Level 3, Consistently Implemented, 

meaning the functions have been implemented but they lack measures of effectiveness; 

and two functions (Protect and Detect) were at a maturity Level 2, Defined, which 

means the functions are not consistently implemented agency-wide. Additionally, five of 

the eight findings address security weaknesses that were repeated or updated from 

prior year FISMA evaluations. 

In-Process OFID Audits and Other Projects 

FY 2022 Audit of the Federal Communications Commission’s Compliance with the 

Payment Integrity Information Act of 2019 2019 (Project No. 23-AUD-01-03)

The PIIA of 2019 (Public Law 116-117) requires OIGs to annually determine their 

respective agency’s compliance with the statute. Under the oversight of OA, a 

contractor was engaged to audit the payment integrity information of the FCC included 

in its FY 2022 Agency Financial Report (AFR) and posted on 

www.paymentaccuracy.gov. The objective of the audit is to determine FCC' s 

compliance with the PIIA. PIIA directs federal agencies and departments to undertake 

activities designed to reduce and recover improper payments. 
FCC OIG—Semiannual Report to Congress 31 10/1/22 – 03/31/23

FY 2022 Audit of the Federal Communications Commission’s Compliance with the 

Affordable Connectivity Program (Project No. 23-AUD-01-04)

As required by the Infrastructure Act, OIG engaged a contractor to audit FCC’s 

implementation of ACP. The overall objective of the audit is to determine if FCC 

implemented the ACP in accordance with the requirements of the Infrastructure Act. 

Specific objectives included the following: 

1. Determine whether FCC and USAC implemented effective internal controls to 

ensure ACP disbursements were made to eligible service providers for eligible 

ACP program participants, to reduce improper payments, and prevent and detect 

fraud, waste, and abuse; 

2. Determine whether FCC complied with agency oversight requirements for 

consumer complaint resolution and participating provider compliance as defined in 

Section 60502(9) Commission Oversight; 

3. Determine if the FCC conducted effective outreach efforts, as described in section 

60502 10 (C) Commission Outreach, to identify eligible households, encourage 

them to enroll in the ACP, and provide information on how to enroll; 

4. Determine whether FCC developed effective program goals and performance 

measures to accurately report the performance results of the ACP program; and 

5. Follow up on the status of recommendations reported in the prior OIG and GAO 

audits of the EBB Program. 

Privacy and Data Protection Inspection (Project No. 21-INSP-10-01) 

The objective of this Inspection is to determine whether the FCC has implemented 

effective privacy and data protection policies and procedures in accordance with federal 

laws, regulations, and policies, with a focus on FCC’s implementation of the nine 

requirements identified in 42 U.S.C. § 2000ee-2 Privacy and Data Protection Policies 

and Procedures. The Inspection includes a review of how effectively the FCC has 

implemented its data protection and privacy program during the period October 1, 2020, 

to September 30, 2021. 

Universal Service Fund Division 

The USFD performs audits, inspections, and surveys to review the administration of 

USF programs as well as selected fund recipients (telecommunications service 

providers and other beneficiaries). USFD is divided into three functional audit 

Directorates: Contributors and Lifeline; High Cost; and E-Rate and RHC. USFD audit 
FCC OIG—Semiannual Report to Congress 32 10/1/22 – 03/31/23

projects are designed to detect and prevent fraud, waste, and abuse, and promote 

economy, effectiveness, and efficiency in USF programs. USFD’s risk-based approach 

helps us pursue and plan projects which focus our limited resources on areas with the 

highest risk, in the most cost-effective manner. USFD communicates regularly with 

internal and external offices of the agency and USAC to coordinate projects and share 

information such as emerging program risks, prior audit results, data sources, testing 

tools, and new USF program developments and initiatives. The division is currently 

preparing one project: a review of the High-Cost Universal Broadband (HUBB) activities. 

USFD has four projects currently in process. Results will be summarized in a future 

semiannual report. 

In-Process USFD Audits and Other Projects 

Audit of USAC's Oversight of the USF Contributions Process 

(Project No. 23-AUD-05-01)

The objective of this performance audit is to determine whether internal controls over 

the USF payment process via the E-file system are effective, timely, and include all 

eligible service providers. 

 

FY 2019 & 2020 Audit of New River Valley Community Services 

(Project No. 23-A-02-01) 

The objective of this performance audit is to determine whether New River Valley 

Community Services complied with Title 47 of the Code of Federal Regulations (C.F.R.) 

§§ 54.601 - 54.607, 54.619 - 54.633. Additionally, the audit evaluates the beneficiary's 

compliance with FCC rules and orders for RHC providers relevant to the audit objective. 

FY 2019 & 2020 Audit of Mt. Rogers Community Services (Project No. 23-AUD-02-02) 

The objective of this performance audit is to determine whether Mt. Rogers Community 

Services complied with 47 C.F.R. §§ 54.601 - 54.607, 54.619 - 54.633. The audit also 

includes one evaluation of the beneficiary's compliance with FCC rules and orders for 

RHC providers relevant to the audit objective. 

E-Rate – FY 2020 Audit of Orange County Public Library (Project No. 22-AUD-11-03) 

The objective of this performance audit is to determine if the Orange County Public 

Library system complied with FCC rules and orders applicable to the E-Rate program. 

The audit also includes an evaluation of the beneficiary’s internal controls applicable to 

the objective. 
FCC OIG—Semiannual Report to Congress 33 10/1/22 – 03/31/23

REPORTING REQUIREMENTS 

The SAR questions were updated to comply with the OIG 16 reporting requirements for 

the National Defense Authorization Act (NDAA) for FY 2023, Section 5273, which 

amends Section 5(a) of the IG Act. 

1. A description of significant problems, abuses, and deficiencies relating to the 

administration of programs and operations of the establishment and associated reports 

and recommendations for corrective action made by the Office. 

Please refer to sections of this report titled “Office of Audit” and “Office of 

Investigations.”

2. An identification of each recommendation made before the reporting period, for which 

corrective action has not been completed, including the potential costs savings 

associated with the recommendation. 

See Appendix A1. OI Unimplemented Recommendations and 

See Appendix A2: OA Unimplemented Recommendations. 

3. A summary of significant investigations closed during the reporting period. 

Please refer to sections of this report titled “Office of Investigations.”

4. An identification of the total number of convictions during the reporting period 

resulting from investigations. 

During this reporting period, no convictions resulted from investigations. 

5. Information regarding each audit, inspection, or evaluation report issued during the 

reporting period, including— 

(A) a listing of each audit, inspection, or evaluation; 

(B) if applicable, the total dollar value of questioned costs (including a separate 

category for the dollar value of unsupported costs) and the dollar value of 

recommendations that funds be put to better use, including whether a 

management decision had been made by the end of the reporting period. 

Please refer to the sections of this report titled “Office of Audit.” 

6. Information regarding any management decision made during the reporting period 

with respect to any audit, inspection, or evaluation issued during a previous reporting 

period. 
FCC OIG—Semiannual Report to Congress 34 10/1/22 – 03/31/23

See Appendix B: Reports Issued in Prior Periods for which a Management Decision is 

Pending as of March 31, 2023.

7. The information described under section 804(b) of the Federal Financial Management 

Improvement Act of 1996. 

No report required by 804(b) of the Federal Financial Management Improvement Act of 

1996 was issued during this reporting period. 

8. (A) An appendix containing the results of any peer review conducted by another 

Office of Inspector General. 

(B) If no peer review was conducted within the reporting period, a statement identifying 

the date of the last peer review conducted by another Office of Inspector General. 

(A) No peer reviews were conducted within the reporting period. 

(B) On May 27, 2022, the Export-Import Bank of the United States (EXIM) Office of 

Inspector General (EXIM OIG) OIG performed an Inspection and Evaluation peer review 

to determine the FCC OIG compliance with CIGIE’s Quality Standards for Inspection 

and Evaluation (Blue Book) for the year ending September 30, 2021. EXIM OIG 

determined that the FCC OIG’s policies and procedures generally were consistent with 

Blue Book standards. 

On September 1, 2022, the Pension Benefits Guaranty Corporation Office of Inspector 

General (PBGC OIG) issued a modified peer review1 of the FCC OIG’s system of quality 

control for audit operations for the period ending March 31, 2022. 

See Appendix C: Peer Review Results, for further details.

9. A list of any outstanding recommendations from any peer review conducted by 

another Office of Inspector General that have not been fully implemented, including a 

statement describing the status of the implementation and why implementation is not 

complete. 

There are no outstanding recommendations from any peer review conducted by another 

Office of Inspector General. All recommendations from the 2 most recent peer reviews 

completed, EXIM I&E peer review and the PBGC Audit peer review, have been fully 

implemented. 

10. A list of any peer reviews conducted by the Inspector General of another Office of 

the Inspector General during the reporting period, including a list of any outstanding 

recommendations made from any previous peer review (including any peer review 

1 CIGIE requires a Modified Peer Review for OIGs that do not perform GAGAS engagements, but maintained audit 

policies and procedures in anticipation of performing such work. 
FCC OIG—Semiannual Report to Congress 35 10/1/22 – 03/31/23

conducted before the reporting period) that remain outstanding or have not been fully 

implemented. 

The FCC OIG conducted a peer review of the National Archives and Records 

Administration (NARA) OIG’s audit operations during the reporting period. The peer 

review report was issued on March 16, 2023, and NARA OIG received a “Pass” rating. 

The FCC OIG also issued a Letter of Comment with two findings and two 

recommendations. NARA OIG’s management concurred with the findings and 

recommendations and issued a memo initiating its corrective actions, effective March 6, 

2023. See Appendix C: Peer Review Results, for further details.

11. A statistical tables showing— 

(A) the total number of investigative reports issued during the reporting period; 

(B) the total number of persons referred to the Department of Justice for criminal 

prosecution during the reporting period; 

(C) the total number of persons referred to State and local prosecuting authorities for 

criminal prosecution during the reporting period; and 

(D) the total number of indictments and criminal information during the reporting period 

that resulted from any prior referral to prosecuting authorities 

(A) The “Office of Investigations” section contains the total number of investigative 

reports during the reporting period. 

(B) In this reporting period, six people, including one company and its principal, were 

referred to the Department of Justice for criminal prosecution. 

(C)No person was referred to State or local prosecuting authorities for criminal 

prosecution during this reporting period. 

(D)No indictment or criminal information was filed during the reporting period. 

12. A description of the metrics used for developing the data for the statistical tables 

under paragraph (11). 

The Office of Investigations issues “ investigative reports” to either (1) close an 

investigation or (2) refer a matter for administrative action or for pursuit of civil or 

criminal fraud. An “investigative report” refers to any document, including but not limited 

to a Report of Investigation, sufficient to close a case in OI’s Case Management 

System. We do not close a matter until it is finally resolved, that is until (a) action is 

taken by the Commission in an administrative referral, or until the civil or criminal 

referral is declined or resolved by the court or (b) it is determined that no further action 

is merited. 

13. A report on each investigation conducted by the Office where allegations of 

misconduct were substantiated involving a senior Government employee or senior 

official (as defined by the Office) if the establishment does not have senior Government 

employees or senior official, which shall include— 
FCC OIG—Semiannual Report to Congress 36 10/1/22 – 03/31/23

(A) the name of the senior Government employee, if already made public by the Office; 

and 

(B) a detailed description of— 

(i) the facts and circumstances of the investigation; and 

(ii) the status and disposition of the matter, including— 

(I) if the matter was referred to the Department of Justice, the date of the 

referral; and 

(II) if the Department of Justice declined the referral, the date of the 

declination. 

No investigation involving a senior government employee or senior official where 

allegations of misconduct were substantiated was conducted by the Office. 

14. (A) A detailed description of any instance of whistleblower retaliation, including 

information about the official found to have engaged in retaliation; and (B) what, if any, 

consequences the establishment imposed to hold that official described in 

subparagraph (A) accountable 

No findings of whistleblower retaliation were made during this reporting period. 

15. (A) A detailed description of any attempt by the establishment to interfere with the 

independence of the Office, including— 

(i) with budget constraints designed to limit the capabilities of the Office; and 

(ii) incidents where the establishment has resisted or objected to oversight 

activities of the Office or restricted or significantly delayed access to information, 

including the justification of the establishment for such action; and 

(B) a summary of each report made to the head of the establishment under section 

6(c)(2) during the reporting period. 

OIG experiences with attempts by FCC management to interfere with the independence 

of the Office are described on pages 9-10 and 11-13. 

16. A detailed descriptions of the circumstances of each— 

(A) inspection, evaluation, and audit conducted by the Office that is closed and was not 

disclosed to the public; and (B) investigation conducted by the Office involving a senior 

Government employee that is closed and was not disclosed to the public. 

(A) Lifeline Audit of Head Start, Inc. (Project No. 18-AUD-01-01)

On February 6, 2023, the OIG terminated the FY 2018 Lifeline Program Audit of 

Head Start, Inc (Project No. 18-AUD-01-01). The audit was initiated in May 2018. 

The audit objective was to determine whether claims for Lifeline program 

reimbursements by the telecommunications service provider, Head Start, Inc, were 

in accordance with 47 §§ C.F.R. 54.400- 54.423. The scope for the review included 
FCC OIG—Semiannual Report to Congress 37 10/1/22 – 03/31/23

reimbursement claims made from August 2016 through September 2017. We 

suspended the audit in February 2021 after the OIG’s Office of Audit experienced 

significant turnover and logistical challenges exacerbated by the COVID-19 

pandemic. We did not have the staff and resources to remobilize and complete 

additional testing to ensure the audit complied with Generally Accepted Government 

Auditing Standards (GAGAS). The audit was therefore terminated without issuing an 

audit report. 

Spruce Knob Seneca Rocks Telephone, Inc. HC Beneficiary 

(Project No. 18-AUD-08-07)

On February 7, 2023, the OIG terminated the performance audit of Spruce Knob 

Seneca Rocks Telephone, Inc. (Project No. 18-AUD-08-07). The audit was initiated 

in May 2018. The audit objective was to determine whether the Spruce Knob 

Seneca Rocks Telephone, Inc. complied with FCC Rules, regulations, and orders 

governing the High-Cost Program Connect America Fund for disbursements 

received by the company from January 1, 2017 through December 31, 2017. We 

suspended the audit in January 2022 after the OIG’s Office of Audit experienced 

significant turnover and logistical challenges exacerbated by the COVID-19 

pandemic. We did not have the staff and resources to remobilize and complete 

additional testing to ensure the audit complied with GAGAS. The audit was therefore 

terminated without issuing an audit report.

(B) No investigation was conducted involving a senior Government employee that is 

now closed and was not disclosed to the public. 
FCC OIG—Semiannual Report to Congress 38 10/1/22 – 03/31/23

APPENDIX A1 

OI Unimplemented Recommendations 

The following FCC OIG OI recommendations, for which corrective action has not been 

taken, are described in this SAR: 

Recommendations regarding Commission’s ACP Data 

Collection Order 

Please refer to page 15 of 

this report. 

OIG Recommendation Concerning Verifier Data to be 

Shared with Lifeline and ACP Providers 

Please refer to page 17 of 

this report. 

OIG Recommends Revision of the Commission‘s ACP 

Service Transfer Rules

Please refer to page 17 of 

this report. 

OIG’s Duplicate BQP Agent Lockout Recommendation Please refer to page 19 of 

this report. 

Creation of an Online Competitive Bid Repository 

within EPC

Please refer to page 20 of 

this report. 

Suspension and Debarment Recommendation Please refer to page 20 of 

this report. 

Notification Process for Cancelled FCC Form 470 Please refer to page 21 of 

this report. 

For descriptions of prior recommendations made by the FCC OIG OI, for which 

corrective action has not been completed, please refer to previous FCC OIG 

Semiannual Reports to Congress. 
FCC OIG—Semiannual Report to Congress 39 10/1/22 – 03/31/23

APPENDIX A2

OA Unimplemented Recommendations 

Information Technology recommendations are considered sensitive, and contain nonpublic information identified by FISMA reporting metrics domain2

 only. 

Project Code Project Title Report 

Issue Date 

Recommendation 

22-EVAL-06-01 FY 2022 FISMA 

Evaluation Report 

2/28/2023 1. Identity and Access Management 

2. Risk Management 

3. Configuration Management 

5. Identity and Access Management 

6. Identity and Access Management 

8. Risk Management 

12. Supply Chain Risk Management 

13. Configuration Management 

14. Identity and Access Management 

16. Identity and Access Management 

17. Risk Management 

18. Configuration Management 

19. Configuration Management 

20. Identity and Access Management 

22-AUD-01-01 Fiscal Year 2021 

Payment Integrity 

Information Act of 

2019 Performance 

Audit 

6/28/2022 9. Develop and implement a written improper 

(IP) and unknown payment (UP) risk 

assessment methodology that incorporates 

the Enterprise Risk Management (ERM) 

framework from Office of Management and 

Budget (OMB) Circular A-123, to assist in the 

identification and management of payment 

integrity risk and support whether the 

program is susceptible to making IPs and/or 

UPs. The methodology should include a risk 

scoring or weighting factor for each program 

and associated risk. 

14. Continue to enhance USACs applicant 

outreach program to educate applicants on 

the schools and libraries (S&L) program 

rules, especially rules relating to the 

competitive bidding processes. 

2

 The FISMA reporting metrics domains: 

• Risk management and supply chain risk management (SCRM); 

• Configuration management, identity, and access management (CAM), data protection and privacy, and security training; 

• Information security continuous monitoring (ISCM); 

• Incident response; and 

• Contingency planning.
FCC OIG—Semiannual Report to Congress 40 10/1/22 – 03/31/23

15. Enhance the use of automation tools in 

E-Rate Productivity Center (EPC) to check 

invoices for common errors and invoices that 

are flagged as high risk of non-compliance 

with program invoicing requirements. 

16. Work with the Chairwoman’s Office to 

formalize the improper payment by issuing a 

Forfeiture Order or Consent Decree. Report 

the amount from the binding agreement as 

an Improper Payment identified through 

recovery actions or report the full amount of 

$30 million as an overpayment identified 

through recovery activities. 

17. Once the settlement has been finalized, 

through the OMB annual data call, include 

measurable milestones to accurately report 

IP information on paymentaccuracy.gov if 

found non-compliant with OMB M-21-19. 

21-EVAL-06-01 FY 2021 FISMA 

Evaluation Report 

12/15/2021 5 Identity and Access Management 

21-AUD-10-01 FY 2021 FCC 

Emergency 

Broadband Benefit 

Program 

Performance Audit 

6/21/2022 1. Increase the scrutiny of the manual 

verification process, including implementing 

a multilevel review process that includes 

reviews of the supporting documentation in 

comparison to the application. 

2. Using results from the Payment Integrity 

Program, establish controls to ensure that 

the self-certifications provided by the 

Providers are validated by reviewing 

corroborating documentation that evidences 

an eligible claim before approving the 

payments. Examples are household eligibility 

proof, invoices for recurring service/ 

connected devices, Provider’s terms and 

conditions of service to determine there are 

no contradictions to program rules, and the 

election notice details or any other 

documentation that supports the claim for 

reimbursement. 

21-AUD-08-06 FY 2021 DATA Act 

Audit 

11/8/2021 1. Develop and implement FCC’s (Data 

Quality Plan) DQP policies and procedures 

for updating the DQP in accordance with the 

applicable guidance. Policies and procedures 

should address the timeframe in updating the 

DQP due to changes in the FCC’s 

processes, including component processes, 

and new or revised guidance from OMB, the 

Department of the Treasury (Treasury), or 

other authoritative sources. 
FCC OIG—Semiannual Report to Congress 41 10/1/22 – 03/31/23

2. Develop and implement policies and 

procedures to ensure FCC communicates 

new guidance to its components. This can 

include holding regular meetings with the 

components to ensure all new guidance is 

communicated and interpreted consistently 

across the FCC entity. 

3. Develop and implement oversight policies 

and procedures to ensure component entities 

report financial assistance awards timely. 

7. Coordinate with USAC management to 

develop and implement processes for 

obtaining all required data elements from 

awardees prior to issuing an award. This 

may include updating or creating program 

forms to include all required data elements 

needed for Financial Assistance Broker 

Submission (FABS) submission. 

8. Develop and implement oversight policies 

and procedures for monitoring data reported 

by component entities to ensure that all 

DATA Act information is being reported 

timely, accurately, and completely. 

20-EVAL-07-01 FY 2020 FISMA 

Evaluation Report 

12/22/2020 17. Identity and Access Management (This 

recommendation repeated each year since 

initially reported.) 

20-AUD-01-01 FY 2019 Improper 

Payments 

Elimination and 

Recovery 

Improvement Act 

(IPERIA) Compliance 

Audit 

6/15/2020 12. FCC Management develop policies and 

procedures that (a) acknowledge the 

interdependent relationships between FCC, 

the TRS Fund Administrator, and TRS 

providers; (b) address the responsibilities of 

each party to manage risks of IPs; and (c) 

describe methodologies used to obtain 

assurance that each party manages its risks 

of IPs appropriately and as intended. (This 

recommendation repeated each year since 

initially reported.) 

19-EVAL-07-01 FY 2019 FISMA 

Evaluation Report 

1/8/2020 4. Identity and Access Management (This 

recommendation repeated each year since 

initially reported.) 
FCC OIG—Semiannual Report to Congress 42 10/1/22 – 03/31/23

19-AUD-08-05 FY 2019 DATA Act 

Audit 

11/8/2019 2. Continue to coordinate with the TRS Fund 

administrator to develop a DATA Act project 

plan. The TRS Fund project plan should 

include an expected timeline and steps to 

implement necessary changes to systems 

and business processes to capture, link, 

reconcile, and report on award-level financial 

and spending information. The TRS Fund 

Administrator, in coordination with the FCC, 

should develop and execute a project plan 

that conforms with Steps 1 through 8 of the 

DATA Act Implementation Playbook (Version 

2.0). (This recommendation was repeated in 

FY21.) 

19-AUD-02-01 FY 2018 Improper 

Payments 

Elimination and 

Recovery 

Improvement Act 

(IPERIA) Compliance 

Audit 

6/3/2019 4. Modify the Payment Quality Assurance 

(PQA) assessment procedures to target 

USF- High Cost (HC) program rules and 

significant risks of improper payments. (This 

recommendation repeated each year since 

initially reported.) 

18-EVAL-07-01 FY 2018 FISMA 

Evaluation Report 

12/21/2018 3. Configuration Management (This 

recommendation repeated each year since 

initially reported.) 

11. Information Security Continuous 

Monitoring (This recommendation repeated 

each year since initially reported.) 

17-EVAL-07-01 FY 2017 FISMA 

Evaluation Report 

12/21/2017 3. Risk Management (This recommendation 

repeated each year since initially reported.) 

17-AUD-08-04 FY 2017 DATA Act 

Audit 

11/7/2017 2. As technical and operational issues arise 

during the USAC and Rolka DATA Act 

implementation, USAC and Rolka, in 

coordination with the FCC, should coordinate 

with OMB and Treasury to work through any 

issues in real time. The FCC should 

document all significant issues encountered 

that required OMB and Treasury 

involvement. Ensure that as technical and 

operational issues arise during the TRS Fund 

Administrator DATA Act implementation, the 

TRS Fund Administrator, in conjunction with 

the FCC, coordinates with OMB and 

Treasury to work through any issues in real 

time. The FCC should document all 

significant issues encountered that required 

OMB and Treasury involvement. (This 

recommendation was repeated in FY19 and 

FY21.) 

16-EVAL-06-01 FY 2016 FISMA 

Evaluation Report 

12/8/2016 11. Identity and Access Management. (This 

recommendation repeated each year since 

initially reported.) 
FCC OIG—Semiannual Report to Congress 43 10/1/22 – 03/31/23

15-AUD-10-09 Audit of National 

Lifeline 

Accountability 

Database 

3/26/2018 2.2. Require that USAC obtain written 

statements from state commissions and 

ETCs to confirm that their staff and agents 

who have NLAD access rights have 

successfully completed background 

investigations. 

15-AUD-10-09 Audit of National 

Lifeline 

Accountability 

Database 

3/26/2018 2.4. Require that USAC obtain written 

statements from state commissions, 

contractors, and ETCs confirming that their 

staff and agents who are granted access 

rights for NLAD have completed appropriate 

training to reduce the possibility that 

Personal Identifiable Information (PII) will be 

accessed, used, or disclosed inappropriately. 

13-AUD-12-29 FY 2014 Wireline 

Competition Bureau 

Audit 

6/14/2017 4.1. We recommend WCB develop and 

implement a plan that ensures the closure of 

pending appeals in a timely manner and 

prioritizes the resolution of appeals filed 2010 

and earlier. 

12-AUD-12-20 FY 2012 A-130 Audit 3/12/2014 4.1. Configuration Management 
FCC OIG—Semiannual Report to Congress 44 10/1/22 – 03/31/23

APPENDIX B

Reports Issued in Prior Periods for which a Management Decision is Pending 

as of September 30, 2022 

Report 

Number 

Project Title 

(Recommendation No.) Report Date Comments 

12-AUD-12-20

Audit of the FCC 

Compliance with OMB 

Circular No. A-130, Revised 

(Rec. No. 4.1) 

3/12/2014 

Management revised the target date 

from February 28, 2023 to December 1, 

2023. The most recent corrective action 

plan indicated that progress has been 

made but management has not 

demonstrated sufficient progress to 

implement the one remaining open 

recommendation The audit report 

contains nonpublic information, 

therefore the report was not posted to 

the OIG webpage. 

13-AUD-12-29

Performance Audit of the 

Federal Communications 

Commission Wireline 

Competition Bureau

(Rec. No. 4.1) 

07/31/2015 

Management did not meet the target 

date (September 30, 2022) detailed in 

the latest corrective action plan and has 

not made significant progress towards 

implementing this recommendation. 

Management informed OIG that it would 

seek approval from Office of the 

Chairman (OCH) to close this 

recommendation without 

implementation of corrective actions. 

OIG requested additional justification for 

closing the recommendation without 

remediation, including any 

consideration given to the risks 

associated with taking this action. No 

updated CAP or expected response 

date has been provided at this time. 

15-AUD-10-09

Performance Audit of 

Universal Service 

Administrative Company 

National Lifeline 

Accountability Database

(Rec No. 2.2 and 2.4) 

3/26/2018 

Two recommendations remain open 

from this audit report. After receiving 

several OIG extensions for the target 

completion dates. FCC management 

stated that they have made progress 

and will provide an updated corrective 

action plan. 
FCC OIG—Semiannual Report to Congress 45 10/1/22 – 03/31/23

APPENDIX C

Peer Review Results

The Inspector General Act of 1978, as amended, requires the OIGs to report the results 

of peer reviews of their operations conducted by other OIGs, including the date of the 

last peer review, outstanding recommendations from prior peer reviews, and peer 

reviews of other OIGs conducted during the semiannual period. Peer reviews are 

conducted by member organizations of the CIGIE. 

Office of Audit Peer Review Results 

On May 27, 2022, EXIM OIG assessed the extent to which the FCC OIG compiled with 

the seven covered Blue Book standards, specifically: Quality Control; Planning; Data 

Collections and Analysis; Evidence; Records Maintenance; Reporting; and Follow up for 

the year ending September 30, 2021. EXIM OIG determined that the FCC OIG’s 

policies and procedures generally were consistent with each of the seven Blue Book 

standards addressed in the external peer review. Of the two reports reviewed, both 

reports generally compiled with the seven covered Blue Book standards. No 

recommendations from the EXIM OIG or prior peer reviews remain outstanding. 

Office of Audit Peer Reviews of Other Office of Inspector General 

On March 16, 2023, the FCC OIG issued a report on the results of its peer review of the 

NARA OIG’s system of quality control for its audit operations. The FCC OIG determined 

that NARA OIG’s system of quality control in effect for the year ended September 30, 

2022, was suitably designed to provide reasonable assurance that it is performing 

audits and reporting the audit results in conformity with applicable professional 

standards in all material respects. NARA OIG received a peer review rating of “Pass.” 

The FCC OIG’s peer review letter of comment contained two recommendations that 

were designed to further strengthen the NARA OIG’s system of quality control. NARA 

OIG’s management concurred with the FCC OIG’s peer review findings and 

recommendations and issued a memo initiating its corrective actions, effective March 6, 

2023. 
FCC OIG—Semiannual Report to Congress 46 10/1/22 – 03/31/23

Office of Inspector General

Federal Communications Commission

45 L Street NE

Washington, DC 20554

. 

Report fraud, waste, and abuse.

Email: Hotline@FCC.gov

Call Hotline: 202-418-0473

Whistleblower Disclosure Hotline 

800-872-9855 or info@osc.gov