The FCC suspended seven individuals who have been convicted of fraud related to their participation in the E-Rate program. E-Rate helps schools and libraries to obtain affordable broadband.
Corporations controlled by these individuals sought over $35 million in E-Rate funds and received over $14 million from around 2010 to 2016, but did not provide much of the equipment for which they billed the federal government, according to the Commission. The FCC Enforcement Bureau suspended each entity from further participation in E-Rate and began proceedings to ban them from taking part in the future.
In a letter to each individual, Christopher Sova, Chief Investigations and Hearings Division of the Enforcement Bureau wrote: “You pleaded guilty to a wire fraud conspiracy that involved knowingly and willfully devising a scheme to obtain money from the E-Rate program fraudulently. For more than five years you posed as a Rockland County, New York-based independent educational consultant working for private religious schools that desired to participate in the E-Rate program. In fact, you worked with and for your coconspirators who acted as vendors to the same schools.”
“These programs have important purposes, and those purposes do not include enriching grifters,” said Enforcement Bureau Acting Chief Patrick Webre. “When it comes to misuse of American taxpayer money, we are not in a forgiving mood.”
The Department of Justice sentenced the seven individuals in 2023. They are: Peretz Klein, Ben Klein, Moshe Schwartz, Simon Goldbrener, Sholem Steinberg, Aron Melber, and Susan Klein.
FCC rules require the Enforcement Bureau to suspend them from participating in any activities related to the E-Rate program or any other federal universal service support mechanisms. Each party has 30 days to explain why they should not be banned for three years from the date of debarment – a time period which can be extended by the agency.
By Leslie Stimson, Inside Towers Washington Bureau Chief
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