Government Sues Sprint For Overcharging For Wiretaps Under CALEA
from the everybody-loses dept
As we just got done discussing, AT&T, Verizon and Sprint recently were able to dodge a long-running lawsuit alleging the companies have been dramatically overcharging the government for wiretaps for more than a decade. The lawsuit was filed by former New York Deputy Attorney General John Prather, who spent thirty years in the AG’s office (and six years on the Organized Crime Task Force in NY) helping to manage wiretaps and invoices for wiretap provisioning. Prather filed the suit on behalf of the U.S. government, but telco lawyers were able to have the suit dismissed by arguing that Prather couldn’t technically sue the telcos under the False Claim Act as a whistleblower, because he filed the original complaint while working for the government.
Now it appears that at least one of the telcos is being focused on for round two, with the news that the government is suing Sprint for overcharging for wiretaps under CALEA. Under CALEA phone companies are allowed to recoup “reasonable expenses,” but the lawsuit claims that Sprint overcharged the government to the tune of $21 million, overinflating charges by approximately 58 percent between 2007 and 2010. The Prather case claimed the telcos overcharge for taps in general, but have historically dodged culpability by simply hitting the government with large bills that don’t itemize or explain why a wiretap should magically cost $50,000 to $100,000.
Sprint appears to have been specifically nabbed by the Justice Department’s Inspector General because it wasn’t clever enough about passing on the costs of modifying its network to adhere to CALEA back to the government, something the law prohibits:
“Despite the FCC’s clear and unambiguous ruling, Sprint knowingly included in its intercept charges the costs of financing modifications to equipment, facilities, and services installed to comply with CALEA. Because Sprint’s invoices for intercept charges did not identify the particular expenses for which it sought reimbursement, federal law enforcement agencies were unable to detect that Sprint was requesting reimbursement of these unallowable costs.”
It should be interesting to see if AT&T and Verizon face similar lawsuits down the road, or if their lawyers and accountants were simply better at obscuring overbilling. It’s kind of a lose-lose scenario for you and me either way. Not only do we get to be spied on, we likely paid for these wiretaps both on the taxpayer side and on the telco side as the companies passed on both real and imaginary wiretap costs to you.