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An ISP Scam Targeted Low-Income People Seeking Government Aid

by lacygibson
July 8, 2022
in National, World
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An ISP Scam Targeted Low-Income People Seeking Government Aid
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The FCC said Traxler’s scam ran from May to August 2021, during which time he “repeatedly engaged in conduct that violated federal wire fraud statutes and Commission rules.”​​ The commission said the proposed forfeiture fine of $220,210 is “the statutory maximum we can impose and reflects the scope, duration, severity and seriousness of Cleo’s apparent violations.”

When Cleo applied to join the EBB program, the FCC initially told the entity that its application would be “denied because it lacked sufficient approval information.” But Cleo then gained approval from the FCC by providing documents that included copies of two invoices “with customer identifying information removed, which Cleo claims was ‘due to CPNI and privacy’.” Cleo also claimed to the FCC that it “has been providing high-speed Wireless Internet for 500 Customers”.

Dozens of nearly identical complaints

The FCC said it reviewed 41 complaints about Cleo, all of which “focused on the same type of allegations. According to the complaints, consumers searched for participating EBB programs through individual states’ Universal Service or EBB program websites, the FCC website. Provider list., or USAC’s [Universal Service Administrative Company] website and click the link to Cleo’s website. The complaint alleges that Cleo electronically accepted payment from these consumers for EBB Program discounted broadband service or connected devices, failed to deliver the ordered product or provided the requested service, and then failed to provide a refund. “

The FCC interviewed eight consumers who filed complaints, who live in Alabama, Arizona, Colorado, Illinois, Massachusetts, New York, Washington and Wisconsin.

An Illinois woman ordered a laptop from Cleo for $50 using the Venmo payment service. When the woman contacted Cleo to report that she never received the laptop, she got no response, the FCC said. She then “attempted to contact Cleo through social media (Facebook) and phone, but Cleo did not respond and blocked her on Facebook and phone,” the FCC said.

The FCC said a New York woman “ordered an EBB Program discounted tablet, laptop, ‘Wi-Fi box’ and hotspot service from Cleo’s website on July 13, 2021, and made an order via PayPal on the website A payment of $108.94 was arranged.” The consumer “told bureau staff that she emailed Cleo when she did not receive the equipment she ordered, and that Cleo staff were rude to her and told her They don’t have to serve her.'” She said someone at Cleo told her to “read the fine print.” She exchanged several emails with Cleo until it finally stopped responding. “

Other complainants also said that Cleo stopped responding to messages seeking information on devices they never received. Some consumers were able to cancel payments made via credit card or PayPal.

“The eight consumers the bureau interviewed and others who filed complaints with the FCC’s Consumer Complaint Center said Cleo did not provide the services or equipment they ordered under the EBB program, and the company refused to refund them. Complained that Cleo claimed to sue them when they asked for a refund,” the FCC said.

Improper terms of service prohibit refunds

The terms of service cited by Cleo in denying refunds say the company “does not and will never imply or agree to refunds, credits or any other refund services and payments to you.”

“Cleo Communications offers prepaid services. All services are sold as follows [sic] And there is no warranty. According to the FCC, Cleo Communications does not represent any warranty under any circumstances and does not provide any kind of refund for services provided. Contract at any time and subject to further legal action, up to but not limited to small claims court action, for the amount in dispute, any and all legal fees, court costs, attorney fees, filing fees, interest 9.9%, and 300.00 Contract breach fee in USD. “

Rude response: “You will be taken to court”

The FCC filing details instances in which Cleo responded to customers seeking refunds by threatening to sue or pursue allegations of harassment:

For example, on August 2, 2021, when a customer emailed a refund requesting a refund, Cleo replied: “[y]We want to hide behind PayPal instead of contacting us. We will not refund you. We will not allow you to use the benefits we claim. You will be taken to court. Cleo cares. “

On August 10, 2021, when another customer requested a refund, Cleo responded: “Refund denied. Please refer to the Terms of Service, which outlines your rights and the obligations and rights we will impose. Your EBB has been claimed. You will not use our credit anywhere else, you will be invoiced and collected. Cleo Collections. Cleo continued in a later email with the customer, “[n]Read next time before you order. Because we will no longer communicate now. Any further emails will lead to harassment charges in Ohio. Cleo Law. “

On August 12, 2021, Cleo told another client, “[w]We didn’t ignore you, and we didn’t charge you.You have requested a refund but have not been given a refund and have been told that someone will decide [sic] One will be issued or not. See -kyty.xyz/terms.html. is sent to the FCC.File with your claim status that you are and have not been ignored [sic]. Cleo Legal Affairs.


This story originally appeared in Ars Technica.

Tags: AidcrimeFCCfraudgovernmentISPLowIncomePeopleScamSeekingTargetedtechnologytelecommunications
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