Telecom CEO, FL company plead guilty to $100m in Lifeline fraud

Q Link Wireless of Dania Beach, Florida and its CEO, Issa Asad, have both pleaded guilty to defrauding the federal Lifeline program that provides discounted connectivity services to low-income people, in a scheme that stole more than $100 million from the program over about eight years.

“The Lifeline program helps low-income families stay connected via phone and internet to their school, work, or loved ones. Deceptive schemes that exploit at-risk communities and manipulate federal support for phone and broadband services should not go unpunished,” said Federal Communications Commission Chairwoman Jessica Rosenworcel. She thanked the investigators at the FCC and the Department of Justice who pursued the case, and added: “As this investigation escalated, the FCC proactively took extraordinary steps to protect the current Lifeline fund, while preventing any service disruption, including withholding tens of millions in Lifeline payments from Q Link to prevent disbursements that would be in violation of program rules. The FCC will continue to take steps to assist our law enforcement agencies to account for misuse of taxpayer dollars and protect the integrity and success of FCC programs.”

Asad, 51, of Southwest Ranches, FL, also pleaded guilty to money laundering in another scheme to defraud the Paycheck Protection Program, a federal effort that was aimed at helping individuals and businesses stay afloat during the height of the Covid-19 pandemic.

According to the FCC and court documents, Q Link was directed by Asad as early as 2012 to submit millions of dollars in false claims to the Lifeline program for reimbursement, including false information about nonexistent Lifeline customers, as well as filing false information about the company’s compliance with Lifeline program rules. The cheating continued through at least 2021.

Asad and Q Link were charged with conspiring to commit wire fraud and steal government money and defraud the United States. The guilty pleas were accepted by U.S. Circuit Court Judge Rodolfo A. Ruiz II and a sentencing hearing will be held on January 15. According to the FCC, Asad’s plea agreement recommends that he serve the statutory maximum of five years in prison for the Lifeline-related fraud; the statutory maximum on the money-laundering charge is 10 years of imprisonment.

Asad and Q Link also agreed to pay nearly $110 million in restitution to the FCC by their sentencing hearings, and Asad agreed to pay another $1.7 million to the U.S. Small Business Association in restitution for the PPP fraud. A forfeiture judgement of at least $17.48 million was also placed against him.

“Issa Asad and his company, Q Link Wireless, purposefully defrauded two critical federal programs helping individuals and businesses suffering financial hardship, unlawfully taking hundreds of millions of dollars for their own use and profit, while obstructing the United States’ ability to help people who, unlike the Defendants, needed it,” said U.S. Attorney Markenzy Lapointe for the Southern District of Florida in a statement. “The plea agreements in this case impose extraordinary and unprecedented financial penalties, as they should.”

Lapointe added: “That Asad cheated two different programs meant to help people in need makes this prosecution even more imperative.”

“Brazen fraud schemes that prey on vulnerable populations and target federal telephone and broadband subsidy programs, designed to ensure that low-income consumers can access critical telecommunications services, demand the most serious punishments like the ones included in today’s plea agreement,” said FCC Inspector General Fara Damelin. “This result was made possible by dedicated investigators and our investment in a robust data analytics capability. The FCC OIG is committed to using all of our resources, and working with our outstanding law enforcement partners, to investigate and hold accountable those who abuse the FCC’s public subsidy programs and to protect all those who rely on them to stay connected.”

“Stealing over $100 million for programs meant to support people in times of need is a crime against the entire nation.” said Juan A. Vargas, who is Inspector in Charge of the U.S. Postal Inspection Service (USPIS)’s Miami Division. “Asad and Q Link’s guilty pleas send a clear message: those who cheat the government for personal gain will be held accountable.”