Florida CEO Gets 5 Years in Prison, $128M Fine In ‘Obama Phone’ Scam
The owner of a Florida telecommunications company was sentenced to five years in jail after pleading guilty to stealing from the government program known informally as “Obama phone,” which provides cheap phone services to low-income consumers.
Q Link Wireless LLC and its 51-year-old CEO, Issa Asad, pled guilty last year to conspiring to conduct wire fraud and steal federal funds from the Lifeline program, the Department of Justice said.
The program, which began in 1985 and was expanded under Obama, offers subsidized mobile service to the underprivileged. It was extensively attacked during the 2012 election, when a viral video surfaced showing a lady in Cleveland alleging she and her companions were handed “Obama phones.”
Fox Business noted that some telecommunication providers with Lifeline contracts welcomed the moniker, but the government did not.
Asad was sentenced to five years in jail, and he and the corporation were required to pay financial penalties and reparations totaling more than $128 million, according to the agency.
Separately, Asad pled guilty to money laundering from a government credit scheme designed to help struggling companies amid the COVID-19 epidemic.
Under the plea agreements, Asad and Q Link agreed to pay the Federal Communications Commission about $110 million in reparations. Asad also paid a nearly $17.5 million criminal fine for profits derived from Q Link’s phone service plan.
The DOJ stated that this was one of the highest financial fines imposed by the FCC in its history.
Asad also paid the Small Business Administration about $1.7 million in restitution for laundering loan profits from the Paycheck Protection Program (PPP) during the outbreak.
According to the DOJ, he confessed to using PPP money for house building, a Land Rover payment, his personal American Express card, property taxes, jewelry, and university gifts.
Asad and Q Link acknowledged in court to defrauding the FCC’s Lifeline program.
Between 2012 and 2021, Asad and Q Link presented inaccurate information about their Lifeline clients and submitted many bogus claims for government reimbursement. They also admitted to keeping Lifeline monies that they were not entitled to and misled the FCC about the company’s compliance with program guidelines.
According to the Miami Herald, Asad has a criminal history and was charged with murder in 2014 after running over a groundskeeper at his business over a dispute over paying $65 for lawn services.
He eventually pleaded not guilty to misdemeanor culpable negligence and received one year of probation and a $225 fine.
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Issa Asad has been sentenced to prison for his role in the ‘Obama-phone’ scheme in which he defrauded government programs – costing $100 million#Obama
The 51-year-old CEO of Q Link Wireless, a Florida-based telecommunications company giving… pic.twitter.com/5TdHKVcHNB
“Issa Asad and his company, Q Link Wireless, deliberately scammed two vital government programs aimed at supporting people and companies in economic distress, wrongfully diverting hundreds of millions of dollars for their personal benefit and gain, all while impeding the government’s capacity to assist those who genuinely required the help,” stated U.S. Attorney Hayden P. O’ Byrne for the Southern District of Florida. “These outcomes underscore our resolve to make sure that those who mastermind corporate fraud schemes face personal consequences.”
“IRS Criminal Investigation special agents are specially equipped to follow the complex financial trail left by criminals, and we are dedicated to holding those accountable for crimes committed,” said Executive Special Agent in Charge Kareem Carterof the Internal Revenue Service – Criminal Investigation (IRS-CI), Washington, D.C. Field Office. “This was a brazen scheme of staggering proportions. Mr. Asad prioritized his own greed, stealing $100 million from taxpayers. Today’s sentencing sends a clear message that our Global Illicit Financial Team and our law enforcement partners remain vigilant and will vigorously pursue those who attempt to enrich themselves through fraudulent means.”
“Q Link and Asad stole funds from a key FCC program meant to serve low-income households,” said Inspector General Fara Damelin of the FCC, Office of Inspector General (FCC-OIG).
“This sentencing sends an important message that egregious criminal misconduct against FCC programs will not go unanswered. FCC OIG investigators and their law enforcement partners at DOJ, IRS, SIGPR, and USPIS, did an outstanding job on this investigation, and we thank FCC for its assistance. FCC OIG is dedicated to stopping waste, fraud, and abuse, and will continue to vigorously pursue investigations against wrongdoers who defraud FCC programs and victimize our most vulnerable populations,” Damelin added.
