Man set up fake ISP to scam low-income people seeking gov’t discounts, FCC says

Enlarge (credit: Getty Images | Jeffrey Coolidge)

An Ohio man created a fake broadband provider in order to scam low-income consumers who thought they were getting government-funded discounts on Internet service and devices, according to the Federal Communications Commission. In a Notice of Apparent Liability for Forfeiture released Friday, the FCC proposed a fine of $220,210 against alleged scammer Kyle Traxler.

Traxler created an entity called Cleo Communications that sought authorization to be a provider in the FCC's Emergency Broadband Benefit (EBB) program, which provided $50 monthly discounts on Internet service and discounts for devices. "Cleo apparently existed for the sole purpose of taking financial advantage of customers under the disguise of being a legitimate EBB Program provider," the FCC notice said. "Cleo Communications has had no business activity outside of the EBB Program and no other business purpose."

The FCC began investigating after receiving complaints from consumers in at least eight states who ordered devices and/or "hotspot service." In some cases, consumers said that Cleo threatened to sue them after they asked for refunds for items and service they didn't receive.