TODAY ONLY - 4x your impact with a Giving Tuesday match! MATCH MY GIFT

DoJ wants $16 million in subsidies back from AT&T

Marc Sanchez Mar 23, 2012

You know that Nigerian prince who’s been asking you for money for so many years it’s not even funny? Turns out he’s hearing impaired and likes to make phone calls too. Yesterday the Department of Justice filed a lawsuit against AT&T for helping him out. Confused? Bear with me for a second, and I’ll explain. IP relay is a free telephone service, where someone who is hearing impaired types in text to make a call. The text is read aloud by a phone company employee to the recipient, and the reply is then typed and sent back to the caller. Low tech? Yes, but it works. Phone companies, like AT&T, are subsidized by the Federal Government at $1.30 to provide the service.

Hucksters, many based in Nigeria, figured out that they could use IP relay to make a quick buck.

The Wall Street Journal explains a typical scam as outlined in the DoJ’s suit:

The complaint used an example of a scammer pretending to be a foreign buyer, who placed a  large order with a stolen credit card. Typing text read aloud by the operator, the scammer would then ask the merchant to wire money for transporting the goods.
The advantage of using the IP Relay system is that it is anonymous, the Justice Department said in the complaint. The caller can’t be visually identified, and FCC rules say operators can’t disclose the contents of the conversation.

The DoJ claims that AT&T knew about the problem, especially about calls originating from specific parts of Nigeria.

Bloomberg reports:

As many as 95 percent of the calls in AT&T’s hearing- impaired program were made by people outside the U.S. attempting to defraud merchants through the use of stolen credit cards, counterfeit checks and money orders, according to the complaint.

As a nonprofit news organization, our future depends on listeners like you who believe in the power of public service journalism.

Your investment in Marketplace helps us remain paywall-free and ensures everyone has access to trustworthy, unbiased news and information, regardless of their ability to pay.

Donate today — in any amount — to become a Marketplace Investor. Now more than ever, your commitment makes a difference.