On Friday, Charles A. “Chuck” Jones, 51, a Kentucky businessman, pleaded guilty to a decade-long scheme and conspiracy to defraud the Federal Communications Commission’s (FCC) E-Rate Program.
The E-Rate Program is an FCC program that provides money to needy schools, often in rural areas of America, for internet access and telecommunications services. The program has specific rules that forbid service providers to the schools, such as Jones, from paying kickbacks to school officials and consultants. The E-Rate Program also requires participating service providers to charge participating schools at least a 10% co-pay.
In a press release by the Western District of Tennessee U.S. Attorney’s Office, Jones paid kickbacks to an E-Rate consultant working with the Missouri and Tennessee schools involved in this case for approximately 10 years. During this 10-year conspiracy, Jones, one of his employees, and the school E-Rate consultant, made false statements and submitted fabricated documents to the E-Rate Program regarding the required co-pays and the program’s fair and open bidding process. In essence, Jones and his co-conspirators used the victim schools as vehicles to fraudulently obtain money from the E-Rate Program for Jones.
The loss to the E-Rate Program was approximately $6.9 million dollars, the press release notes.
“The FBI is committed to investigating allegations of fraud related to federally funded programs, especially when those egregious schemes impact programs designed to help rural schools in need,” Special Agent in Charge Douglas M. Korneski of the Federal Bureau of Investigation’s Memphis Field Office said in a statement. “This guilty plea is the result of the focus and coordinated effort of the dedicated investigators and prosecutors involved.”
Jones has pleaded guilty to conspiracy to commit wire fraud, which carries a maximum possible term of imprisonment of 20 years. He is scheduled to be sentenced on June 1, 2022 before United States District Judge Mark S. Norris in Memphis, according to the press release.
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Kaitlin Housler is a reporter at The Tennessee Star and The Star News Network.
A great news story would be how long his sentence is for that 6.9 million dollars and how long the other co-conspirators were sentenced for. Our Government provides incentives to commit fraud. Especially when it comes to social programs. Often, cases of blatant fraud, waste and abuse go without any repercussion at all, they simply increase the spending and hire more employees to create more opportunity to commit fraud. The hundreds of billions of dollars that flow in and out of tax exempt non profits are a perfect example of acceptable fraud based on incentive provided by all levels of government.
Randy – Very well stated. Thank you.