In January 2026, the Federal Communications Commission's Office of Inspector General (OIG) found that the Lifeline program—which provides small subsidies for telecommunications services provided to low-income households—has been systematically exploited through fraudulent enrollments of deceased individuals and duplicate subscriber claims. The OIG concluded the problem is concentrated in three "opt-out" states (California, Texas, and Oregon), which the FCC permitted to run their own subscriber eligibility verification systems instead of using the Universal Service Administrative Company's (USAC) federal National Verifier and National Lifeline Accountability Database (NLAD).¹ Because these state systems bypass USAC's death checks at the enrollment stage,² they created a significant gap that bad actors—primarily providers and their sales agents—have exploited.

The core vulnerability is structural: the opt-out exemption allowed California, Texas, and Oregon to bypass federal safeguards that successfully blocked over 1.3 million fraudulent enrollment attempts in other states between 2018 and 2024. The FCC has already revoked California's opt-out status, and the OIG's recommendations largely aim to close the remaining structural gaps before similar fraud scales further.

Providers and their agents—not random external fraudsters, and, importantly, not Lifeline recipients—are identified as the primary perpetrators.

In launching a new rulemaking proceeding (NPRM) for the Lifeline program, FCC Chairman Brendan Carr noted the OIG's work "concerning patterns of fraud that merit the Commission’s attention." In the proceeding, the FCC proposes to address some of the OIG findings and recommendations. Here is a look at the recommendations and how the FCC proposes to address them.

Impact on the Lifeline Program

To determine the prevalence of deceased individuals in Lifeline from opt-out states, the OIG engaged in a collaborative data-matching initiative with the U.S. Department of the Treasury’s (Treasury) Do Not Pay program. The investigation uncovered the following improper payments and fraud connected with Lifeline providers in the opt-out states:

• Between December 2020 and September 2025, telecommunications providers claimed nearly $5 million in subsidies on behalf of approximately 116,808 deceased opt-out state subscribers.
• At least 16,774 of those subscribers were enrolled after they had already died—a clear indicator of intentional fraud. Another 22,588 may also have been deceased at enrollment, but this cannot be confirmed because opt-out states did not report enrollment dates to USAC.
• Providers claimed support for deceased subscribers for an average of 4.4 months after death before being caught.
• In September 2025 alone, over 11,000 deceased subscribers slipped through USAC's monthly reimbursement death check, costing roughly $100,000 in a single month.

The OIG also found a recurring problem of multiple, duplicative subscriber enrollments and claims among opt-out state subscribers, a significant program integrity risk created by the parallel Lifeline enrollment process for opt-out and NLAD states.

• The OIG identified over 270,000 instances where the same subscriber was claimed by providers more than once in a single month, with providers collecting nearly $5.5 million in connection with these duplicate claims.
• Duplicates occurred both across multiple opt-out states and between opt-out states and NLAD states simultaneously.
• The Lifeline rule prohibiting more than one benefit per household (47 C.F.R. § 54.409(c)) was routinely violated.

OIG Recommendations

The OIG directs its recommendations to three audiences: Lifeline providers, USAC and the FCC, and the states.

For Lifeline Providers

1. Implement robust Lifeline enrollment and claims policies and procedures: The NPRM addresses this indirectly through its proposals on provider compliance plans, codifying internal duplicate-check requirements, and usage tracking. However, the NPRM doesn't mandate a specific compliance program structure; instead, it seeks comment on what compliance obligations should look like.
2. Exercise better oversight of employees, agents, contractors, and representatives to ensure they don't provide false information to NLAD, the National Verifier, or the Representative Accountability Database (RAD): This maps directly to the NPRM's "Promoting Principled Service Provider Conduct" section and its proposals around RAD registration enforcement and provider compliance plans. The NPRM also seeks comment on whether additional enforcement mechanisms are needed.
3. Promptly disclose allegations or evidence of fraud, waste, and abuse to the FCC and the OIG:³ This is not addressed in the NPRM. 

For USAC and the FCC

1. Use OIG findings to recover funds paid to providers for deceased subscribers, and reverify/de-enroll any deceased subscribers. This is an enforcement and administrative action, not a rulemaking matter, and would need to be pursued through the FCC's Enforcement Bureau and USAC's program integrity operations directly.
2. Require Lifeline providers to report consumer usage data when seeking monthly reimbursements. The FCC is currently proposing to require usage tracking and non-usage de-enrollment for all Lifeline service plans, regardless of whether a monthly fee is assessed and collected.
3. Require opt-out states to share all subscriber enrollment and transfer information with NLAD/National Verifier to ensure duplicate enrollment detection. The NPRM includes a dedicated section on opt-out state reforms and seeks comment on whether to continue permitting opt-out states to use their own verification processes at all. California's opt-out status was already revoked in 2025, and the NPRM signals the FCC is considering ending the opt-out framework for the remaining states (Texas and Oregon).
4. Implement internal controls to prevent duplicate subscriber claims. The NPRM proposes codifying the requirement that ETCs search their own internal records to confirm they are not already serving someone in an applicant's household, and includes a section specifically on preventing duplicative support.
5. Enforce rules that require Lifeline providers to timely and accurately register all enrollment representatives in RAD and report their enrollment-related activity. The FCC is considering changes to promote more principled Lifeline provider conduct, including enforcement mechanisms to ensure providers comply with all rules.
6. Require opt-out state sales agent registration in RAD and enrollment activity reporting for all subscribers for whom providers seek federal support. The NPRM engages with RAD registration enforcement broadly under the "Promoting Principled Service Provider Conduct" section, and the FCC has flagged this as an open OIG recommendation.
7. Leverage failed application information to identify providers and agents attempting to enroll deceased individuals, and take remedial action, including suspending or terminating database access and referring to FCC Enforcement and OIG. This is primarily an operational directive to USAC and an enforcement matter for the FCC's Enforcement Bureau. The NPRM does not appear to take this up directly; it proposes provider compliance plans and enforcement mechanisms through which such action could occur.
8. Enforce agent registration requirements on NLAD states. This maps directly to the NPRM's proposals around RAD enforcement and principled provider conduct. The NPRM seeks comment on enforcement mechanisms for provider compliance with all program rules, including agent registration obligations.
9. Require households to independently verify their new Lifeline enrollments and transfer requests through an affirmative response to a text, e-mail or other outreach using the contact information included in the subscriber application. In the FCC's current Lifeline proceeding, the Commission seeks comment on requiring secondary verification of a consumer's consent to enroll in Lifeline or transfer to a new eligible telecommunications carrier.
10. Require collection of full Social Security Numbers as part of the Lifeline application process. This is one of the NPRM's headline proposals—it specifically proposes collecting full nine-digit SSNs from all applicants, citing both the OIG's longstanding recommendation (first made in 2016 and renewed in January 2026) and Treasury's emphasis that full SSNs make identity verification and matching more comprehensive.

For Opt-Out States, the FCC, and USAC Jointly

1. Evaluate new sources of identity and eligibility verification information, including Treasury's Do Not Pay program, to ensure program administrators have access to the most comprehensive data available to combat program integrity threats. The NPRM's proposals around full SSN collection and use of the SAVE program for immigration status verification reflect movement toward more comprehensive identity verification data sources. However, the NPRM does not explicitly propose integrating Treasury's Do Not Pay database into the enrollment or reimbursement process—which was the specific tool the OIG used to uncover improper payments.
2. Remain alert to new and more comprehensive technologies, including continuous monitoring, and evolving sources of information to use in program administration. This forward-looking, aspirational directive rather than a concrete regulatory requirement. Unsurprisingly, the NPRM does not translate it into a specific proposed rule. It is the kind of recommendation that would be implemented operationally by USAC over time rather than through rulemaking.

Separately, the OIG has directed two operational recommendations to USAC that fall outside of the NPRM's scope. USAC could act on them independently. 

National Verifier Applications Should be Closed Once a Fabricated or Fraudulent Proof is Confirmed.

Currently, USAC allows applicants to amend their National Verifier applications an unlimited number of times. This practice is also applied to applicants who submit fabricated eligibility or identity documents. Applications containing fabricated proofs should be closed as the consumer, or as many OIG investigations show, the provider’s enrollment representative, already demonstrated an intent to defraud the program by submitting forged documents. Qualified low-income households have no need to fabricate proof for approval, OIG said, and fraudsters should not be given a second chance to defraud the program. 

The NPRM addresses verification processes but does not appear to take up this specific operational rule.

USAC Should Utilize Optical Character Recognition (OCR) Software to Identify Other Examples of Fraudulent Documents. 

USAC relies solely on Business Process Outsourcing (BPO) reviewers to spot and escalate suspicious documents for further scrutiny, even though USAC’s own quality assurance reporting indicates reviewers miss suspicious documents. OIG investigations and USAC’s enrollment representative lockout log show strong evidence that fabricated documents are routinely reused to support multiple fraudulent applications. Incorporating the use of OCR technology could mitigate the risks of relying solely on human reviewers to detect fabricated documents. USAC recently contracted with a vendor to acquire and leverage OCR and other fraud-detection tools for manual review. 

Is the FCC Proposing to Improve Lifeline?

The NPRM takes up several of the OIG's recommendations, but also proposes changes that go beyond what the OIG identified as the source of the problem.

As noted by FCC Commissioner Anna Gomez, the OIG’s findings regarding Lifeline integrity focused overwhelmingly on administrative deficiencies and provider and agent misconduct, not subscriber eligibility. The OIG’s findings specifically focused on incidences of fraud in California, Texas, and Oregon, the three states that opted out of using NLAD or the National Verifier.

The OIG’s recommendations for addressing fraud are narrowly tailored to directly address two key issues: enrollment of deceased individuals and duplicate enrollment. The OIG did not recommend raising eligibility thresholds or imposing additional burdens on consumers.  

"Punishing eligible families fundamentally misdiagnoses the problem and risks undermining a program designed to help low-income households stay connected," said Commissioner Gomez.

Notes

1. As the OIG has previously found, the FCC's implementation of the National Lifeline Accountability Database (NLAD) substantially reduced the number of duplicate enrollments in its programs, and the National Verifier significantly reduced eligibility fraud. Moreover, the FCC’s transition to reimbursing program providers’ claims based on the number of subscribers the provider actually enrolled in NLAD, not solely on self-reported information furnished by the providers, enhanced program integrity and credibility.
2. In response to OIG recommendations made in 2017, the FCC and USAC, the Lifeline program administrator, began performing a death check during the Lifeline enrollment process. However, OIG investigations continued to identify deceased enrollees in the Lifeline program, the $3.2 billion Emergency Broadband Benefits Program (EBB) instituted during the Pandemic, and the $14.2 billion Affordable Connectivity Program (ACP), which ended in 2024. 
3. FCC universal service program partners frequently are among the first to learn of threats to program integrity, including fraud, but rarely proactively share such information with the agency or the OIG. Moreover, FCC rules do not uniformly require subsidy program partners to disclose or report fraud to the Commission and OIG.

The Benton Institute for Broadband & Society is a non-profit organization dedicated to ensuring that all people in the U.S. have access to competitive, High-Performance Broadband regardless of where they live or who they are. We believe communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities.

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