Sprint to pay $15.5 million for bilking feds on wiretaps

Sprint to pay $15.5 million for bilking feds on wiretaps
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Sprint has agreed to pay $15.5 million over Justice Department allegations that it routinely overcharged the government for millions of dollars while conducting wiretaps.

The government routinely reimburses major telecommunications companies like Sprint or AT&T for “reasonable expenses” whenever they are ordered to set up a wiretap.

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But according to the Obama administration’s 2014 lawsuit, Sprint inflated bills by more than 50 percent between 2007 and 2010, leading to $21 million in extra profits when it tapped phones for the FBI, Drug Enforcement Administration, U.S. Marshals Service and others. 

In its suit, the Obama administration claimed that Sprint tried to get payment for things not covered under federal law, including “the costs of financing modifications to equipment facilities and services installed to comply with” a wiretapping law.

That’s a violation of 2006 guidelines form the Federal Communications Commission, the government claimed.

Sprint did not admit wrongdoing in the settlement.

The $15.5 million settlement is much less than the government had requested. In its initial suit, it had demanded that Sprint pay back triple the damages, as called for under the False Claims Act.