James O’Keefe’s conservative activist group Project Veritas exposed two corporate distributors handing out free cell phones to people, despite awareness of their intention to sell the devices for heroine and Louis Vuitton handbags.
These devices, coined “Obama phones” last September as part of an Ohio presidential campaign event, are a project of the Federal Communications Commission called “Lifeline,” which provides free mobile phones to Americans who meet low-income requirements.
Project Veritas sent undercover actors to a Stand-Up Wireless location in Philadelphia and a Terracom giveaway in Minneapolis.
The first undercover actor stated his purpose was to sell the phone he was being given to buy drugs.
“Once you guys give me this phone, it’s my phone? I can, like, sell it and stuff?” the actor asked the Philadelphia employee.
“Whatever you want to do with it,” the worker replied.
“So I’m [going to] get some money for heroine,” he informed the employee.
“Hey, I don’t judge,” the man shrugged as he willingly provided the undercover actor the free phone.
Later footage showed a woman telling a Minneapolis employee, “There is a really awesome pair of shoes at the store that I want.”
The workers at the two companies featured in the Project Veritas footage willingly gave phones to applicants after being told directly they would not be using the phones according to program guidelines, but rather would immediately sell them.
The program spent $2.19 billion in 2012. The cost is footed by Americans who pay their own phone bills. A portion of the Federal Universal Service Charge, which appears on every land line and mobile bill in all 50 states and the District of Colombia, subsidizes the program.
Corporate phone companies are the ones profiting, such as industry leader TracFone, which has received more than $1.5 billion, including $440 million in 2012 alone, to provide phones to 3.9 million recipients.
The Lifeline program was begun under President Ronald Reagan and expanded under President George W. Bush, but is widely credited to President Barack Obama.
Members of Congress including Louisiana GOP Sen. David Vitter and Arkansas Rep. Tim Griffin are fighting to end the mobile component of the program, which was added in 2008 and has since increased costs related to non-land line phones twelve-fold, a Vitter spokesman told MailOnline, which first reported on the video.
The Lifeline program is “an example of government politicians abusing the power we have loaned them,” O’Keefe told MailOnline. “The program utilizes corporate subsidies that enrich the wealthy and hurt the needy and are prime picking for abuse.”