Telecom CEO sentenced to prison, must pay hefty restitution for ‘Obama phone’ fraud

Since President Donald Trump took office, his administration has been working to expose waste and fraud within the government, scenarios that often include outside vendors that take advantage of lax oversight of federal programs.

As Fox Business reports, the perpetrator of such misconduct, the owner of a Florida-based telecommunications firm, has been sentenced to five years in prison and will be required to pay millions in restitution, having pleaded guilty to defrauding the federal government through a program providing so-called “Obama phones” to low-income Americans. 

Asad, Q Link face justice in fraud case

According to the outlet, Q Link Wireless LLC and Issa Asad, its CEO, pleaded guilty in 2024 to a conspiracy to engage in wire fraud and to steal from the federal Lifeline program.

The initiative, which first launched in 1985 but was expanded during the presidency of Barack Obama, provides government-subsidized cellular phone services for those in need.

A press release issued by the Justice Department on Monday explained that the company and Asad have agreed to resolve criminal charges and civil False Claims Act allegations by paying $110,637,057.

Eligible carriers such as Q Link are able to receive monthly payments from the federal government for providing discounted phone service to eligible participants, though they are required to certify compliance with program rules and must cease submitting claims for consumers who no longer meet the criteria for enrollment.

Q Link and Asad, however, stood accused of receiving federal payments to which they were not entitled by submitting false and fraudulent claims on behalf of customers who did not meet eligibility rules, and ultimately, Q Link received more than $38 million in improper payments over the time frame at issue, and under the terms of the aforementioned settlement, criminal restitution payments will be credited to the amount due pursuant to the civil settlement.

DOJ weighs in

Assistant Attorney General Brett A. Shumate offered comment on the outcome, saying, “The Justice Department will take action where companies and individuals knowingly violate the rules of federal programs and claim federal funds to which they are not entitled.”

He continued, “Today’s settlement demonstrates our continuing commitment to preventing fraud against important FCC subsidy programs like Lifeline.”

FCC chair Brendan Carr added his thoughts as well, saying, “The FCC takes very seriously any instance of misuse of public funds and misrepresentation. Protecting taxpayer dollars from waste, fraud and abuse is central to our work.”

He added, “I thank our partners at the Justice Department and the tireless teams at the FCC – including the Office of General Counsel and Office of Inspector General – for their relentless pursuit of this matter.”

U.S. Attorney Hayden O’Byrne noted, “This settlement addresses the integrity of the Lifeline Program, an important program that helps low-income Americans connect to people and information, a modern-day necessity.”

Additional penalties levied

As Fox Business noted, Asad separately pleaded guilty to laundering money from the federal Paycheck Protection Program COVID-19 loan program and paid over $1.7 million in restitution for that misconduct.

In addition to the staggering financial sanctions, Asad, 51, received a sentence of five years in prison, offering at least some measure of justice for what was an egregious pattern of fraud against the government and the taxpayers who fund it.

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