The FCC has proposed a forfeiture of $220,210 against Kyle Traxler and Cleo Communications (Cleo) for its apparent violations of the federal wire fraud statute and FCC rules arising out of its participation in the Emergency Broadband Benefit Program (Program). Following an investigation by the FCC’s Enforcement Bureau, the Commission concluded that Cleo had apparently willfully and repeatedly committed wire fraud by misrepresenting its authorization to participate in the Program and using such authorization to defraud consumers via interstate wires.
Numerous complaints against Cleo were filed with the FCC, the Universal Service Administrative Company, and the Better Business Bureau for its alleged conduct. The FCC determined that Cleo never filed or received disbursements from the Program even though it had promised consumers that they would receive EBB Program-discounted broadband devices and services. Cleo never delivered such devices and services. The Commission argues that this conduct severely harmed low-income consumers who entered into online transactions for the discounted services and devices that they ultimately did not receive. The FCC has thus proposed the statutory maximum they it impose as a forfeiture penalty against Cleo.