New York officials reported they have secured $615,000 from three companies that supplied millions of fake public comments to influence a 2017 proceeding by the Federal Communications Commission (FCC) to repeal net neutrality rules.
New York Attorney General Letitia James identified the three companies as LCX, Lead ID, and Ifficient. She said an investigation by her office found that the fake comments used the identities of millions of consumers, including thousands of New Yorkers, without their knowledge or consent.
Collectively, the three companies have agreed to pay $615,000 in penalties and disgorgement. This is the second series of agreements secured by the office of the attorney general (OAG) with companies that supplied fake comments to the FCC to create the false impression of popular support for repeal of net neutrality rules put in place in 2015 rules.
“Public comment opportunities are a chance for Americans to give their input on important government policies, and these companies abused that for their own selfish purposes,” said James. “No one should have their identity co-opted by manipulative companies and used to falsely promote a private agenda.”
Net neutrality prohibits internet service providers (ISPs) from blocking, slowing down, or charging companies to prioritize certain content on the internet. Net neutrality rules supporters maintain that they ensure a free and open internet. Broadband groups contend the rules discourage investment.
The FCC under former President Barack Obama adopted net neutrality rules in 2015 that barred ISPs from blocking or slowing internet content or offering paid “fast lanes.” In 2017, the FCC under former President Donald Trump overturned those rules.
According to a report by the OAG, the nation’s largest broadband companies funded a secret campaign to generate millions of comments to the FCC in 2017. These comments provided “cover” for the FCC to repeal net neutrality rules, according to the OAG.
The agreements are the result of an investigation that OAG said uncovered “widespread fraud and abusive practices” surrounding efforts to sway the FCC in the agency’s 2017 net neutrality rulemaking proceeding.
According to the report, to help generate these comments, the broadband industry engaged commercial lead generators that used advertisements and prizes, like gift cards and sweepstakes entries, to encourage consumers to join the campaign. However, nearly every lead generator that was hired to enroll consumers in the campaign instead simply fabricated consumers’ responses, according to the OAG. As a result, more than 8.5 million fake comments that impersonated real people were submitted to the FCC, and more than half a million fake letters were sent to Congress.
Two of the companies, LCX and Lead ID, were each engaged to enroll consumers in the campaign. Instead, each independently fabricated responses for 1.5 million consumers. The third company, Ifficient, acted as an intermediary, engaging other lead generators to enroll consumers in the campaign. Ifficient supplied its client with more than 840,000 fake responses it had received from the lead generators it had hired.
The OAG’s investigation also revealed that the fraud perpetrated by the various lead generators in the net neutrality campaign infected other government proceedings as well. Several of the lead generation firms involved in the broadband industry’s net neutrality comment campaigns had also worked on other campaigns to influence regulatory agencies and public officials.
In nearly all of these advocacy campaigns, the lead generation firms engaged in fraud, according to the OAG. As a result, more than 1 million fake comments were generated for other rulemaking proceedings, and more than 3.5 million fake digital signatures for letters and petitions were generated for federal and state legislators and government officials across the nation.
LCX and Lead ID were responsible for many of these fake comments, letters, and petition signatures. Across four advocacy campaigns in 2017 and 2018, LCX fabricated consumer responses used in approximately 900,000 public comments submitted to the Environmental Protection Agency (EPA) and the Bureau of Ocean Energy Management (BOEM) at the U.S. Department of the Interior. Similarly, in advocacy campaigns between 2017 and 2019, Lead ID fabricated more than half a million consumer responses. These campaigns targeted a variety of government agencies and officials at the federal and state levels.
The agreements require the three companies and their principals to pay penalties and disgorgement. LCX and its principals will pay $400,000 in penalties and disgorgement to New York and $100,000 to the San Diego District Attorney’s Office. Lead ID and its principal will pay $30,000 in penalties and disgorgement to New York. Ifficient will pay $63,750 in penalties and disgorgement to New York, and $21,250 to Colorado.
In May 2021 James announced agreements with three other lead generators that were responsible for millions of the fake comments submitted in the net neutrality proceeding: Fluent, Inc., responsible for approximately 4.8 million fraudulent comments; Opt-Intelligence, Inc., responsible for more than 250,000 fraudulent comments; and React2Media, Inc., responsible for approximately 329,000 comments in the net neutrality proceeding. Fluent and React2Media were also responsible, collectively, for millions of fake comments and messages submitted in dozens of other advocacy campaigns. The agreements with the OAG required the companies to adopt comprehensive reforms in future advocacy campaigns and pay more than $4.4 million in penalties and disgorgement.
Topics New York
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