Sprint Communications has agreed to pay $15.5 million to the federal government for defrauding federal law enforcement agencies by overcharging to recoup the cost of executing court-ordered surveillance such as wiretaps.
A joint investigation by the U.S. Department of Justice Office of Inspector General (OIG) and the U.S. Attorney's Office, found that Sprint was hiding the costs of some of its systems upgrades in billing statements sent to the government between 2007 to 2010, according to a release. The 1994 Communications Assistance for Law Enforcement Act (CALEA) required telecommunications companies to upgrade their services, equipment, and facilities to have built-in surveillance capabilities.
Companies are allowed to charge for the "reasonable expenses” incurred to meeting government intercept requests though a 2006 Federal Communications Commission (FCC) ruling prevents them from passing the costs of upgrading their systems on to law enforcement agencies.
