LifeLine Compliance Policy

Purpose

The purpose of this Compliance Policy is to ensure TracFone is fully compliant with Lifeline Program Rules, and all terms of the Settlement Agreement, as defined herein.

Scope

The scope of this policy encompasses all Lifeline program offerings provided by TracFone Wireless, Inc.


Definitions

“Agent” (when capitalized) means any entity with whom TracFone enters into agreements to enroll customers in the Lifeline Program , as well as any subcontractors to such entities that are hired to enroll such customers.

“Commission” or “FCC” means the Federal Communications Commission.

“Compliance Hotline” shall mean the toll-free telephone number and an email address as described in Section 9 of the Compliance Agreement.

“Compliance Agreement” means the Lifeline Program Compliance Agreement between TracFone, Verizon, and the Commission, appended hereto.

“Compliance Manual” means the compliance manuals established pursuant to Section 7 of the Compliance Agreement and herein appended.

“Compliance Officer” means the individual appointed pursuant to Section 1 of the Compliance Agreement.

“Compliance Policy” means this policy.

“Compliance Report(s)” means the report(s) established pursuant to Section 12 of the Compliance Agreement.

“Compliance Training Program” means the training program established pursuant to Section 4 of the Compliance Agreement.

“Covered Personnel” (or, in the singular, “Covered Person”) means (1) all employees of TracFone and Verizon who perform, or supervise, oversee, or manage the performance of, duties that relate directly to TracFone’s responsibilities under the Lifeline Rules ; and (2) all individuals who have been or are anticipated to be assigned a Promo Code by TracFone to solicit or enroll customers in the Lifeline Program, as well as any supervisors of such individuals, whether or not employed by TracFone.

"Eligible Telecommunications Carrier" means a carrier designated as such under subpart C of Part 54 of Title 47 of the Code of Federal Regulations.

“Lifeline Claims System” is the online filing system maintained by USAC that service providers use to file claims in order to receive reimbursement for offering Lifeline-supported services to eligible consumers.

“Lifeline Fraud Loss and Control Team”means the team of individuals established under Section 8 of the Compliance Agreement.

Lifeline Program” or “Lifeline” means the support mechanism commonly referred to as the Lifeline Program or the Low Income Program of the Universal Service Fund, authorized by 47 U.S.C. § 254(c).

“Lifeline Program Rules” or “Lifeline Rules” means all rules, orders, or other items that have the effect of law adopted by the Commission (including under delegated authority) related to and implementing the Low Income Program of the Universal Service Fund, as provided in 47 U.S.C. §§ 214(e) and 254(c), including without limitation 47 C.F.R. §§ 54.1-54.11, 54.101, 54.201-54.207, 54.400-54.423, and Lifeline 6 CONFIDENTIAL and Link Up Reform and Modernization, WC Docket No. 11-42, CC Docket No. 96-45, WC Docket No. 03-109, Report and Order and Further Notice of Proposed Rulemaking, 27 FCC Rcd. 6656 (2012), Second Further Notice of Proposed Rulemaking, Order on Reconsideration, Second Report and Order, and Memorandum Opinion and Order, 30 FCC Rcd. 7818 (2015), Third Report and Order, Further Report and Order, and Order on Reconsideration, WC Docket Nos. 11-42, 09-197, 10-90 (rel. April 27, 2016), Fourth Report and Order, Order on Reconsideration, Memorandum Opinion and Order, Notice of Proposed Rulemaking, and Notice of Inquiry, 32 FCC Rcd. 10475 (2017), and Fifth Report and Order, Memorandum Opinion and Order and Order on Reconsideration, and Further Notice of Proposed Rulemaking, 34 FCC Rcd. 10886 (2019).

“Oversight Team” means the team of individuals established under Section 2 of the Compliance Agreement.

“Promo Code” means the individual code assigned through TracFone’s databases to any person employed by TracFone or by any Agent to solicit customers for Lifeline. A “Promo Code” has enough specificity to allow TracFone to identify the individual who solicited each customer enrolled into Lifeline.

“RAD” means the Representative Accountability Database as set forth in the Lifeline Program Rules.

“Reporting Period” means the period covered by each Compliance Report.

“Settlement” means the Settlement Agreement entered into by and among the United States of America (acting through the U.S. Department of Justice and on behalf of the FCC), the FCC, TracFone, and qui tam Relator Ferrell Gordon.

“TracFone” or “Company” means TracFone Wireless, Inc., a Delaware corporation with a principal place of business at 9700 Northwest 112th Avenue, Miami, Florida 33178 and operating as an Eligible Telecommunications Carrier (ETC), and any successors or assigns that may be offering Lifeline services.

“USAC” means the Universal Service Administrative Company.

“Verizon” means Verizon Communications Inc. and its subsidiaries, affiliates, successors, and assigns other than TracFone.


TracFone Lifeline Program

Background

TracFone is a leading provider of prepaid, no contract wireless communications services under its multiple brands designed to offer consumers a variety of flexible service options. TracFone provides Lifeline-supported service primarily through its SafeLink Wireless brand in 45 states, the District of Columbia, and Puerto Rico. 1 As a non-facilities based Commercial Mobile Radio Services (“CMRS”) provider, TracFone is required to submit a compliance plan to the Commission. 2 TracFone now updates its Lifeline Compliance Plan given that the Affordable Connectivity Program has ended.


Unrestricted Access to Basic and E911

Services and Certification of Such Access Pursuant to the 2012 Lifeline Reform Order, forbearance for non-facilities based ETCs is conditioned upon the ETC providing its Lifeline voice subscribers with 911 and E911 access, regardless of activation status and availability of minutes, and providing its Lifeline voice subscribers with E911- compliant handsets and replacing, at no additional charge to the subscriber, any non-compliant handsets of Lifeline-eligible subscribers who obtain Lifeline-supported voice services. 3 TracFone complies with all current 911 and E911 requirements when providing its voice service: TracFone provides its Lifeline voice customers with access to 911 and E911 services immediately upon activation of service, ensures that 911 and E911 access is available from TracFone handsets even if the account associated with the handset has no minutes remaining, and provides handsets that are E911-compliant.

Access to 911/E911. TracFone provides access to 911 and E911 services for all its customers, including its Lifeline customers. As described, TracFone uses Verizon, AT&T Wireless, and T-Mobile,

among others, as its underlying network providers. All of these providers route 911 calls and E911 information from TracFone’s customers in the same manner as 911 calls from their own retail customers. To the extent that any of TracFone’s underlying network providers offer wireless service and deliver 911 calls and E911 information in a given PSAP (“Public Safety Answering Point”) territory, this 911 capability will function the same for TracFone and its customers.

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1) The only states where TracFone does not offer a Lifeline-supported service are Alaska, Montana, Nebraska, Oregon and South Dakota.

2) Petition of TracFone Wireless, Inc. for Forbearance from 47 U.S.C. § 214(e)(1)(A) and 47 C.F.R. § 54.201(i), Order, 20 FCC Rcd. 15095 (2005) (“TracFone Forbearance Order”).

3) See 2012 Lifeline Reform Order ¶ 373.

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Access Regardless of Activity. TracFone also enables 911 and E911 emergency calling services for all properly activated handsets regardless of whether the account associated with the handset is active or suspended, and all 911 calls and E911 information initiated from any TracFone handset are transmitted even if the account associated with the handset has no remaining minutes. E911-Compliant Handsets. In the 2012 Lifeline Reform Order, the Commission adopted the requirement that the handsets offered with Lifeline-eligible services must be E911-compliant. 4 TracFone’s phones have passed a stringent certification process, which ensures that the handset models provided to customers meet all E911 requirements. As a result, any customer who qualifies for and elects Lifeline-supported service from TracFone, and who obtains a handset from TracFone, will have an E911-compliant handset.


Wi-Fi-Compliant Handsets

The 2016 Lifeline Modernization Order established the requirement that providers of Lifeline supported services offering both mobile broadband services and devices provide their customers with handsets that are Wi-Fi enabled. 5 The Commission further requires such providers to offer Lifeline customers the choice of devices that are equipped with hotspot functionality. 6 All handsets offered by TracFone are Wi-Fi enabled and TracFone will ensure that the appropriate percentage of devices it offers are capable of being used as hotspots as required by 47 C.F.R. § 54.408(f)(3).

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4) Id.

5) Lifeline and Link Up Reform and Modernization; Telecommunications Carriers Eligible for Universal Service Support; Connect America Fund, Third Report and Order, Further Report and Order, and Order on Reconsideration, 31 FCC Rcd. 3962 ¶¶ 366-367 (2016) (“2016 Lifeline Modernization Order”); 47 C.F.R. § 54.408(f)(1).

6) 47 C.F.R. § 54.408(f)(3).

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Compliance Agreement

On March 4, 2022, TracFone entered into a Compliance Agreement with the Department of Justice and the Federal Communications Commission. The Compliance Agreement imposes certain duties on TracFone which are described in further detail in this Policy. The Compliance Agreement is appended to this Policy.


Internal Controls and Procedures

Lifeline Enrollment Procedures

The following policies and procedures are to ensure that TracFone’s Lifeline subscribers are eligible to receive Lifeline services.


Overview

TracFone complies with the uniform eligibility criteria established in section 54.409 of the Commission’s rules, as amended by and through the 2016 Lifeline Modernization Order, as well as any additional certification and recertification requirements for Lifeline eligibility in states where TracFone is designated as an ETC. TracFone will not provide a consumer with an activated device that enables the use of Lifeline-supported service, nor will TracFone activate a Lifeline-supported service, unless and until it has confirmed that the consumer: (i) is a qualifying low-income consumer pursuant to section 54.409; (ii) has completed the eligibility determination and certification required by section 54.410 and sections 54.404 through 54.405; and (iii) has completed any other necessary enrollment steps. 7 listed in section 54.409 of the Commission’s rules. 8

All prospective subscribers are required to demonstrate eligibility based on either: (1) household income at or below one hundred-thirty five percent (135%) of the Federal Poverty Guidelines for a household of that size; or (2) the household’s participation in one of the federal assistance programs

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7) 47 C.F.R. §§ 54.409, 54.410, 54.404, 54.405.

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Accordingly, as set forth in the description of TracFone’s procedures below, prospective subscribers are enrolled only after their eligibility has been determined by the National Verifier for states that participate in the National Lifeline Accountability Database (“NLAD”). 9

In addition, through the certification requirements described below and the use of the NLAD or State Lifeline Administrator review as appropriate, TracFone confirms that prospective subscribers are not already receiving a Lifeline service and that there are no other subscribers to a Lifeline service in the prospective subscriber’s household, as discussed further below. 10


Application Processes

Since the rollout of the National Verifier, TracFone has only enrolled customers whose eligibility has been verified by the National Verifier (or the State Lifeline Administrator in those states that have opted out of NLAD). In NLAD states, TracFone’s role in determining consumer eligibility for Lifeline is thus limited to checking the NLAD to verify whether the potential customer is already qualified by the National Verifier. If the potential customer is not pre-qualified, TracFone redirects the customer to the National Verifier Consumer Portal to check for Lifeline eligibility and submit documentation if necessary, initial disclaimers, and provide an e-signature. 11 ___________________________________________________________

8) 2016 Lifeline Modernization Order ¶ 7; see 47 C.F.R. § 54.409(a)(2), (b).

9) There are two states that have opted out of the NLAD in which TracFone has an ETC designation. In those states – California and Texas – the eligibility determination is made by the relevant State Lifeline Administrator. Although California and Texas have opted out of the NLAD, they are still an integral part of the National Verifier system. See Wireline Competition Bureau Announces the Launch of the National Lifeline Eligibility Verifier in Oregon and Texas, Public Notice, DA 20-1237 (WCB Oct. 19, 2020); Wireline Competition Bureau Announces the Launch of the National Lifeline Eligibility Verifier in California, Public Notice, DA 20-1372 (WCB Nov. 18, 2020).

10) 47 C.F.R. § 54.409(c).

11) In Texas and California, TracFone collects proof of eligibility and other required documentation, but only for the purpose of submitting it to the State Lifeline Administrator for review and final approval. TracFone reviews this proof for the limited purpose of identifying possible errors prior to submission to the State Lifeline Administrators.

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Prospective subscribers may apply for TracFone’s Lifeline-supported service via one of four channels

  • First, prospective subscribers to the SafeLink-branded, Lifeline-supported service, may apply in person with Enrollment Representatives. The Enrollment Representatives use a provided tablet to assist prospective subscribers in applying for SafeLink service. These Enrollment Representatives (also known as Field Agents or “Street Teams”) are employees of third-party marketing agencies or indirect sales agents and are assigned a unique promotional code that enables TracFone to track enrollments to the particular agent. All Enrollment Representatives are required to take a training course regarding Lifeline’s rules, receive and acknowledge a copy of the Compliance Policy and the Compliance Manual, and must sign in with their credentials to the TracFone proprietary Field Agent mobile app used for enrollment. Enrollment Representatives must have a Representative Accountability Database (“RAD”) ID to log in to the mobile app in National Verifier states.12
  • Second, prospective subscribers may complete an application over the telephone by speaking to a customer service representative. If the prospective subscriber is not already qualified through the National Verifier, the agent instructs the prospective subscriber to complete an application online via the National Verifier Consumer Portal or refers them to the State Lifeline Administrator in California or Texas to obtain an application. 13
  • Third, prospective subscribers may apply for Lifeline-supported services online via SafeLink, (www.safelinkwireless.com), Simple Mobile (www.simplemobile.com), Straight Talk (www.straighttalk.com), Total Wireless (www.totalwireless.com) or Walmart Family Mobile (https://wfmassist.com/en/#!/home). The online form takes prospective subscribers through the enrollment process, including transferring them to the National Verifier Consumer Portal or gathering information/documentation which TracFone then transfers to the State Lifeline Administrator in California and Texas.
  • Fourth, prospective subscribers may apply for Lifeline-supported services in select stores through a self service QR Code or Kiosks. In select Simple Mobile Stores, prospective subscribers can enroll via RAD certified Enrollment Representatives or by using self-service kiosks.

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12) Any identification documentation collected are retained pursuant to the 2015 Lifeline Order. See Lifeline and Link Up Reform and Modernization; Telecommunications Carriers Eligible for Universal Service Support; Connect America Fund, Second Further Notice of Proposed Rulemaking, Order on Reconsideration, Second Report and Order, and Memorandum Opinion and Order, 30 FCC Rcd. 7818 ¶ 224 (2015) (“2015 Lifeline Order”).

13) In Texas, the consumer can complete the Lifeline disclaimers and certifications verbally via voice recording over the phone with the customer service representative.

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As discussed in greater detail below, TracFone does not offer or provide to Enrollment Representatives or their direct supervisors any commission or other compensation that is based on the number of consumers who apply for or are enrolled in the Lifeline program with TracFone, 14 and TracFone requires that all Enrollment Representatives register with USAC before they can provide information directly or indirectly to NLAD or the National Verifier. 15 TracFone requires all of its agents who directly or indirectly provide information to USAC or a state entity administering the Lifeline Program for the purpose of eligibility verification, enrollment, recertification, subscriber personal information updates, benefit transfers or de-enrollment to register with USAC.


Eligibility Determinations and Subscriber Certifications

The following policies and procedures enable current and prospective subscribers to demonstrate their eligibility for Lifeline assistance to TracFone personnel, in compliance with the Commission’s Lifeline Program Rules and any applicable state certification requirements. 16 When a subscriber seeks to enroll in Lifeline, whether on the basis of that subscriber’s income eligibility or on the program-based eligibility criteria, 17TracFone does not seek reimbursement for providing Lifeline-supported service to that subscriber unless and until TracFone has received from the National Verifier notice that the prospective subscriber meets the relevant criteria. 18

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14) See 47 C.F.R. § 54.406(b). Enrollment representatives act on behalf of TracFone or a third-party entity and directly or indirectly provide information to USAC or a state entity administering Lifeline for the purpose of eligibility verification, enrollment, re-certification, subscriber personal information updates, benefit transfers, or de-enrollment. See id. § 54.400(p).

15) See id. § 54.406(a)

16) 2012 Lifeline Reform Order ¶ 61; 47 C.F.R. § 54.410(a).

17) See 47 C.F.R. § 54.409(a), (b).

18) See id. § 54.410(b)(2), (c)(2). Any identification documentation collected are retained pursuant to the 2015 Lifeline Order. See 2015 Lifeline Order¶ 224; 47 C.F.R. § 54.410(b)(2)(iii), (c)(2)(iii). In California and Texas, TracFone does not seek Lifeline reimbursement unless and until it has received a copy of the subscriber’s certification and notice from the State Lifeline Administrator that the subscriber meets the relevant eligibility criteria. 47 C.F.R. § 54.410(b)(2)(ii), (c)(2)(ii).

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TracFone utilizes the USAC standard application/certification form to gather income/program eligibility information, in compliance with the Commission’s rules. 19 In addition, TracFone personnel orally explain the certifications to applicants when they are enrolling in person or over the phone. 20 TracFone uses USAC’s standard application and certification forms 21 to ensure TracFone’s forms are fully compliant with section 54.410(d). 22


Procedures for Continuing Service to Lifeline Consumers

Annual Verification Procedures

Except during government approved waiver periods, all TracFone Lifeline subscribers are re-certified within 12 months after the subscriber’s service initiation date and within every 12 months thereafter by the National Verifier or State Lifeline Administrator. 23 Further, the annual re-certification materials inform the subscriber that he or she is being contacted to re-certify his or her continuing eligibility for Lifeline, and if the subscriber fails to respond, he or she will be de-enrolled from the program as discussed in Section C below. 24 TracFone does not consider a Lifeline subscriber who is not assessed a monthly fee to be activated and will not seek Lifeline reimbursement for that subscriber until the subscriber activates the service by engaging in “usage” of the service as that term is defined in section 54.407(c)(2) of the Commission’s rules.

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19) 47 C.F.R. § 54.410(d). Applicants that opt to complete a hardcopy form to qualify for Lifeline service are required to return the signed application/certification to the USAC Lifeline Support Center at: P.O. Box 7081, London, KY 40742. These applicants complete enrollment using any of the application channels discussed above. TracFone confirms that these applicants have been approved by the National Verifier and obtains their e-signature.

20) See 2012 Lifeline Reform Order ¶ 123.

21) See USAC, Lifeline Program Application Form (FCC Form 5629), https://www.usac.org/wp content/uploads/lifeline/documents/forms/LI_Application_NVstates.pdf

22) 47 C.F.R. § 54.410(d).

23) Id. § 54.410(f).

24) See 2012 Lifeline Reform Order ¶ 145.

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Activation and Usage

Any of these activities, if undertaken by the subscriber, will establish “usage” of the Lifeline service:

  • Completion of an outbound call or usage of data; • Purchase of minutes or data from TracFone as part of or to add to the subscriber's service plan;
  • Answering an incoming call from a party other than TracFone or TracFone’s agent or representative; 25
  • Responding to direct contact from TracFone and confirming that he or she wants to continue receiving Lifeline service; or
  • Sending a text message.

After service activation, TracFone does not seek reimbursement for any subscriber who has not used the service within the last thirty days, consistent with the requirements set forth in section 54.407(c)(2). 26 TracFone will not seek reimbursement for customers within the fifteen-day cure period unless the customer cures their non-usage by using the service during that period.


De-Enrollment

De-Enrollment for Ineligibility. If TracFone has a reasonable basis to believe that one of its Lifeline subscribers no longer meets the eligibility criteria, TracFone notifies the subscriber of impending termination in writing, complies with any state dispute resolution procedures applicable to Lifeline termination, and gives the subscriber thirty days to demonstrate continued eligibility. 27

In response, a demonstration of eligibility must comply with the annual recertification procedures set forth in section 54.410(f) of the Commission’s rules, including the submission of a certification form. 28

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25) TracFone maintains and regularly updates a list of phone numbers that it uses to contact customers and excludes calls from these numbers to a Lifeline customer in determining if a customer has used his or her Lifeline service.

26) 47 C.F.R. § 54.407(c)(2).

27) See 2012 Lifeline Reform Order ¶ 143; 47 C.F.R. § 54.405(e)(1).

28 47 C.F.R. § 54.410(f).

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A subscriber’s failure to provide the requested documentation results in de-enrollment from Lifeline within five business days after the expiration of the subscriber’s time to respond. 29 As required by the Commission’s rules, if a subscriber contacts TracFone and states that he or she is not eligible for Lifeline or wishes to de-enroll for any reason, TracFone de-enrolls the subscriber within two business days. 30 Subscribers can make this request either via TracFone’s customer service number or online, and are not required to submit any documentation.


Annual Recertification De-enrollment. The National Verifier (or, in Texas and California, the State Lifeline Administrator) is responsible for re-certification of a subscriber’s Lifeline eligibility. 31 TracFone de-enrolls subscribers who do not respond to the annual recertification request, or fail to provide the required certification to the National Verifier (or, in Texas and California, the State Lifeline Administrator), as instructed by USAC. 32 TracFone sends a written notice explaining that failure to respond to the recertification request within sixty days will result in the subscriber’s de-enrollment from the Lifeline program. 33 If the subscriber does not respond within sixty days, TracFone de-enrolls the subscriber within five business days after the expiration of the subscriber’s time to respond. 34

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28) 47 C.F.R. § 54.410(f).

29) See id. § 54.405(e)(1).

30) See id. § 54.405(e)(5).

31) Id. § 54.410(f).

32) See id. §§ 54.410(f)(5), 54.405(e)(4).

33) See id. § 54.405(e)(4)

34) See id. TracFone also sends messages to its customers to educate them regarding the annual recertification process and requirement, as contemplated by the 2012 Lifeline Reform Order. This type of educational recertification message is consistent with the 2012 Lifeline Reform Order, which states that “ETCs and states may also choose to notify subscribers about the re-certification requirements in their Lifeline outreach materials. By taking these actions, ETCs and states will ensure that consumers are aware of the importance of responding to re-certification efforts, and that they are not inadvertently disconnected due to a lack of understanding of program rules.” 2012 Lifeline Reform Order ¶ 145.

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De-enrollment for Non-Usage. In accordance with section 54.405(e)(3), TracFone provides Lifeline subscribers receiving a free-to-the-end-user service on the thirtieth day of non-usage with fifteen days’ notice, using clear, easily understood language, that the subscriber’s failure to use the Lifeline supported service within the fifteen- day cure period will result in service termination for non-usage. TracFone updates the NLAD within one day of de-enrolling a subscriber for non-usage and submits a non-usage de-enrollment report annually to USAC. 35


Program Integrity

Measures to Prevent Waste, Fraud, and Abuse

National Lifeline Accountability Database (NLAD). TracFone complies with the requirements of the NLAD and section 54.404 of the Commission’s rules. 36 Except for those states that have opted out of the NLAD, TracFone validates the applicant’s Lifeline eligibility with NLAD’s real-time API. 37

TracFone does not enroll or claim reimbursement for an applicant if the NLAD or the National Verifier (or applicable state database) cannot verify the identity of the applicant or the applicant’s status as alive, unless the applicant produces documentation to demonstrate his or her identity and status as alive to the National Verifier. 38

One Benefit Per-Household Certification. A household is a group of people who live together and share income and expenses. TracFone has implemented the requirements of the 2012 Lifeline Reform

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35) 2012 Lifeline Reform Order ¶ 257; see also 47 C.F.R. §§ 54.404(b)(10) and 54.405(e)(3), respectively.

36) 47 C.F.R. § 54.404(b).

37) See 2012 Lifeline Reform Order ¶ 203. TracFone transmits to the NLAD the information required for each new Lifeline subscriber. See id. ¶¶ 189-195; 47 C.F.R. § 54.404(b)(6). Further, TracFone updates each subscriber’s information in the NLAD within ten business days of any change, except for de-enrollment, which will be transmitted within one business day. See 47 C.F.R. § 54.404(b)(8), (10). Where a state has opted out of the NLAD, TracFone will query the state’s duplicates database. Id. § 54.404(a).

38) See id. § 54.404(b)(12)

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Order to ensure that it provides only one Lifeline benefit per household through the use of its application and certification forms discussed above, internal database checks, and its marketing materials discussed below.

For NLAD states, the prospective subscriber completes the Independent Economic Household Worksheet (“IEH Worksheet”) via the National Verifier Consumer Portal. For NLAD opt-out states (California and Texas), upon receiving an application for TracFone’s Lifeline-supported service, TracFone searches its own internal records to ensure that it does not already provide Lifeline-supported service to someone at the same residential address. 39 If it does, and if the applicant lives at an address with multiple households, TracFone requires the applicant to complete and submit a written document based on a USAC form containing the following: (1) an explanation of the Commission’s one-per household rule; (2) a check box that an applicant can mark to indicate that he or she lives at an address occupied by multiple households; (3) a space for the applicant to certify that he or she shares an address with other adults who do not contribute income to the applicant’s household and share in the household’s expenses or benefit from the applicant’s income, pursuant to the Commission’s definition; and (4) the penalty for a consumer’s failure to make the required one-per-household certification (i.e., de enrollment). 40

In addition, TracFone personnel are trained to emphasize the “one Lifeline-supported service per household” restriction in their direct communications with prospective subscribers. Training materials describe the limitation to one Lifeline phone per household and the need to ensure that the prospective subscriber is informed of this restriction. 41

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39) See 2012 Lifeline Reform Order ¶ 78.

40) Id. This certification may be collected by TracFone prior to initial enrollment, but the certification will not be recorded in NLAD unless TracFone receives a notification from NLAD or the state administrator that another Lifeline subscriber resides at the same address as the prospective subscriber. See 47 C.F.R.§ 54.404(b)(3).

41 In February 2015, TracFone added to the Street Team app, which is TracFone’s proprietary referral agent enrollment app, an audit tool that compares a photo of the agent and photos of the applicant taken during the Lifeline IEH Worksheet completion process to photos of the agent’s profile, in order to provide additional security against fraud. As noted above, TracFone’s Enrollment Representatives – including Street Team agents – do not perform verification of proof or qualify the applicant. Rather, the National Verifier is the final Lifeline eligibility approver (except in California and Texas, where the State Lifeline Administrator makes this determination)

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Marketing Materials. TracFone includes the following information regarding its Lifeline supported offerings on all relevant marketing materials: (1) it is a Lifeline-supported service; (2) Lifeline is a government assistance program; (3) the service is non-transferable; (4) only eligible consumers may enroll in the program; (5) the program is limited to one discount per household; (6) documentation is necessary for enrollment; and (7) TracFone’s name (as the ETC). 42 These statements are included in all print, audio, video, and electronic materials (including social networking media) used to describe or enroll subscribers in the service offering, as well as application and certification forms. 43

This also includes TracFone’s websites and any other material describing the service offering. 44 In addition, TracFone’s application/certification forms (developed by USAC) state that consumers who willfully make a false statement in order to obtain the Lifeline benefit can be punished by fine or imprisonment or can be barred from the program.45

Enrollment Representatives. TracFone complies with the 2019 Lifeline Reform Order and section 54.406 of the Commission’s rules. 46 Specifically, TracFone:

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42) See 2012 Lifeline Reform Order ¶ 275; 47 C.F.R. § 54.405(c).

43) See 2012 Lifeline Reform Order ¶ 275; 47 C.F.R. § 54.405(c).

44) See 2012 Lifeline Reform Order ¶ 275; 47 C.F.R. § 54.405(c).

45) See 47 C.F.R. § 54.410(d)(1).

46) Bridging the Digital Divide for Low-Income Consumers; Lifeline and Link Up Reform and Modernization; Telecommunications Carriers Eligible for Universal Service Support, Fifth Report and Order, Memorandum Opinion and Order and Order on Reconsideration, and Further Notice of Proposed Rulemaking, 34 FCC Rcd. 10886 (2019) (“2019 Lifeline Reform Order”);

47) C.F.R. § 54.406.

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  • Requires that all TracFone personnel who meet the definition of an “enrollment representative” 47 register for a RAD ID before they can provide information directly or indirectly to NLAD or the National Verifier; 48
  • Has policies and procedures in place to ensure that Enrollment Representatives do not use another person’s RAD ID to enroll Lifeline subscribers, or access the NLAD or the National Verifier; and
  • Has policies and procedures in place to ensure that Enrollment Representatives re-certify their status with USAC on an annual basis and update registration information within thirty days of any change in such information. 49

All customer-facing employees and agents, including Enrollment Representatives, must demonstrate their understanding of TracFone’s rules and policies by completing TracFone’s Lifeline training and certifying that they have received the Compliance Manual and Compliance Policy, and will follow the procedures to ensure compliance. The training is updated as needed. Further, TracFone employs a compliance officer to oversee training and compliance matters for its Lifeline service.

TracFone does not offer or provide to enrollment representatives or their direct supervisors any commission compensation that is based on the number of consumers who apply for or are enrolled in the Lifeline program with TracFone. 50

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47) Enrollment Representatives act on behalf of TracFone or a third-party entity and directly or indirectly provide information to USAC or a state entity administering Lifeline for the purpose of eligibility verification, enrollment, recertification, subscriber personal information updates, benefit transfers, or de enrollment. See 47 C.F.R.§ 54.400(p).

48) This requirement does not apply if the Enrollment Representative operates solely in a state that has been approved by the Commission to administer the Lifeline program without reliance on USAC’s systems, to the extent the state’s administration of the Lifeline program does not rely on the USAC’s systems. See id. § 54.406(a)(4).

49) See id. § 54.406(a).

50) See id. § 54.406(b)

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Company Reimbursements from the Fund

TracFone certifies, as part of each reimbursement request, that it is in compliance with all of the Commission’s Lifeline rules and, to the extent required, has obtained valid certification and verification forms from each of the subscribers for whom it is seeking reimbursement. 51 Pursuant to Section 2(g) of the Compliance Agreement, a member of the Oversight Team certifies and signs all USAC or FCC Forms required for participation in and funding under the Lifeline Program Rules and that TracFone maintains such certifications. Further, TracFone complies with the Commission’s requirement to use the number of eligible subscribers TracFone directly serves as of the snapshot date as indicated by the data in NLAD to obtain reimbursement for the provision of Lifeline support. 52 In addition, TracFone keeps accurate records as directed by USAC and as required by the Commission’s rules. 53


Whistleblower and Reporting Options

TracFone has created multiple avenues for allegations of Lifeline rule violations to be reported, including the ability to report anonymously. Reporting options include calling the ethics hotline (1-844- 894-8433), emailing the ethics department (Ethics@Verizon.com or Wrongdoing@Tracfone.com), Ethics website verizon.speakfullynow.com/ and direct email to the Compliance Officer Lifelinecomplianceofficer@verizon.com. These reporting options have been publicized on the

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51) See 2012 Lifeline Reform Order ¶ 128; 47 C.F.R. § 54.407(d).

52) See 47 C.F.R. § 54.407(a). In states that have provided the Commission with an approved valid certification pursuant to section 54.404(a) of the Commission’s rules, TracFone complies with the state administrator’s process for determining the number of subscribers to be claimed for each month.

53) See id. §§ 54.407(e), 54.410(b)(2)(iii), (c)(2)(iii), 54.417.

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SafeLink website and in training for all Covered Personnel. TracFone has established a process by which all allegations or complaints received from other sources which allege any violation of Lifeline rules will be directed to the Lifeline Fraud Loss and Control Team. This tracking process includes allegations received through customer service, employee tips, internal monitoring reports, ethics complaints and agency complaints (e.g., consumer complaints submitted to the FCC, state public utility commissions; attorneys general offices, etc.). The Fraud Loss and Control Team investigates such allegations. The Lifeline Compliance Officer and the Lifeline Fraud Loss and Control Team meet weekly to review any new allegations and ongoing investigations. The Lifeline Fraud Loss and Control Team works directly with the Lifeline Compliance Officer, as directed by the Oversight Team, to determine appropriate remediation.


Annual Company Reports and Certifications

TracFone submits an annual FCC Form 481 filing to the Commission providing TracFone’s business and affiliate information, terms and conditions of any voice telephony plans offered to Lifeline subscribers, and all other required information and certifications. 54 TracFone also submits an annual Form 555 filing to the Commission certifying, under penalty of perjury, that TracFone: (1) has policies and procedures in place to ensure that its Lifeline subscribers are eligible to receive Lifeline services; (2) is in compliance with all federal Lifeline certification procedures; and (3) is in compliance with the minimum service levels set forth in section 54.408 of the Commission’s rules. 55


Operating Procedures for Covered Personnel and Agents

Compliance Training Program.

TracFone’s Compliance Training Program instructs all Covered Personnel about the Lifeline Program Rules and any additional requirements for Covered Personnel set forth under the Compliance Agreement.

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54) See id. § 54.422.

55) See id. § 54.416(a).

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The Compliance Training Program includes online training tools and testing to verify the trainee’s understanding, with an electronic certification of completion that TracFone retains. TracFone periodically reviews and revises the Compliance Training Program as necessary so that it remains current and complete and to enhance its effectiveness.


As part of the Compliance Training Program, Covered Personnel are instructed to report promptly to the Compliance Officer or Compliance Hotline any known, alleged, or suspected non-compliance with the Lifeline Program Rules or the Compliance Manual and are instructed on the procedures for such reporting. Such procedures include both the process for online submissions, including the dedicated email address for the Lifeline Compliance Officer and for providing telephone numbers to call. Covered Personnel are also made aware of the USAC whistleblower hotline (website, email, and toll-free number). The training also explains how to access the Lifeline Program and related materials on TracFone’s intranet (in the case of TracFone employees) or through other means for Agents and contains an explanation of how to escalate any Lifeline Program-related questions through TracFone to appropriate TracFone personnel. The training package also emphasizes the potential ramifications of failing to comply with the Lifeline Program Rules.


Compliance training is repeated on an annual basis. The training for Covered Personnel ensures that the Lifeline Program Rules as well as elements in the Compliance Manual, Compliance Policy, and such other information and materials relevant to the role to be performed by the Covered Personnel under the Lifeline Program are adequately covered. The training program is accessible to all Covered Personnel. TracFone makes available written materials and/or links to such materials covering the matters addressed in the training, Compliance Manual and Compliance Policy so that these materials can be readily accessed by Covered Personnel.


Covered Personnel Requirements

All Covered Personnel are required to complete a satisfactory background and criminal history check conducted by TracFone or its vendors. TracFone reviews the results of each check and excludes from the TracFone Lifeline program any Covered Personnel whose results are not satisfactory. TracFone retains copies of such background and criminal history checks for the term of the Compliance Agreement.

All Covered Personnel are required to undergo training and testing pursuant to the Compliance Training Program. TracFone obtains certifications showing that each Covered Person has completed the Compliance Training Program and satisfied the testing requirements. TracFone retains such certifications for the term of the Compliance Agreement.

All Covered Personnel who will provide information directly or indirectly to the National Lifeline Accountability Database or the National Verifier are required to register in RAD. A badge and Promo Code will be issued to an Enrollment Representative (including issuance to both TracFone’s own employees and any MasterAgent’s personnel) only after the requirements of these sections are satisfied. No Covered Person may begin to solicit customers for Lifeline until the applicable requirements under this section are satisfied and appropriately documented.


Master Agent and Enrollment Representative’s Requirements

All contracts with Master Agents must include terms that satisfy the requirements of the Compliance Agreement. TracFone retains documentation of satisfaction of these requirements for all Covered Personnel for the term of the Compliance Agreement.


TracFone shall issue (either directly or through its Master Agents) to each Enrollment Representative an identification badge containing the Enrollment Representative’s photo, which the individual Enrollment Representatives must wear at all times when representing TracFone for the purposes of soliciting customers to enroll in Lifeline. Badges are not issued to an Enrollment Representative until that individual has satisfied the requirements of this Policy pertaining to registration, training, and background and criminal history checks.


Each Enrollment Representative may enroll customers for a Lifeline service using only his/her individual Promo Code provided by TracFone. Only the Enrollment Representative assigned the Individual Promo Code may use that code, and the Promo Code must enable tracking of specific enrollments to the Enrollment Representative who entered them.


A Master Agent, through its Enrollment Representative, may solicit customers for a Lifeline service only in states or pre-established geographic locations expressly approved by the Compliance Officer or his or her designee


Covered Personnel may use only advertising, marketing, and customer enrollment materials for Lifeline that have been expressly approved by the Compliance Officer or his or her designee. Any alteration or modification of the material will nullify the approval.


All Covered Personnel working for a Master Agent must meet the compliance training requirements described in Section 4 of the Compliance Agreement and each Enrollment Representative is responsible for ensuring that it shall not use Covered Personnel to solicit customers to enroll in Lifeline unless and until those requirements are satisfied and the necessary certifications have been provided to the Compliance Officer.


Master Agents and their Covered Personnel who are suspected of violating Lifeline Rules are subject to immediate suspension from TracFone’s Lifeline program and if such violations are demonstrated, such Enrollment Representatives or individuals are immediately removed from TracFone’s Lifeline program. In addition, any Covered Personnel that are TracFone employees who commit any such violations shall also be immediately removed from TracFone’s Lifeline program.


Master Agents and their Covered Personnel who fail to comply with the Compliance Manual or this Compliance Policy shall be subject to corrective action, which may vary depending on the nature and severity of the non-compliance.


No Enrollment Representatives or their direct supervisors shall be compensated based on the number of consumers who apply for or are enrolled in the Lifeline Program, consistent with the prohibition of commissions in 47 C.F.R. § 54.406(b);


Covered Personnel are instructed that if they become aware of any known, alleged, or suspected non-compliance with the Lifeline Program Rules, Compliance Policy, or Compliance Manual, they shall promptly report it to the Compliance Officer or through the Compliance Hotline;


Each Master Agent shall be required to provide to its Enrollment Representatives, the online training materials and the Compliance Manual (with any updates) required by the compliance Agreement, as well as any other updated compliance materials developed by TracFone.


Each Master Agent agrees to make available to TracFone and to the FCC, upon request (and without requiring a subpoena unless the request seeks information or documents for which a subpoena or other formal legal process is required by law), access to all documents and records relating to the Master Agent’s work for TracFone, including without limitation documents and records related to Enrollment Representatives, efforts to comply with the terms of any agreement between TracFone and the Master Agent, and such other information related to solicitation of customers to enroll in Lifeline for TracFone as may be requested; and


Master Agents also must ensure that each Enrollment Representative who will enroll applicants in the Lifeline Program registers with RAD and maintains their registration.


Compliance Monitoring and Testing Program

TracFone’s Lifeline Fraud Loss and Control Team investigates potential fraud related to TracFone’s Lifeline program. The Lifeline Fraud Loss and Control Team reports to the Compliance Officer. The Compliance Officer, in consultation with the Oversight Team, supervises the activities of this team.


The Lifeline Fraud Loss and Control Team reports to the Compliance Officer any known, alleged, or suspected Lifeline Program non-compliance within seven days of detection or date of a report of such non-compliance made to the Lifeline Fraud Loss and Control Team. The Lifeline Fraud Loss and Control Team seeks assistance and advice from legal counsel and the Oversight Team as appropriate. In addition to the foregoing, and among other activities, the Lifeline Fraud Loss and Control Team:


  • Conducts periodic monitoring of the customer enrollment process to verify that Covered Personnel are complying with the applicable enrollment rules;
  • Conducts periodic monitoring to ensure that Enrollment Representatives agents are complying with their obligations to properly hire, train and use Covered Personnel;
  • Investigates known, alleged or suspected non-compliance with the terms of the Compliance Agreement, the Compliance Manual or the Lifeline Rules based upon customer complaints; complaints, reports, or tips from Covered Personnel; information obtained through periodic monitoring including the reports described below; or any other credible information obtained through the Compliance Hotline, or as reported to TracFone by the Commission as a result of information obtained through the FCC OIG’s hotline, or USAC’s Whistleblower hotline or that may otherwise come to the attention of the Lifeline Fraud Loss and Control Team;
  • monitors that persons enrolled in the Lifeline Program with TracFone were properly enrolled, and that TracFone de-enrolls subscribers from program participation pursuant to 47 C.F.R. § 54.405, as applicable.

The Lifeline Fraud Loss and Control Team will investigate alleged or suspected non-compliance based on the following metrics reports and such other analyses of non-compliance with the Lifeline Rules that the Compliance Officer or the Oversight Team may subsequently prescribe:


  • High velocity reports – reports of unusually high numbers of enrollments associated with specific promo codes or specific Covered Personnel.
  • Service not requested reports – reports of customers who received handsets or were notified they were enrolled in Lifeline, but who indicate that they did not request enrollment in Lifeline. • Multiple parties at the same address reports – reports specifying all locations where ten (10) or more Lifeline subscribers are enrolled or where multiple handsets were shipped to determine whether such an address qualifies as a group living facility, including but not limited to nursing homes, shelters, halfway houses, boarding houses, and apartment buildings without individual unit numbers.
  • Parties at non-existent address reports – reports identifying where handsets could not be delivered due to wrong addresses or where handsets were rejected or returned by customers at those addresses.
  • Enrollment activation spike reports – reports of Enrollment Representatives enrolling large numbers of subscribers compared with statistical thresholds.
  • Sampling – Periodic reviews of approved enrollments to ensure that Enrollment Representatives submit applications with eligible supporting documentation and accurate applicant information.

To ensure sufficient and timely oversight, the Lifeline Fraud Loss and Control Team generates the above reports on at least a monthly basis. When training Covered Personnel and distributing its Compliance Policy to Covered Personnel, TracFone need not specify the methods and practices used by the Lifeline Fraud Loss and Control Team.


Compliance Officer and Oversight Team


Compliance Officer

The Compliance Officer shall be responsible for developing, implementing, and administering the Compliance Training Program and Compliance Manual, for overseeing TracFone’s fraud protection and detection activities for TracFone’s Lifeline Program, and for developing and implementing procedures to comply with the terms and conditions of the Compliance Policy.


Any employees who may be called upon to assist the Compliance Officer in discharging his or her duties shall be conversant with the Lifeline Program Rules and, if assisting the Compliance Officer with ensuring required training under the Compliance Agreement. The Compliance Officer shall perform his or her responsibilities in consultation with the Oversight Team. The Company shall promptly notify the Commission of its selection of Compliance Officer and provide information about the individual’s qualifications. If the Compliance Officer’s employment with TracFone ends or the Compliance Officer changes positions within TracFone during the term of the compliance Agreement, TracFone shall promptly (but in any event, no later than forty-five (45) days after the Compliance Officer’s departure) appoint a replacement Compliance Officer, notify the Commission of its selection of a replacement Compliance Officer, and provide information about the individual’s qualifications to the Commission. Verizon’s Chief Compliance Officer (or a designee thereof with the requisite corporate and organizational authority) will provide interim oversight until a replacement Compliance Officer is installed.


Oversight Team

The Oversight Team has supervisory responsibility for the Company’s compliance with the Compliance Agreement. The Oversight Team includes at least three people, comprised of senior corporate representatives from the legal, finance, and customer care and operations departments with responsibilities for TracFone’s offering of Lifeline services, including at least one senior representative from Verizon’s current legal or compliance departments who was also a Verizon employee prior to the Verizon Acquisition. The Oversight Team may contain additional individuals, and the individuals on the Oversight Team may change from time-to-time. During the term The Oversight Team in consultation with the Compliance Officer will serve as a resource for resolving questions relating to compliance with Lifeline Program Rules and with the terms of the Compliance Agreement. The Oversight Team is responsible to ensure that:


  • TracFone complies with the terms of the Compliance Agreement and the Lifeline Program Rules;
  • TracFone identifies and maintains a qualified Compliance Officer;
  • The Compliance Officer fully carries out the duties specified in the Compliance Agreement;
  • TracFone files all certifications and reports required by the Compliance Agreement, including the Compliance Reports;
  • Tracfone takes concrete steps to establish adequate internal controls to ensure the company: (i) monitors its operations to identify any suspected or alleged non-compliance with the terms of the Compliance Agreement and the Lifeline Program Rules; (ii) tracks and investigates all such suspicions and allegations as well as reports thereof; (iii) keeps records of these investigations and the findings therefrom (including the determination of whether each instance of known, alleged, or suspected non-compliance constitutes material non-compliance); (iv) appropriately remediates such non-compliance; and (v) reports on such non-compliance to the Verizon Chief Compliance Officer, the Commission, and USAC as set forth in the Compliance Agreement and as may be required by the Commission’s rules.
  • TracFone retains all records required by the Compliance Agreement, including certifications of completion of training under Section 4; and a member of the Oversight Team certifies and signs all USAC or FCC Forms required for participation in and funding under the Lifeline Program Rules and that TracFone maintains such certifications, which shall be provided to USAC or the FCC upon written request.

Appendix


A. Lifeline Program Compliance Agreement dated 3/4/2022

B. Lifeline Internal Compliance Manual - Lifeline latest revision date 11/26/2024

C. Enrollment Representative Compliance Manual - Lifeline latest revision date 11/26/2024

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