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NEC Admits To Ripping Off Schools Through E-Rate Program
MAurelius writes "The New York Times (regist. req'd) is reporting that NEC now admits to ripping off multiple low-income school districts by connecting them to the internet with equipment more advanced and expensive than necessary. Several orders of magnitude more expensive. All paid for by telephone rate-payers. That would be you."
NEC then sent a bill to the E-Rate administrators, a quasi-governmental agency for tens of millions of dollars more than the actual cost of the equipment.
....
If someone robs a bank overnight (no people harmed) and takes 10 million dollars the shit would hit the fan.
But a corporation?
and to pay $20.7 million in fines and restitution.
Oh, I suppose theres no harm trying is there - if they get caught, they only pay double what they could have scammed.
You can't expect to wield supreme executive power, just because some watery tart threw a sword at you
Having seen school budgets and taken coursework on school budgets and having had a hand in compiling a departmental school budget, I can state with some certainty that if a small group of influential people wants to hide something, they will hide it.
Granted, there are some amounts of money that can't be hidden, but this particular scam involved getting districts to buy too much unnecessary equiment (1 network server per classroom in one case) and overcharging for it because the districts didn't follow competitive-bidding procedures.
I guess the point I'm trying to make is that even though the budget process is "public," a lot of the particulars are obfuscated by those few who control the budget pen. There's always a fair amount of pork in any budget (schools included), but this particular scheme involved defrauding the federal government (as opposed to defrauding the citizens of a town), which is what is landing them in hot water.
What exactly is wrong with gaining karma from doing something that benefits the readers of slashdot? I'm thankful the grandparent found that link, and I'm thankful it was +5 so I could see it no matter what.
I think they claimed they "needed" the equipment.
It's as if you buy a computer at a store and they tell you that you have to add a 900$ sound card [which is just a cheap 10$ CMPCI clone] to make the computer work then pocket the difference.
How is that not fraud? You were told you needed the sound card [not true] and that the sale price was 900$ [also not true]. Similarly they were told they needed equipment that wasn't required.
I mean what is the alternative? If you can't rely on the word of the service provider than you might as well learn to be a medic, car mechanic, building architect, etc, etc, etc.
Granted I agree the average school I.T. guy is just some jackass college dropout [was my experience when in high school] who should have known better. I'd be happier if they burned some IT guys and NEC sales people simultaneously.
Tom
Someday, I'll have a real sig.
NEC then sent a bill to the E-Rate administrators, a quasi-governmental agency for tens of millions of dollars more than the actual cost of the equipment.
If they over charged tens of millions of dollars and are only paying back 20 million this seems like NEC still made money on the deal.
What every happened to triple damages?
So far as NEC is concerned crime still pays!
My school in North London had a server room full of expensive optical hardware, several firewalls and servers, bought at a cost to students of around a million pounds. I once managed to get my hands on a bandwidth usage chart, and found that a Linksys router, around 100 at the time, and three 20-port switches, each around 100 could easily cope with the usage patterns.
It's telling that the IT administrators who installed the million pound system where an equivalent solution under 500 could have worked just fine, all left that year. The school is left with a completely irrelevant infrastructure that costs thousands of pounds a year to maintain and support.
All of this happens because, when a school installs a system, it's not their money that's being spent, but that of the students (or sometimes the taxpayer). Big hardware firms love to wine and dine school purchasing directors in a bid to convince them that they really need this fancy kit. It's in all of their interests to squander the money, and nothing is happening to change that.
As a European I believe you'd better hve such a program run by independant beaurocrats than For Profit commercial interests.
As an American I think we'd have a better program if the school system wasn't controlled by the government.
Do you think a for-profit private school would have wasted their budget money like this?
But Unpossible, how will poor kids go to private schools? Through scholarship programs, through charity, through hard work. Those that have good parents and want to be educated will be educated.
Ironically, the word ironically is often used incorrectly.
Actually.. those who were responsible should have to pay them back at least 3 times, and from their personal account.
That a company takes the damage when things go wrong is understandable, but when people have intentionally screwed things up, they should be held personally accountable.
It amazes me that it seems acceptable to politicians that individual citizens can be put out of their life savings by an organisation like the RIAA over possibly endangering their income, while big corporations can rip of the citizens and the responsible people just walk away.
Then I realized it was just poor people who were getting ripped off. Whew! I mean, if NEC doesn't do it, some payday loan place or another scam artist will anyway.
This gets back to my rant on providing more money for education. There IS NO LACK OF FUNDS for Education in the United States, there is a TOTAL lack of of responsibility for those funds. I vote down (and will continue to do so) every school levey and politian that would increase school taxes. I think public schools are one of the most important institution we have in this country though. The issue is I have been to school recently as a 20 something I can tell you that most of their budget is waste. Why in heavens name do we need video on demand huge writing labs of computers fast one with P4s for word processing? Not to mention new uniforms for the band every year or half of the other eqipment they buy and never use. The huge mulitmedia room my HS built that I saw when I went back to visit cost close to a million dollars and according to my younger sister has been used all of about once in two years. Its all over kill, schools are run by a bunch of know nothing administrators that think technology is going to solve all their education problems. Instead of spending money on hightech schools should spend money on text books, teachers, and the building(a confortable enviorment is importand for learning). This is not to say they should not have a well outfited computer lab to teach things like computer science . I won't support any money for schools untill I see it being spent on what matters though, teachers and books. In MN Ventera cut the budget drasticly at first school admins tried all sorts of scare tactics like claiming they could only afford to run schools four days a week and would have to cut every after school program and riddiculous claims like that. What really happend though is Jessy pushed the budget through and schools had to start to be responsible with the money, I don't see as much flasy new toys but overall the schools have not suffered. They simply buy books and teachers and maintain the buildings. It works good. Now idealy we could not cut school budgets and pay teachers more, that might result in better teachers, and again as a recent grad I learned more from teachers then and multimedia presentation tought me. A good lecurer with a chalk and a blackboard is far more valuable then some hack with power point.
Repeal the 17th Amendment TODAY! Also Please Read http://www.gnu.org/philosophy/right-to-read.html