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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."
Here's a registration free link thanks to Google.
And you expected any less with a pseudo-govermental federally mandated tax? The federal goverment has no business doing this; it should be done by the states as needed.
No, that would not be me, because I don't live in the US.
Maybe this snuck through because it was done in a separate program funded a different way, but it still amazes me that they thought they wouldn't get caught.
Am I part of the core demographic for Swedish Fish?
Justice has been served.
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 $20.7 million in fines and restitution.
Oh, I suppose theres no harm trying is there - if they get caught, they only pay double what they could have scammed.
You can't expect to wield supreme executive power, just because some watery tart threw a sword at you
Multimillions for a school lan? The school that I was at up until 2 years ago seemed like i could have bought all the IT equipment for a couple of hundred dollars. If that.
It must have been all the computers running Win98 and the IT guy wishing he hadn't moved to Win2000 on his main computer. And servers that don't run Linux!!! NT Server 4? Since I left, apparently they ended up having to install software on every second computer, with the costs and all.
That's M$ for you. Not that this is the case this time, except for the servers. The CAL idea though, the servers would have been expensive though...
Cough...oversight...cough
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.
...with a smaller fine and less legal bills than they otherwise would have faced. The evidence was there, and against them. "Big companies" will generally do what is in their best interest and have remarkably little "pride". Pleading guilty in this case was in their best interest.
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.
What do I do??
That would depend on which variety of non-english you are.
"Hi, I'm from the Government. I'm here to help you!"
Strange women lying in ponds distributing swords is no basis for a system of government.
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.
I work for a private non-profit school (as a tech-coordinator and network admin). Most of our kids are public district funded, so we are eligible for e-rate funded programs.
We have none, here's why:
E-rate, like most government programs, is waist high in beaurocratic paperwork and red-tape. No one in the system looks for competing bids for two reasons:
1. There is no financial incentive for schools to pick a low bidder - the money is free as far as they're concerned.
2. It adds an enormous amount of paperwork to an already overburdened school staff. Is it worth hiring a full-time position to take care of this for e-rate programs that you aren't guaranteed to receive?
Like any government system, it takes money from those who have it and tries to redistribute it to those that don't. It sounds nice - make the "haves" buy technology for the "havenots", but in reality only the "haves" have enough resources to pull it off.
We get our technology the "old-fashioned" way. We either pay for it out of school tuition, or we seek private grants.
-ted
Any time the public largesse is expanded there will be those that abuse it. There are always people that will see this public generosity as an opportunity for a free lunch
It's easier this way; the victims have a proven track record of paying up for outrageous demands.
I worked for a company contracted to ibm to write the content management software for a 10 million$ project to provide ohio public schools with "video on demand". as i understand it, ohio public schools aren't doing so hot. i'm sure all that money will make a big difference, since the kids won't have to wait for the teacher to stick the tape in the vcr...
the best part is, they were very concerned about having very good DRM to prevent all those teachers from warezing reading rainbow or something i guess.
anyway, i'd be this little boondoggle was paid for with erate money, and will come to the surface in the current brouhaha.
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.
http://www.joannejacobs.com/mtarchives/014084.html t io n=article&articleID=2893
http://www.parentadvocates.org/index.cfm?fuseac
What NEC did is bad, but don't forget a lot of school boards are just as responsible if not more so. They don't have accountability until after they do something wrong. The problem in Atlanta is really horrid as the per pupil expenditure for education in Atlanta is one of the highest yet produces some of the worst results (we are in the 12k per student range)
* Winners compare their achievements to their goals, losers compare theirs to that of others.
Okay, so there actually was a quote in the article: "Schools are being promised million-dollar systems when a system costing $10,000 would make more sense."
This is TWO orders of magnitude, and it is not printed as fact, but is merely a quotation, and even the quotation doesn't say that this exact thing ever happened.
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
I worked on an E-rate project years ago and saw this scam take place first hand. We were putting carrier class switches and high end file servers in schools connecting perhaps 20 computers.
/. moderators that I was trolling.
When I mentioned something about it at the time, it was decided by
who are those slashdot people? they swept over like Mongol-Tartars.
a) 1996 - Gore/Clinton tax *your* phone bill to "put internet on every school"
b) Any school can spend whatever money and get the ERATE fund to reimburse the school
The waste and subsequent abuse happened because this tax should not even have existed to begin with. If school districts had to spend their own money, based on *local* taxation , this sort of careless purchasing would not happen.
You vote for politicians who introduce taxes, you bring this upon yourself.
The next pasture is always greener
""found" the link? You couldn't add "&PARTNER=GOOGLE" to the end of the link? Give me a break... that is pathetic."
I didn't know &PARNTER=GOOGLE could give me the link. I guess I missed the memo. So I am thankful. But since you knew that already you should have passed the comment by and not said anything. Instead you become this whiny little bitch for no reason.
It was about paying off Al Gore's supporters in Silicon Valley. NEC was doing exactly what it was supposed to do.
We must be alert to the danger that public policy could become captive to a scientific-technological elite. - Eisenhower
"That employee, Desmond McQuoid, was the custodial supervisor of the district. He pleaded guilty to mail fraud last year and was sentenced to 21 months in prison, according to Mr. Havian, the lawyer for the school district. Mr. Havian said the suit against Video Network Communications was still pending."
Pretty brutal, eh? NEC gets away with a fine, while the person that they duped and intentionally threw money at gets sent to prison. And that, my friends, is what's wrong with our justice system. Not that he shouldn't have gone to jail, but I'd like to see some NEC people get sent up the river for this too... after all, the other guy was just duped by money. NEC and this other company they speak of actually planned the fraud and intentionally sought to take taxpayer money by the millions.
I mean, I could see a scenario here where the fellow might not have even realized the scope of what was about to happen. They bribed him so that no other competitive bids would come in: a person who was easily duped might have just assumed that they wanted the business, not that they were planning on bending the school district over if you know what I mean.
-Vendal Thornheart
More Info
Jason
"FORMAT C:" - Kills bugs dead!
"Every new law is a new opportunity for graft."
One of Heinlein's. It seems appropriate here.
Of COURSE collecting a big pot of tax money for "wiring the schools for internet" will attract those with the political connections to tap it. And of COURSE they will set their prices and install the equipment that gives them the entirety of that pot of money. Why the surprise?
If you want it done at a decent price you don't say: "Here's X billion dollars per year. Who can wire the schools for that?". You say: "School districts: Get hooked up. We've raised your budget a bit, but meet at least Y level of service and if there's any left over you can use it for equipment, supplies, teachers, books, software, sporting goods, building repairs, or whatever else you need."
But IMHO, while the opportunity for graft is ALWAYS a factor in new laws (even if not intentionally), this one DID have an ulterior motive:
By wiring the schools to the internet, the government added weight to the "protect the children" argument for passing regulations limiting what could be posted there.
You will recall the figurehead of this push was Al Gore, during the period when the air was filled with internet-content-regulation and for-the-CHILDren trial balloons - shortly after his wife Tipper's attempt to regulate music content was slapped down. (I believe the quote that got mangled into "Al Gore claims to have invented the Internet." came from that very push.)
The internet was created BY adults FOR adults - or at least the set of people that INCLUDES adults. It was intended to be a medium for transmitting ANY information, cheaply and without restriction. It's as much an adult world as the streets of a city. It has its universities, its industries, and its billboards. But it also has its red light districts, its radical political recruiters, and its underworld.
Children who are below the maturity level to wander this world unharmed should no more be encouraged to go there unsupervised than they should be bussed to the local "adult enterprise zone" and left on their own. And attempts to turn it into a padded cell for kids are as misguided, as tyrannical, and as futile as attempts to do the same to the streets of the city.
Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way