The GAO just published a survey of the USF’s High Cost program, which attempts to lower phone prices for rural users. The GAO’s report found that the USF cannot keep track of its own payments. There is no measure for whether the program succeeds in its goals. And when the USF conducts “audits,” they just check whether data has been submitted – not whether the data is correct. No wonder the USF has been plagued by fraud.
For more on the fiasco that is the Universal Service Fund, check out this study done by Thomas Hazlett, Professor of Law and Economics at GMU.