OKC Telecom Owner Indicted For Scamming Federal Funds In Cell Phone Program

Wednesday, June 4th 2014, 6:49 pm
By: News On 6

The Department of Justice has charged an Oklahoma businessman and his associate in an multi-million dollar government-subsidized cell phone program "Lifeline" some say is a scam.

6 Investigates reporter Jennifer Loren was the first to question the company and its owner about questionable business practices.

Last July, 6 Investigates did everything it could to track down the owner of Icon Telecom, a cell phone company based in Oklahoma City. We wanted to question him about some unusual documents he turned into the feds to get millions in cell phone subsidies.

That man now faces three felony charges including a $20 million money laundering charge.

6/4/2014 Related Story: Oklahoma City-Based Telecom Owner, Associate Indicted On Federal Charges

Wes Chew owns Icon Telecom, or Icon Wireless, which gives away free cell phones in exchange for contracts to provide government-subsidized cell phone service.

The federal government paid Icon $35 a month for every person it signed up.

As we first reported last year, Icon reported to the feds they signed up 135,000 Oklahoma customers, raking in more than $58 million in subsidies.

But our investigation revealed that some of the information the company turned in didn't add up.

The federal indictment outlines a scam by Chew and a man named Oscar Perez-Zumaeta of Cancun, Mexico, who faces 10 felony charges.

U.S. v. Chew, Icon Telecom

U.S. v Perez-Zumaeta

U.S. Attorney Sanford Coats says it was a conspiracy to defraud the U.S. of as much money as possible, as quickly as possible.

"Fifty-eight million dollars over just a couple of years is a significant amount of money," Coats said.

The indictment says Chew paid Perez-Zumaeta's company more than a million dollars to recruit new customers for Icon.

But it says the staff "recruited those new customers" by using phone books, coming up with names and addresses for bogus Lifeline customers, then selling those phones on the streets for $5 each.

"Literally pulled out the white pages and started writing down names and addresses of individuals which Chew and Icon turned in to the FCC as subscribers...." Coats said.

No one at Icon's headquarters would talk to us when we first questioned them about it last summer, nor would Chew, Icon's owner, when he was reached by phone.

Chew: "How did you get my phone number?" Reporter: "Public record."

Chew: "Oh... from public records. I'm actually at the airport right now so I really don't have time to talk to you."

Reporter: "OK, can we set up a time when you come back?"

Chew: "No probably not..."

Today, Chew's attorneys responded to the allegations saying, "Mr. Chew and his company voluntarily refunded over $5.7 million to the Lifeline program and have been cooperating with the investigation for almost a year. He wants to make appropriate amends and put this matter behind him.

If convicted, Chew could face up to 10 years in prison and be fined $250,000.

Perez-Zumaeta could face up to 20 years in prison and nearly $2 million in fines.