WASHINGTON-The Justice Department said five individuals were indicted and four of them arrested on charges of conspiracy, mail fraud and money laundering in connection with a $2.25 billion government program subsidizing Internet connections to schools and libraries.
The department said Haider Bokhari; his wife, Kelly Bokhari; his mother, Shahida Bokhari, each of whom is from Kenosha, Wis.; and brother Qasim Bokhari of St. Petersburg, Fla., were arrested April 1 on charges filed under seal March 16 in the U.S. District Court in Milwaukee and unsealed April 2. A third brother, Raza Bokhari, was also indicted, but the Justice Department said he is believed to be residing in Lahore, Pakistan.
The discounted educational, or E-Rate, for Internet access was written into the 1996 telecom act. Nearly $10 billion has been paid out in E-Rate grants since 1997. A House Commerce subcommittee is investigating the E-rate program. Lawmakers were prompted to act in response to harsh criticism of E-rate oversight in recent years by the Federal Communications Commission’s inspector general.
According to Justice, the indictment said Haider Bokhari and Qasim Bokhari in 2001 submitted invoices and other documents to the Universal Service Administrative Co.-the entity overseeing the Internet program-falsely claiming to have provided E-Rate goods and services to two schools in Milwaukee and one school in Chicago. Based on the allegedly fraudulent invoices and other documents, Justice said the indictment charges that the Universal Service Administrative Co. paid Haider Bokhari and Qasim Bokhari more than $1.2 million for goods and services that were not provided to the schools, Justice said.
The indictment further charges that Haider Bokhari and Qasim Bokhari conspired with other family members, brother Raza Bokhari, mother Shahida Bokhari, and Haider’s wife, Kelly Bokhari, to conduct numerous financial transactions involving the proceeds of the fraud to conceal and disguise the unlawful activity. These alleged financial transactions include wiring more than $600,000 to Pakistan, purchasing a residence in Kenosha and acquiring several automobiles.
The investigation is being conducted jointly by the Department’s antitrust division, the Federal Bureau of Investigation, the criminal investigation division of the Internal Revenue Service, and the inspector general’s office of the FCC, with assistance from the U.S. Attorney’s office for the eastern district of Wisconsin.
“These charges again demonstrate the commitment of the FCC office of inspector general and the antitrust division of the Department of Justice to investigate and prosecute individuals who defraud the E-rate program and underscore the benefits of the effective working relationship our office has established with the DOJ Antitrust Division,” said Thomas D. Bennett, assistant inspector general for universal service oversight.
The alleged violations carry jail time and hefty fines.
