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The millions government pays industry to snoop

AP/ SMH | July 11, 2013
How much are your private conversations worth to the government? Turns out, it can be a lot, depending on the technology.

Online companies in particular tend to undercharge because they don't have established accounting systems, and hiring staff to track costs is more expensive than not charging the government at all, he said.

"Government doesn't have the manpower to wade through irrelevant material any more than providers have the bandwidth to bury them in records," Gidari said. "In reality, there is a pretty good equilibrium and balance, with the exception of phone records," which are free.

Not everyone agrees.

In 2009, then-New York criminal prosecutor John Prather sued several major telecommunications carriers in federal court in Northern California in 2009, including AT&T, Verizon and Sprint, for overcharging federal and state police agencies. In his complaint, Prather said phone companies have the technical ability to turn on a switch, duplicate call information and pass it along to law enforcement with little effort. Instead, Prather says his staff, while he was working as a city prosecutor, would receive convoluted bills with extraneous fees. That case is pending.

"They were monstrously more than what the telecoms could ever hope to charge for similar services in an open, competitive market, and the costs charged to the governments by telecoms did not represent reasonable prices as defined in the code of federal regulations," the lawsuit said.

The phone companies have asked the judge to dismiss the case. Prather's lawsuit claims whistle-blower status. If he wins, he stands to collect a percentage - estimated anywhere from 12 per cent to 25 per cent - of the money recovered from the companies.

 

 

 

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