Garza shows off his wealth.

Rural Vermont residents relying on a wireless Internet provider experiencing service problems appear to be collateral damage after a series of scandals and criminal investigations may have prompted the alleged owner to flee to a middle eastern country with no extradition treaty with the United States.

Houston native Homero Josh Garza, 30, had his hands in as many as a dozen business ventures in Vermont, Delaware, and Massachusetts, including Brattleboro’s Great Auk Wireless. But the wireless ISP founded in 2004 apparently is no longer high on Garza’s list of priorities after the entrepreneur discovered the prospect of big profits mining Bitcoins.

GAW’s 1,000 wireless customers are trying to maintain their Internet service, which is experiencing a growing number of service failures. Recently, customers began having trouble sending and receiving email, with nobody answering a support line to help. Last week, the company’s website appeared to be down for several days. Vermont officials considered it another example of why they believe GAW has proven itself a subpar provider with troublesome service.

That could be worrisome in underserved areas like western Massachusetts, where wireless ISPs like GAW have been promoted as less costly alternatives to fiber to the home service. In 2012, Garza gave up on building broadband access in Ashland, Mass., despite being offered a $40,000 government broadband grant, according to the Christian Science Monitor.

Platterpus Records proprietor Dave Witthaus suggests residents and businesses might want to think twice about firms like GAW. Witthaus told Coindesk businesses dependent on the wireless service provider encountered “routine issues with connectivity and customer service.” He told the online publication some businesses switched providers after a two week phone outage in February.

“They could have done well in this area but the customer service has just been awful,” Witthaus said. “And now, two weeks without phone is just unacceptable.”

Is GAW Wireless operating on autopilot?

Garza’s performance in the Bitcoin world has been given similar reviews after his mining venture rose to prominence and then collapsed, leaving investors and regulators looking for answers.

Bitcoin, a digital currency, is not issued by any central banking authority. Instead, new coins are issued to those running complex software that verifies the alternative currency’s public ledger of earlier transactions. The process protects the virtual currency from tampering or other illicit acts like re-spending by its original owner. In return for volunteering computer time to help support the security of the Bitcoin, the software pays users transaction fees and a subsidy of newly minted coins.

The prospect of getting “free money” just by running software encouraged the start of a virtual Gold Rush. Instead of mining in the ground looking for precious metals, prospectors eventually sought investors to fund powerful computers dedicated entirely to “mining” for Bitcoins. The Bitcoin system only releases so many coins at a time, and that number has been dwindling by design and will eventually reach zero. As a result, individual enthusiasts running the Bitcoin software during their spare time have seen their awards deteriorate as large-scale “mining operations” capture a growing percentage of the newly issued currency. To combat this trend, mining pools share resources to compete with the larger players and private contractors sell individuals and clubs time and access on powerful computers in return for a “mining contract.”

Enter GAW, which stands for “Geniuses At Work.” Garza’s business depended on a steady stream of clients investing in his enormous mining operation. GAW Miners claimed it has 200,000 customers and $120 million in revenue in just six months. GAW also reportedly collected 28,000 Bitcoins worth over $10 million in just two months.

Garza was never modest showing off his success, appearing in a tuxedo flying around in a private jet, showing off a collection of expensive Ferraris, and living in a $600,000 5,300-square foot stone house outside of Springfield, Mass.

But even as Garza’s company began moving hundreds of “mining rigs” (high-powered computers) into its newly leased 150,000-square foot warehouse in Park Purvis, Miss., some disgruntled ex-clients and investors began complaining Garza’s record was heavy on promises and light on delivery. Bitcoin news sites also began expressing concern about Garza’s operation. At around the same time back in Vermont, Great Auk Wireless customers experienced a very serious service outage that disrupted their phone and Internet service. While the rumor mill swirled about Garza’s ethics, the Mississippi Power Company was investing hundreds of thousands of its dollars to upgrade power to Garza’s warehouse. In return, GAW committed to stay for at least one year. It left after just a few months, folding operations and leaving the utility with $220,000 in unpaid electric bills and over $73,000 in damages and costs. The utility sued and was ignored by GAW.

“Mississippi Power filed a motion for default judgment because GAW failed to answer or otherwise defend the lawsuit,” the power company said in a statement. “We are asking the court to give us a final judgment on the amount that’s owed on this account.”

GAW Miners’ data center in Mississippi.

Collecting any judgment may prove difficult because most of GAW’s employees and management have reportedly fled, resigned, or been terminated.

With GAW Miners largely defunct, the Securities and Exchange Commission has taken an interest, questioning whether Garza’s ventures involved unregulated securities, a big no-no with the feds. The SEC is also sharing its wealth of information with the Federal Trade Commission, which is investigating GAW Miners for potential false advertising. The Department of Homeland Security also wants to know if Garza was engaged in money laundering, and the IRS is pondering whether Garza reported all of his capital gains for tax purposes.

To get these answers, Garza’s firm was subpoenaed in February to turn over relevant documents. As of late May, Bitcoin traders suspect Garza has left the country and federal investigators behind and relocated to Dubai, in the United Arab Emirates, which has no extradition treaty with the U.S.

Taxpayers may also be victims.

GAW Wireless collected $18,018 in state grant money to expand wireless broadband service in 2014. The company never delivered the service, according to Vermont officials. A Maidstone couple also alleges GAW never paid them the $3,000 they agreed upon for leasing property in East Maidstone. Guy and Gail Giampaolo were to receive free Internet service and a $300 annual payment in return for the lease agreement. They reportedly received neither.

The VTDigger reported several other instances of service problems from the wireless venture in a detailed article published earlier this month. Even the state Attorney General has been unable to contact the company after an earlier letter was returned by the post office with no forwarding address. The Department of Public Service is asking customers who use GAW Wireless to call the Consumer Affairs Line at 1-800-622-4496. The department will provide customers with information about alternative wireless Internet service providers.

This weekend will end the first phase of our campaign to fight Cox usage caps being tested in Cleveland, Ohio. We’re collecting the names and e-mail addresses of interested citizens that would like to participate in the fight to get Cox to drop its usage-based billing and overlimit fee scheme. If you are interested, use the link at the top to “Contact Us” as a volunteer and include your name and a valid email address.

Next week we will have an initial outline for an action plan with hopes of building a team of Cleveland-area Cox customers to lead the fight. Local participation and involvement is essential to win these battles, and we will expect the city’s Internet enthusiasts to run this effort themselves, with support from Stop the Cap! It’s your fight to preserve your uncapped broadband, so please get involved!

[flv]http://www.phillipdampier.com/video/WEWS Cleveland Cox Changing Internet Service 5-19-15.mp4[/flv]

WEWS in Cleveland ran a story on Cox’s usage caps and interviewed Stop the Cap! about why usage-based pricing is typically a giant ripoff for customers. (2:12)

No data caps.

Charter Communications is now heavily advertising the fact its Internet service “has no data caps,” in an attempt to leverage customers away from AT&T DSL (150GB cap) and AT&T U-verse (250GB cap).

Charter quietly shelved its softly enforced usage caps several months ago and is now using its cap-free experience as a marketing tool to convince customers to switch from AT&T and other phone company broadband options that often include usage limits.

“They used it with me to convince me to drop U-verse for Charter,” writes Stop the Cap! reader Jennifer in Tennessee. “I hate usage caps.”

Charter is also using its cap-free broadband as a key argument in favor of its merger deal with Time Warner Cable and Bright House (which have no usage caps either).

“Charter’s slowest speed tier (60Mbps downstream) is considerably faster and less expensive than TWC’s comparable tiers, with no data caps or usage based pricing,” Charter argued in its merger presentation this morning.

AT&T has unevenly enforced usage caps on its DSL and U-verse services. A standard overlimit fee of $10 for each 50GB applies, but only in some markets.

Garofalo

Outrage from Minnesota’s elected officials representing rural districts around the state has embarrassed Minnesota House Republicans into grudgingly restoring a token amount of broadband funding to help small communities get online.

Earlier this month, the GOP majority’s budget proposal completely eliminated broadband development grants, which amounted to $20 million in 2014. Republicans attacked the spending as unnecessary and a wasteful “luxury.” The money was reallocated towards promoting tourism.

Budget point man Rep. Pat Garofalo (R-Farmington) said hardwired Internet access was outdated.

“The future is wireless and satellite Internet,” Garofalo declared, adding these were better, cheaper options for rural Minnesota.

Rural Minnesota strongly disagreed.

The West Central Tribune in Willmar declared the GOP budget proposal very disappointing to everyone in rural Minnesota.

“Rural Minnesota will continue to fall behind in broadband access and, in turn, the critical factors of quality of life, education, economic opportunities, access to health care and many other positive benefits,” the newspaper wrote in an editorial.

Rural Minnesota Broadband: Nothing to write home with a quill pen about.

“We are astonished as to why the House would ignore one of the state’s biggest economic development needs,” said Willmar City Council member Audrey Nelsen, a member of the Coalition of Greater Minnesota Cities’ board. “The lack of high-quality broadband affects communities and regions all across the state.”

“We agree,” the paper declared.

“High-speed Internet service is not a luxury, it is an absolute necessity for job and business growth,” said executive director Dan Dorman of the Greater Minnesota Partnership.

House Republicans seem intent on stomping out rural Minnesota’s digital economy. Broadband coverage in these areas is a disgrace: Kandiyohi County is third lowest in Minnesota, at only 13.18 percent, in the percentage of households with access to broadband that meets state-speed goals. Surrounding counties with low access percentages include: Chippewa at 24.47 percent, Yellow Medicine at 25.69, Swift at 30.41, Pope at 31.40 and Renville at 58.29.

In 2013, Gov. Dayton’s Broadband Task Force Report recommended a $100 million infrastructure fund to start addressing the $3.2 billion total investment needed statewide to address this issue. Garofalo seems ready to concede to an $8 million token allocation some Democrats call insulting.

Rep. Tim Mahoney said he believed 10 years of an annual $20 million investment would solve the rural broadband problem in Minnesota in a decade. The St. Paul Democrat believes with the GOP’s budget, it will take forever.

“For them to come up with $8 million is kind of ridiculous,” Mahoney said. “It’s almost a slap in the face.”

Garofalo believes AT&T and Verizon’s forthcoming home wireless broadband solutions will solve Minnesota’s broadband problems, without considering those services are expensive and tightly usage-capped. Satellite Internet is condemned by critics as costly “fraudband,” often speed-throttled and usage capped.

Fiber Internet, in Garofalo’s world view, is “yesterday’s technology,” despite ongoing investments in fiber to the home Internet around the world, including investments from companies including AT&T, Verizon, Google, and others that now offer fiber technology capable of speeds in excess of 1Gbps.

Sober assessments of the different broadband technologies available in Minnesota are already available from the state’s Office of Broadband Development. Garofalo’s budget resolves the ideological conflict between his views and theirs by eliminating the agency.

Garofalo said to save rural broadband, the state government must first kill any plan that might interfere with the private sector.

“The private sector won’t invest if it senses that the government is coming in with something else,” he said.

Without throwing Garofalo totally under the nearest tourist bus, House Ways and Means Committee chairman Jim Knoblach said the state needs rural broadband funding, even if other options such as wireless Internet may be a more efficient way to tackle the problem down the road.

“There are people waiting for broadband now that I think this would help,” the St. Cloud Republican said, supporting the restoration of $8 million in funding.

The two largest telecom companies in Zimbabwe believe broadband access isn’t just an essential utility — it’s a basic human right and they are responding with major upgrade projects that will deliver speedier broadband, sometimes even faster than what most customers in North America can access.

Anything less than fiber-to-the-home service won’t do, according to Tom Tudor, chief marketing officer at Liquid Telecom. The company is expanding its fiber project in Zimbabwe with popular tourist destination Victoria Falls getting a major upgrade. Liquid Telecom believes data caps are incompatible with the concept of bringing the Internet to more people to “participate in, and benefit from, the digital revolution.” Liquid Telecom’s fiber service – Fibroniks, doesn’t have usage limits or hidden gotcha fees.

“Every day we lay new fiber which enables us to deliver what we refer to as ‘The Real Internet’, a superfast service which transforms how people access and share information,” Tudor said.

At the outset in Victoria Falls, Fibroniks will offer unlimited use packages up to 100Mbps, with a commitment customers can access whatever they want, whenever they want, at a guaranteed fixed monthly price. Liquid Telecom already supplies fiber service in the capital city of Harare, but Tudor believes getting into smaller communities in the country is essential.

“We believe that internet connectivity is a basic human right and so it is our mission to provide quality broadband to every person and business in Africa,” said Tudor.

It will bring a broadband revolution to Victoria Falls, a community of over 35,000 that has languished with ADSL and last generation wireless services like WiMAX and 3G, which offer speeds typically no higher than 512kbps.

Fibroniks also includes telephone service, which will cost a fraction of what Tel•One, Zimbabwe’s sole fixed landline provider, charges for service. Tel•One has focused most of its investment improving and expanding ADSL service over its existing landline network. Although Tel•One may end up reaching more Zimbabwe citizens faster that Liquid Telecom, the speeds Tel•One provides will be much slower than Liquid Telecom’s Fibroniks.

Liquid Telecom’s other fiber to the home projects are in Zambia, with plans to expand to Kenya, Rwanda, and two other African countries yet to be announced.