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FCC Takes Aim at Robocalls

| Nov 17, 2015 | News

    Your dinner begins, the phone rings, and an unfamiliar number lights up the caller ID. When you pick up the phone, it is Rachel from “cardholder services” on the line, cheerfully offering an irresistible bargain: lowered credit card interest rates in exchange for a small upfront fee. Perhaps you hang up the phone, but many other people who receive the same phone call take the bait, only later to discover that doing so cost them thousands of dollars in credit card charges. And by then, they are unable to reach Rachel to get their money back.

    ThinkstockPhotos-78772034“Rachel,” as it turns out, is often a robocaller: a pre-recorded telemarketing call that typically solicits credit card numbers and other sensitive information from unsuspecting recipients. Together, she and other robocallers have placed several billion calls to consumers over the past several years, costing them an estimated $350 million annually. But the Federal Communications Commission (FCC) is trying to change that. In its most recent attempt to pull the plug on Rachel and her friends, the agency has began publicly releasing data on consumers’ robocall complaints as part of a weekly initiative intended to help developers build do-not-call technologies.

    There are a slew of federal laws that govern telemarketers’ activities. Under the Telephone Consumer Protection Act of 1991 (TCPA), telemarketers must obtain consent before placing autodialed or prerecorded calls on consumers’ wireless phones and before calling landline numbers with pre-recorded calls. The law effectively bans autodialed calls, although it exempts autodialed informational messages—such as those concerning inclement weather or school closings—and autodialed calls coming from political groups, pollsters, and charities.

    Expanding these restrictions, the FCC issued a 2003 regulation mandating that telemarketers maintain a list of call recipients who had made a do-not-call request before ending the call. The Federal Trade Commission (FTC) maintains its own list—the National Do Not Call Registry—with which telemarketers also must comply. And the Truth in Caller ID Act of 2009 prohibits callers from employing false caller ID information. The penalties for violating these laws range from several hundred to several million dollars.

    But new technologies and ineffective enforcement measures have allowed telemarketers to flout these laws, industry experts explain. “Spoofing,” for example, is a technical trick that enables a telemarketer to falsify the call number or the name that is displayed on the recipient’s caller ID, thereby disguising the telemarketer’s identity. Yet because of technological advances like autodialing, which allows a single robocaller to place several thousand calls per minute, tracking down and penalizing individual callers has become increasingly difficult for the FCC.

    “It’s not just whack-a-mole,” Bikram Bandy, program coordinator for the National Do Not Call Registry, reportedly said about the difficulties of targeting individual robocallers. “We have to whack all the moles to really deliver to consumers who sign up on the [Do Not Call] registry the peace and quiet they want.”

    The FCC therefore has adopted a string of enforcement mechanisms over the past several years intended to target the telemarketing industry as a whole rather than to focus on individual telemarketers. The FCC issued an order in 2012, for example, revising its regulations. These revisions included: tightening the requirements for obtaining a consumer’s consent; eliminating the “established business relationship exemption,” which had allowed telemarketers to call anyone with whom they had previously communicated; and requiring that telemarketers provide consumers with an opt-out option at the end of the call.

    Furthermore, by more aggressively using its enforcement powers under Section 207(c) of the TCPA, the FCC has targeted a slew of businesses that violated telemarketing laws over the past several years. The agency has issued multiple citations to companies violating these laws, and has even imposed multi-million dollar fines on several of them.

    This past June, the FCC took what some analysts say is its most expansive enforcement action to date. The agency issued what it called a “package of declaratory rulings” in response to petitions from 21 companies and trade associations seeking clarification on certain provisions of federal law.

    One of the FCC’s most controversial determinations in its June rulings concerned the definition of “autodialer.” The federal law that bans autodialers defines the term as “equipment which has the capacity to store or produce telephone numbers to be called, using a random or sequential number generator; and to dial such numbers.” The FCC explained that the word “capacity” includes both the present and “potential future capability” of the dialing equipment—potentially subjecting many more types of dialing technologies to the federal ban on autodialing.

    In another recent decision, the FCC confirmed that telephone companies are legally allowed to offer consumers robocall-blocking technology. Phone companies had previously refused to offer the technology to consumers out of concern that it violated the Communications Act of 1934, which bars call-blocking as an unjust and unreasonable practice.

    On the heels of these rulings, the FCC has also recently announced that it will release consumer-reported data on robocallers. The agency will publish weekly spreadsheets based on complaints that it has received from consumers each week. These spreadsheets will include each telemarketer’s phone number, the time at which the telemarketer called, and the state from which the telemarketer placed the call, among other information.

    “Consumers want and deserve effective tools to empower them to choose the calls and texts they receive,” said the FCC’s Consumer and Governmental Affairs Bureau Chief Alison Kutler. “This data will help improve do-not-disturb technologies so they can provide the best service for consumers.”

    But some critics argue that this latest move is another one of the agency’s actions that threatens to lump together and block otherwise legal informational calls alongside scammers’ calls. As a result, consumers might be precluded from receiving valuable information, such as notifications from airlines about flight delays, critics say.

    A trade group representing the debt collection claims that the FCC’s data “will fail to recognize the difference between calling scams or unwanted solicitations and reasonable, non-solicitous, informational calls that provide necessary, expected and desired information to existing customers of businesses.”

    But it is unclear if there is validity to this concern that fraudulent and legitimate calls alike will be blocked, as the FCC just recently began this initiative. The agency published its first spreadsheet last month, and it plans to continue to release these spreadsheets indefinitely.



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