FTC, FCC Seek More Congressional Authority to Stem Robocalls
Congress should seek to limit telemarketing exemptions and permit enforcement officials to pursue third-party spoofing providers, FTC and FCC officials said at a hearing Wednesday of the Senate Subcommittee on Consumer Protection, Product Safety and Insurance. The prevalence of call spoofing, the practice of displaying false phone numbers on caller ID displays, remains a big hurdle for enforcement officials, witnesses said. Subcommittee Chair Claire McCaskill, D-Mo., railed against the increase in robocall complaints and said “these shady companies … remain a serious annoyance and abuse to consumers.”
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The FCC, which shares jurisdiction with the FTC over robocall enforcement, has issued more than 500 citations for robocall violations, said Eric Bash, associate chief of the FCC Enforcement Bureau. But there are “significant law enforcement challenges” that could be ameliorated by congressional action, he said. Bash suggested Congress give the FCC the authority to pursue robocall violators without having to issue citations, expand the statute of limitations from one year to two, extend robocall prohibitions outside of U.S. jurisdiction, and give the FCC authority over third-party spoofing providers.
The practice of call spoofing has some legitimate purposes, said Bash, such as residents of battered women’s homes who may seek to shield their actual phone numbers from those who may seek to abuse them. McCaskill questioned whether number blocking would be sufficient in such cases and asked whether enforcement officials should more aggressively pursue spoofing companies. “What do we need to do to strengthen the laws to go after the people who are providing these phony numbers because that is a huge part of the problem.”
Subcommittee Ranking Member Sen. Dean Heller, R-Nev., asked witnesses what other authorities Congress could give the FTC to overcome some of the agency’s enforcement challenges. Lois Greisman, associate director of the division of marketing practices at the FTC Bureau of Consumer Protection, suggested eliminating the common carrier exemption in the FTC Telemarketing Sales Rule. The FTC is “on the record for the last several years in support of its elimination; I certainly share that feeling,” she said. Companies providing public telecom facilities are currently exempt from the FTC’s rule. Other exempt institutions include banks, insurance companies, airlines and intrastate telemarketers.
All told, the FTC has halted “literally billions of illegal robocalls,” said Greisman. In April 2012 the FTC charged two people with $30 million in civil penalties for making more than 8 million robocalls to consumers, including more than 2.7 million calls to numbers on the federal Do Not Call Registry (CD April 3 p14). At the time the FTC said the penalty was the largest ever imposed for calls to consumers on the Do Not Call list. The calls fraudulently promised consumers they were qualified for governmental “cash grants” of up to $25,000, and invited them to pay a fee to learn how to collect the grants.
Carriers echoed the technical problems in pursuing illegal robocallers in their testimony during a subsequent panel. It is “virtually impossible to trace an interconnected VoIP call or an over-the-top text message,” said Michael Altschul, CTIA senior vice president-general counsel. U.S. telecom companies currently monitor data traffic for illegal robocalls and initiate legal actions against them when they're found, said Kevin Rupy, senior director-law and policy at USTelecom. But the interconnected nature of today’s telecom networks can’t be addressed by any single stakeholder -- “most of whom face significant legal limitations,” he said. Finding a silver bullet to the problem of robocalls “will be an ongoing challenge,” said Rupy. “Like so many issues that arise in the Internet space it is a constantly moving and evolving target."
The FTC recently held a competition aimed at providing the best solution to stopping illegal prerecorded phone calls (CD April 3 p15). The commission awarded $50,000 to two engineers, Serdar Danis and Aaron Foss, who focused on intercepting and filtering out the illegal calls by using technology that blacklists known robocaller phone numbers, while letting through calls from other phone numbers. Both proposals would use a “CAPTCHA” style challenge-response test to stymie unwanted robocalls from reaching the user.
Foss, who testified on the carrier panel, said his solution, called Nomorobo, wasn’t available but he hoped to provide it for free “by the end of the summer.” Foss dismissed many of the carriers’ concerns about technical solutions and said the “worst case scenario” is that some calls might be diverted to a person’s voice mail. “People would rather have a voice mailbox with five or six robocalls than receive five or six robocalls,” he said. McCaskill lauded Foss’s work and told witnesses: “It is always better to do it in the marketplace with a competitive solution rather than have the government do it with a heavy-handed solution.”