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U.S. Poised To Let Phone Companies Block Robocalls

FCC wants to give telecom carriers more leeway to manage unwanted calls. U.S. Poised To Let Phone Companies Block Robocalls

U.S. Poised To Let Phone Companies Block Robocalls

Responding to widespread consumer complaints, the Federal Communications Commission says it will take steps to give phone companies permission to block unwanted robocalls.

Americans get billions of unwanted phone calls annually, making it the No. 1 complaint received by the FCC. But carriers have long been wary of blocking robocalls for fear of breaking the regulator’s call-completion rules that require phone companies to make sure calls reach their intended recipient.

“The American people are fed up with illegal robocalls,” FCC chairman Ajit Pai told reporters Wednesday, saying the agency aims to make it easier for phone companies to block them.

Illegal robocalls, often containing recordings of scammers posing as a government agency, computer support technician or insurance salesperson, have exploded in recent years thanks to low-cost technology that allows for auto-dialing and obscuring a call’s origin. Stopping them has proved difficult in part because bad actors are hard to identify and punish and in part because some robocalls are legal, others are illegal and still others are simply unwanted.

Mr. Pai said the commission has scheduled a June 6 vote on a measure that would assure phone companies that block unwanted calls won’t run afoul of federal rules. The agency said it would enable phone companies to analyze their network traffic to spot and block robocalls. They could let customers create so-called white lists of approved callers and block all other incoming calls.

The regulator is also proposing a measure that would protect phone companies using a new authentication protocol for separating legitimate calls from illegitimate ones. Mr. Pai has encouraged carriers to adopt that call-verification framework, referred to as SHAKEN and STIR, by the end of this year. He told the House Energy and Commerce Committee Wednesday the agency would make the framework mandatory if carriers don’t adopt it.

The moves—particularly the portion allowing consumers to limit the calls they receive to just people or businesses in their contact lists—are likely to meet resistance from companies whose calls are legal, but often unwanted and considered annoying by recipients, such as debt collectors.

“Unwanted calls are not necessarily unlawful calls,” said Daniel Blynn, a partner at Venable LLP in Washington, D.C. He added that the proposals come with some unanswered questions such as how a legitimate company that is making legal calls and is placed on a spam caller list can remove itself from it.

ACA International, a trade group representing collection agencies, said Wednesday it supports efforts to combat illegal calls but “consumer harm results when legitimate business calls are blocked or mislabeled and people do not receive critical, sometimes exigent information they need.”

CTIA, a trade group representing mobile-phone manufacturers and wireless carriers, said “the wireless industry is committed to combating illegal and unwanted robocalls” and it will continue to work “with the FCC and other stakeholders to protect American consumers.”

For phone companies, “the traditional role was to just pass calls through. Now you’re potentially putting them on the hook for actually policing calls that go through,” said Daniel Delnero, a senior attorney at Squire Patton Boggs in Atlanta that advises companies on consumer class-action suits related to the Telephone Consumer Protection Act.

It remains uncertain whether the proposals will stem the flood of robocalls, and how much, if anything, consumers will pay for call-blocking services. Mr. Pai said the proposals “would likely greatly increase adoption” of call-blocking technology.

He encouraged phone companies to provide the service free, noting that fewer robocalls would also mean fewer complaints from customers and less spam traffic on their networks. But he stopped short of proposing to mandate that the services be free. He also said the proposals are designed to ensure emergency calls wouldn’t be blocked.


Updated: 5-29-2019

Businesses Balk At FCC Bid To Block Robocalls

Debt collectors, credit unions among those lobbying the FCC to reconsider its call-blocking proposal.

Some businesses are pushing back against a regulatory proposal that would allow phone companies to block unwanted robocalls.

Representatives for trade bodies that lobby on behalf of debt collectors, banks, health-care providers and other businesses met with Federal Communications Commission officials last week, urging them to delay a planned June 6 vote on the matter and instead seek public comment, people who attended the meeting said.

FCC Chairman Ajit Pai this month said the commission would vote on a measure allowing phone companies such as AT&T Inc. and Verizon Communications Inc. to analyze network traffic to spot and block unwanted robocalls without running afoul of federal rules.

The proposal is part of an effort to cut down on unwanted and illegal robocalls, but some businesses fear it could result in carriers also blocking automated calls from legitimate firms. Banks, collection agencies and merchants say automated calls are crucial, even though some consumers find them annoying.

Representatives for ACA International, a trade body for debt and collections companies, the American Association of Healthcare Administrative Management, the Credit Union National Association and the American Bankers Association were among those who met with FCC Commissioner Michael O’Rielly and a member of his staff, as well as a member of Commissioner Brendan Carr’s staff.

“It’s important that the commission take a hard look at some of the proposals to make sure that they are appropriately targeted to address the problem, illegal automated calls,” said Mark Brennan, a partner at Hogan Lovells US LLP, who is counsel to the health-care group and attended the meetings. The group supports efforts to stop illegal robocalls, he said.

The current call-blocking proposal could mean financial-services companies such as mortgage or educational lenders are unable to reach customers for informational purposes, which could keep them from complying with separate consumer-protection rules requiring such companies to contact customers under certain circumstances, some of the groups said.

The FCC proposal would allow consumers who feel call blocking is preventing them from receiving wanted calls to opt out of the service, a spokesman for Mr. Pai said. “The American people are sick and tired of receiving a flood of unwanted robocalls, and allowing carriers to use call-blocking services by default will help provide consumers with much-needed relief,” the spokesman said.

A spokesman for Mr. Carr declined to comment and a representative for Mr. O’Rielly didn’t respond to requests for comment.

Leah Dempsey, a senior counsel at ACA International, who attended the meetings, said the FCC should seek public comment. “It shouldn’t be something done in the cover of night,” she said.

Representatives for the trade groups also told regulators they are concerned that customers and callers won’t know when a call has been blocked.

Ryan Donovan, chief advocacy officer for the credit union group, said the proposal could lead to calls about financial or consumer health being blocked with neither party knowing. “What is an unwanted call, and how does the caller know that the call is unwanted? It’s very ambiguous,” he said.

Separately, Noble Systems Corp., an Atlanta-based call-center technology company, said the proposal created a public-safety issue because it could result in some urgent communications from schools or health-care providers being blocked if a phone company doesn’t classify them as emergency communications. Even if carriers made a so-called whitelist of emergency numbers, scammers would be able to discover and spoof them to trick consumers into answering their calls, the company said.

Consumer-advocacy groups, meanwhile, have said they worry that call blocking by the carriers could lead to additional monthly charges and billing confusion for customers.

Congress is separately pressing the FCC to crack down on robocalls. The Senate approved a bill 97-1 last week that toughens penalties for illegal calls and requires phone companies to implement a call-verification standard. The bill hasn’t yet cleared the House but has bipartisan support there. U.S. Poised To Let Phone, U.S. Poised To Let Phone, U.S. Poised To Let Phone, U.S. Poised To Let Phone, U.S. Poised To Let Phone, U.S. Poised To Let Phone

To Stop Robocalls, Parties Need to Understand Who Is a RoboCaller

FCC still needs to define an ‘auto-dialer’ and clarify how consumers can opt out of phone calls from legitimate businesses.

America’s telecommunications regulator passed rules last week that will let phone companies automatically block more robocalls. It hasn’t yet said what, exactly, constitutes such a call.

There is little debate that robocalls meant to deceive or scam consumers are bad, and that calls from schools or doctors’ offices are typically benign. It is the large and thorny middle ground—calls to consumers by legitimate businesses—where the Federal Communications Commission hasn’t set clear rules.

A vast field of class-action and other consumer lawsuits hangs in the balance. Companies can pay $500 to $1,500 per violation of the Telephone Consumer Protection Act, a federal law enacted in 1991 that governs telemarketing. Violations includecalling a consumer without his or her permission and can stem from the dialing equipment used.

The need for clarity is rooted in a federal appeals court ruling more than a year ago that said the FCC under the Obama administration overreached in its effort to stop telemarketing abuses.The court said the regulator too broadly defined what constitutes telemarketing abuses, particularly in its description of a so-called auto-dialer, the equipment used to make robocalls.

The FCC continues to seek public comment on what constitutes such a dialer. Congress could also pass legislation that clarifies the definition.

Courts nationwide have made disparate rulings and the number of TCPA-related cases filed has increased. A pro-business group, the U.S. Chamber Institute for Legal Reform, counted more than 3,100 TCPA-related lawsuits filed in the 17 months after the Obama-era FCC order, compared with about 2,100 such cases during the same amount of time before it.

Consumer advocates say these lawsuits provide a needed avenue for redress because many business calls pester and infuriate recipients.

In some cases, individuals cash in on the penalties businesses pay and seek ways to attract calls that could help them score settlements. A Pennsylvania man, for example, owns multiple phones and files multiple lawsuits against companies for telemarketing calls each year, court records show. A woman carried around a shoebox filled with prepaid cellphones hoping to catch erroneous telemarketing calls, according to court filings.

In one high-profile TCPA case that related to violations of the National Do Not Call Registry, attorneys won a $61 million jury verdict against Dish Network Corp. over marketing phone calls. An appeals court rejected Dish’s appeal last month.

A spokesman for Dish said the satellite-TV provider was disappointed with the court’s opinion. “It is undisputed that Dish contractually required its independent retailers to comply with telemarketing laws,” the company said.

Attorneys for large businesses say companies often settle because it is faster and cheaper than trial. Most companies try to comply with federal rules, those lawyers say.

“I can’t believe clients are getting hit with $500 to $1,500 per call, and we still don’t know what it is we are supposed to be using” to make automated calls, said Becca Wahlquist, a partner at Snell & Wilmer LLP, who wasn’t involved in the Dish case.

Attorneys for consumers say those who bring lawsuits are trying to stop disruptive calls that bother Americans. Matthew McCue, an attorney in Natick, Mass., who works on such cases, says he has two clients who have collectively won $100 million for consumers through cases involving TCPA violations.

“I learned the law, I learned what was right, and I just took it and ran with it,” said Diana Mey, 60, who lives in Wheeling, W.Va., and is one of those two customers.

Mr. McCue said the illegal telemarketing problem would be worse if not for class-action enforcement of the TCPA.

The FCC last week gave phone companies permission to analyze their network traffic and block unwanted and illegal robocalls rather than requiring customers to ask.

Verizon Communications Inc., for example, said it would expand a free junk-call-filtering service to its entire subscriber base in the coming months.

The burden of identifying unwanted and illegal robocalls falls on carriers, but the FCC didn’t address what constitutes an automated call. The regulator also is expected to clarify what constitutes opting out of receiving calls.

Michael McTigue, a partner at Akin Gump Strauss Hauer & Feld LLP who advises companies facing class-action lawsuits related to the TCPA, said he thinks the auto-dialer definition should be limited to technology that randomly or sequentially generates and calls numbers without human intervention.

That is a view shared by other business advocacy groups. Those groups say the rule shouldn’t ban calls made using databases of numbers compiled for customer calls or dialing systems that time phone calls to match when a human agent will be available.

Consumer advocates and attorneys say that definition is too narrow.

“If those are passed then there’ll be a flood of calls,” said Keith Keogh, a Chicago-based attorney who works on consumer class-action suits including cases focused on TCPA violations.

Updated: 1-28-2020

U.S. Targets Phone Companies for Allegedly Aiding Robocallers

Authorities seek court orders against New York, Arizona operations they say allowed hundreds of millions of illegal robocalls.

U.S. prosecutors sought restraining orders against two sets of telecommunications providers they said have facilitated hundreds of millions of fraudulent robocalls coming into the U.S. from overseas.

The Justice Department said Monday it had asked for the court orders restraining two groups of companies, one operating in New York and another in Arizona, from allegedly facilitating fraudulent calls. Authorities described the move as a first-of-its-kind legal action aimed at stemming the flood of calls inundating Americans. One of the orders had already been granted Monday afternoon against the New York operation, which included Global Voicecom Inc. and other companies, officials said.

The orders require the companies to stop letting fraudulent calls go through to recipients, or else face penalties.

Authorities typically haven’t targeted phone companies for calls their customers make. In this case, prosecutors said the firms knew they were connecting fraudulent calls and did so anyway on a massive scale. TollFreeDeals.com, one of the Arizona-operated phone companies, carried 720 million calls in a 23-day period, most lasting for less than a second, the Justice Department said, adding that the calls’ short durations indicated clearly that they were robocalls.

Global Voicecom, TollFreeDeals.com and the other companies targeted by the court orders didn’t immediately respond to requests for comment.

The court orders “should stop hundreds of millions of predatory robocalls,” Assistant Attorney General Jody Hunt told reporters Monday, adding that the action should “serve as a warning to other telecom providers.”

Robocalls aren’t always illegal, but they can be if made without recipients’ permission or if they facilitate fraud. Monday’s action is one of many efforts in Washington, D.C., to curb the scourge of illegal robocalls, which annoy many Americans and defraud others. Previous efforts to stem the tide of the calls haven’t worked, in part because mass dialing continues to be low-cost and easy to execute.

Authorities are trying to change that by going after phone companies that act as intermediaries, receiving millions of calls and connecting them to the U.S. telephone network, usually through the internet. The Federal Trade Commission in December won a similar court order halting the operations of a U.S. phone company that was allegedly part of a robocall scheme.

These U.S. companies make money by charging fractions of a cent for each call they connect. Officials said of the operations identified Monday that they were struck by how little infrastructure was needed: both groups of companies operated out of residential addresses with little more than a server and other basic equipment. Most of the calls originated from India, officials said.

“No matter how many calls we stop, there will likely be more,” said Gail Ennis, inspector general of the Social Security Administration, which was part of the team that brought Monday’s legal action along with investigators with the U.S. Postal Service and the Justice Department. Ms. Ennis said robocallers impersonate Social Security agents so often that witnesses frequently don’t believe her office’s investigators are truly federal agents. She and other officials emphasized that genuine federal agents won’t threaten citizens or ask for immediate payments.

Monday’s action didn’t include criminal charges against the telecommunications firms, their owners or the people who made the calls. Robocall typically cases haven’t included criminal penalties, a trend Congress sought to reverse as part of robocall legislation passed last year.

Officials said they could seek jail time or monetary penalties later but wanted to move as quickly as possible to curb the calls.

“We look forward to working closely with law enforcement colleagues in India and elsewhere around the world to identify those behind these calls so that we can bring them to justice,” said Mr. Hunt.

Updated: 2-27-2020

FCC Probe Finds Mobile Carriers Didn’t Safeguard Customer Location Data

AT&T, T-Mobile among companies facing hundreds of millions of dollars in fines, though they will likely fight decision.

The Federal Communications Commission is seeking hundreds of millions of dollars in fines from the country’s top cellphone carriers after officials found the companies failed to safeguard information about customers’ real-time locations, according to people familiar with the matter.

The telecommunications regulator in recent weeks informed AT&T Inc., Sprint Corp., T-Mobile US Inc. and Verizon Communications Inc of pending notices of apparent liability, the people said. Such notices aren’t final, and the companies can still argue they aren’t liable or should pay less. It would ultimately fall on the U.S. Justice Department to collect any penalties.

The proposed fines, which could total more than $200 million, are expected to be announced Friday, one of the people said. Last month, FCC chairman Ajit Pai notified members of Congress that an agency investigation had concluded that “one or more” carriers had apparently violated federal law by disclosing real-time location data.

The FCC moved after some of the carriers had continued sharing their subscribers’ coordinates even after they told members of Congress they were cutting off the middlemen companies from using their data feeds. Verizon has said it stopped sharing cellular location data in 2018. AT&T and T-Mobile said in early 2019 that they were cutting off some location data sharing.

The top U.S. wireless providers agreed to curb their data sharing after independent reporting found data aggregators were misusing feeds that provided subscribers’ real-time locations. Upon request, the carriers would pinpoint specific subscribers and share the result with middlemen companies, which then shared the information with hundreds of other businesses.

Some privacy advocates criticized the FCC action as overdue.

“Consumers have no choice but to share highly private information with a provider about everywhere they go” to obtain cellular service, said Laura Moy, associate director at the Center on Privacy & Technology at Georgetown Law. “Carriers are not allowed to turn around and sell that location information to anyone with a phone number and a few dollars to spend. But this has been a widespread practice, and the FCC has been slow to rein it in.”

Sen. Ron Wyden (D., Ore.), who wrote to carriers in 2018 after the location-sharing partnerships were revealed to ask about their data privacy practices, called the proposed fines inadequate. He said in a tweet that strong privacy legislation was needed.

Cellphone companies need to know their subscribers’ coordinates to route calls and data to the right place. That gives them a more consistent view of customers’ movements than app developers, which use global positioning systems, Wi-Fi and other data sources that users can shut off through their smartphone settings. Wireless carriers also sell anonymized location data to marketers.

Data aggregators LocationSmart Inc. and Zumigo Inc. told The Wall Street Journal they distributed real-time locations to legitimate clients, including bank fraud-detection departments and roadside assistance services. But others used the data feeds for what the carriers said were unauthorized purposes. One prison phone provider created a website that let law-enforcement agencies find the location of any cellphone user without obtaining a court order, the New York Times and Motherboard have reported.

The FCC didn’t offer the carriers any settlements, one of the people said. That might prompt some carriers to fight the charges against them through the commission’s administrative process.

The fines, if paid, could fall heavily on T-Mobile if it closes its planned merger with Sprint in the coming weeks. The two companies recently revised the terms of that agreement, which was worth $26 billion when it was signed two years ago.

Under the revised merger, the parent companies of T-Mobile and Sprint agreed to split the cost of any liabilities up to $200 million. Sprint owner SoftBank Group Corp. would be on the hook for excess liabilities above $200 million.

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