U.S. Sen. Charles E. Schumer is unveiling new legislation that will increase fines and impose harsher punishments on telemarketing companies that violate current federal 'Do Not Call' rules.
Companies are prevented from using machines that automatically dial numbers and then play pre-recorded telemarketing calls, unless given written permission by the recipient. Despite the regulations, the number of unwanted telemarketing calls, especially from these already illegal automated calling systems, have skyrocketed - there were more than 200,000 complaints filed with the Federal Trade Commission alone in April 2012, compared to 65,000 in October 2010, according to published reports.
One of the causes of the recent spike is the minor penalties against those who break the existing laws and use automated dialing machines. Technology has evolved in recent years to allow a single person to make millions of pre-recorded calls with the click of a mouse.
Under Schumer's legislation, the use of automated dialing machines would go from being a misdemeanor punishable by a small fine and no jail time to a felony punishable by up to 10 years in prison and $20,000 fines per call. In addition to being illegal, many of the automated calls involve scam artists and callers are often masked behind "caller ID spoofing," the practice of displaying a different number on the recipient's caller ID system. The Federal Trade Commission and Federal Communications Commission have attempted to crack down on such scam artists and robocallers, but have been hamstrung by the penalties they can impose. In addition to seeking higher penalties, Schumer is also calling on the FTC, the FCC and phone companies to work together to develop the technology to prevent caller-id spoofing and to identify illegal robocalls before they get to consumers.
"A family has the right to get through dinner without constantly being interrupted by phone calls from mortgage companies, credit card firms or even worse, scammers," Schumer said. "Congress has enacted the laws to fight back against these nuisances, but the companies are using new tricks, and now we must enact stiffer penalties to make sure the laws have teeth so the regulators can bring the rogue firms to heel."
Robocalls and pre-recorded telemarketing calls are phone calls that use computerized messages from telemarketing campaigns to deliver pre-recorded messages and automated dialing machines use computer software to randomly dial a phone number and then either play a pre-recorded message or connect to a live person. In many cases, these types of calls are made by fraudulent companies trying to steal money from the person on the other end of the phone. Many times, these calls are placed using "caller id spoofing." Companies that resort to "caller id spoofing" can make the caller id display the phone number of a government agency, credit card company or bank. Under the "Truth in Caller ID Act of 2009," this practice is illegal if used for the purpose of defrauding or otherwise causing harm.
Under the Telephone Consumer Protection Act, the current penalty for a company willfully using an automated dialing machine, pre-recorded telemarketing call or robocall for commercial purpose without express written consent of the consumer is up to $10,000. The crime is a misdemeanor and rarely results in serious punishment or any jail time at all. Schumer noted that these penalties are far too low and provide no incentive for shady telemarketing companies to comply.
The National "Do-Not-Call" Registry, managed by the FTC, was implemented in 2003 after the Do-Not-Call Implementation Act of 2003. The registry is designed to give people a choice about whether they would like to receive telemarketing calls at home. It was created to limit the number of telemarketing calls and robocalls made to U.S. households. In order to register, one may log onto the "Do-Not-Call" website and their phone number will be permanently placed in the registry. There are currently over 209 million phone numbers in the registry.
Published reports suggest that the number of robocall complaints by U.S. consumers has increased from 65,000 in October 2010 to over 212,000 in April 2012. The largest category of complaint was robocalls. Telemarketers are supposed to check the "Do-Not-Call" registry every 31 days to ensure that they do not call a newly updated phone number on the list. In 2007, over 65,000 telemarketers checked the registry, however, in 2011 only 34,000 telemarketers checked this list. If a person who is listed on the registry receives a telemarketing call, he or she can file a complaint on the "Do-Not-Call" website.