FTC Cracks Down on Robocalls

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Few things are as frustrating as receiving an automated call from a telemarketer, especially one that pitches dubious promotions. However, the Federal Trade Commission is now actively engaged in the fight to stop these robocalls.

The FTC announced yesterday that it had successfully convinced courts in Miami and Chicago to halt the operations of four major organizations that use robocalls, including SBN Peripherals Inc., a company based in Los Angeles that made more than 370 million pre-recorded calls last year alone, or more than 27 calls a second. According to the FTC, this telemarketing service prompted tens of thousands of complaints, more than any other robocalling service and was notorious for contacting consumers with false claims that they had “urgent information about the consumer’s auto warranty or credit card interest rate.” Those who fell for this statement were often duped into buying “inferior extended auto service contracts or worthless debt-reduction services.”

Each of the other calling services being prosecuted, including Asia Pacific, Repo B.V. and Dolce Group Worldwide, are also guilty of using similar tactics to sign up consumers for bad auto contracts. In some cases, you will be transferred to a “senior specialist” who will flat out lie about his company, making claims like, “I’m from your authorized Honda dealer.”

Even more fundamentally though, these businesses are violating an FTC policy that took effect September 2009 prohibiting telemarketing companies from using robocalls without the consumer’s consent in order to make money.

“Unless you have someone’s consent up-front and in writing to receive a robocall, just don’t do it. The rules could not be simpler than that, and we will go after telemarketers who ignore them,” said C. Steven Baker, the Midwest Region Director of the FTC, in a press release. The only prerecorded calls that are currently permitted are those that offer information, like school closures, or debt collection, as long as neither are promoting the sale of goods or services.

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