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FCC Slams Serial Robocaller With $120 Million Proposed Fine for "Spoofing" Numbers

We all get them.  Repeated marketing calls to our mobile and home phones with the incoming phone number altered to make it appear that it’s a local call, when in fact, the call is from a robo-scammer using IP technology to “spoof” the phone number.  As it turns out, there’s a federal law that makes such spoofing illegal, the Truth in Caller ID Act of 2009 (“TICIDA”), and in its first enforcement action under TICIDA, the FCC hit an alleged serial robocaller, Adrian Abramovich and his companies (together, Abramovich) with a whopping $120 million Notice of Apparent Liability for allegedly originating nearly 100 million such calls.

The Commission also issued a Citation and Order to Abramovich for alleged violations of the Telephone Consumer Protection Act (“TCPA”) for making unauthorized prerecorded telemarketing calls to emergency phone lines, wireless phones and residential phones without obtaining the required prior express written consent from the called party.  While TICIDA allows the Commission to directly fine first-time violators through its NAL authority, which it did here, in TCPA FCC enforcement actions involving entities and individuals that do not hold Commission authorizations, the Commission must first issue a citation, and then can only proceed with a fine if the recipient repeats the violation.  That still leaves Abramovich open to potentially monumental TCPA class action exposure.   The Citation and Order also notified Abromovich that he had violated the federal wire fraud statute by transmitting or causing to be transmitted, by means of wire, misleading or false statements with the intent to perpetrate a fraud.

According to the Commission, Abramovich ran a scheme where his spoofed calls appeared to originate from local numbers and offered, via a pre-recorded message, holiday vacations and cruises claiming to be associated with well-known American travel and hospitality companies.  The pre-recorded messages would prompt customers to “press 1” to secure their reservation.  Once a customer pressed “1”, the customer was transferred to a call center where live operators pushed vacation packages typically involving timeshare presentations, that were not affiliated with the well-known brands used in the recorded messages.  The Commission characterized Abramovich’s schemes as “one of the largest – and most dangerous – illegal robocalling campaigns the Commission has ever investigated.”  According to the Commission, in addition to defrauding consumers, the robocalling campaign also caused disruptions to an emergency medical paging service, which provides paging services for emergency room doctors, nurses, emergency medical technicians, and other first responders.

While significant in absolute terms, the $120 million proposed fine, according to the Commission, was significantly below the penalty that could have been proposed in the NAL.  Rather than fine the statutory maximum of $11,052 for each spoofing violation, or three times that amount for each day of a continuing violation, the Commission calculated the base forfeiture amount at $1,000 per unlawful spoofed call, since this was the first time the Commission used its TICIDA forfeiture authority.

Mr. Abromovitz now has an opportunity to respond to both the NAL and Citation.  Stopping illegal robocalling has been a key priority for Chairman Pai, and no doubt the Commission is expecting that the threat of huge monetary forfeiture penalties against the industry will provide a powerful incentive for roboscammers to look for other ways to make a buck.  Given the Commission’s struggle with fashioning tools to go after serial robocallers that do not have the effect of increasing TCPA exposure for established companies engaging in legitimate customer communications, we do not expect the Commission to back down from its proposed penalty, and expect this to be the start of a new enforcement initiative using TICIDA and its direct penalty provisions.

Copyright © 2019 Womble Bond Dickinson (US) LLP All Rights Reserved.

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About this Author

Rebecca E Jacobs. Womble Carlyle Law Firm, Communications Regulation Attorney, Internet Compliance Lawyer
Associate

Rebecca Jacobs has a comprehensive communications law practice, guiding clients in media law, Internet, telecom, cable and privacy/data protection matters.

She counsels communications industry clients in negotiating contracts and complex business transactions, as well as helping them resolve disputes and regulatory challenges. Her clients include cable operators, broadband service providers and telecommunications companies.

Rebecca has extensive experience in E-Rate...

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Martin L. Stern, Womble Carlyle Law Firm, Regulatory Policy Attorney
Partner

Mr. Stern provides legal and strategic counsel on regulatory, policy and commercial matters to telecommunications, information technology and media firms, including network operators, programmers, and technology companies, in the United States and globally.  He represents clients before the Administration, Congress, and federal agencies, including the FCC, U.S. Departments of Justice, Commerce, Transportation, and Homeland Security, FTC, White House Office of Science and Technology Policy, and CFIUS.  He also develops and executes regulatory and legislative strategies, including through trade associations and the formation and implementation of industry coalitions, and engages in associated advocacy.

Mr. Stern handles compliance, enforcement and policy matters across sectors and issues, including licensing requirements and regulatory classification. His recent work has involved Open Internet/broadband issues, spectrum matters and transactions, FCC Enforcement Bureau proceedings, TCPA/telemarketing, CPNI/privacy, universal service, telecom reporting, emergency calling, unmanned aircraft, connected vehicle/Internet of things, and distracted driving matters.

 

202-857-4417
Douglas Bonner, Womble Carlyle, communications litigation lawyer, antitrust attorney, government affairs legal counsel, regulatory law
Partner

Doug Bonner has more than 20 years of experience representing wireline and wireless telecommunications providers, cable TV, VoIP and broadcast companies in FCC, FTC and state regulatory proceedings, as well as in telecommunications-related litigation. His specific areas of practice include telecommunications and mass media; communications litigation; and antitrust, regulatory and government affairs, relating to the telecom industry.

Doug’s telecom litigation experience includes defending businesses engaged in telemarketing in consumer class...

202-857-4428