FCC Asks "Gateway Service Providers" to Help Traceback Efforts of Foreign-Originating Calls, While FTC Warns VoIP Providers Against Facilitating Violations

The Federal Communications Commission (FCC) and Federal Trade Commission (FTC) have turned their respective regulatory views toward phone companies and other service providers to stem the tide of unlawful "robocalls" that may violate the Telephone Consumer Protection Act (TCPA), the Telemarketing Sales Rule (TSR), and/or other federal protections against unfair trade practices.

The incidence of unwanted and sometimes fraudulent prerecorded "robocalls" seems to have grown exponentially the last few years. Per government sources, many of these originate abroad and seek to advance a variety of scams and fraudulent practices.

At a minimum, these calls are unwelcome, disruptive, and may well violate restrictions on autodialer use and prerecorded messaging under the TCPA and TSR and in substance can embody unfair trade practices. Eradicating fraudulent robocalls and limiting the intrusion of unwanted calls generally has been a primary focus of recent regulatory and legislative efforts.

FCC Seeks Help From Gateway Service Providers

The most recent of these arises in the form of the Chief of the FCC's Enforcement Bureau sending letters to seven "gateway" service providers—All Access, Globex, Piratel, Talkie, Telcast, ThinQ, and Third Base—asking them to help track down originators of spoofed foreign robocalls, which the FCC characterizes as misusing these service providers' offerings.

Recipients are U.S.-based voice providers that accept foreign call traffic and terminate it to U.S. consumers and in that respect were identified by the FCC as "gateways" into the United States for robocalls originating overseas. The FCC stated that industry participation in call traceback efforts has already proven useful in combatting illegal robocalling and spoofing.

The FCC thus views these U.S. service providers as "uniquely situated to assist government and industry efforts to combat scam robocalls." The letters also seek information about these providers’ potential facilitation of international robocalls and encourages each to take steps to prevent illegal robocall traffic that originates outside the country.

VoIP Service Providers on Notice

Several days ahead of the FCC's announcement that it sent the letters, the FTC sent 19 letters of its own to VoIP service providers warning them against potential "assisting and facilitating" of illegal telemarketing or robocalls. The letters were designed to serve notice on the companies (and the industry generally) that the FTC will take action against service providers it believes are assisting sellers or telemarketers that the service-providers know or consciously avoid knowing are violating the TSR.

The FTC described the letters (which were not released) as highlighting such knowledge-conferring conduct as robocalls that make false or misleading statements to induce purchases or charitable contributions, misrepresentation of affiliation with a government agency, use of false or deceptive caller ID, prerecorded telemarketing for which express written permission has not been obtained, and initiating calls to numbers on the National Do Not Call Registry.

The FTC also cited its recent enforcement action in Texas federal court against a robocalling operation and the extent to which one of the named defendants (Globex, a VoIP service provider) handled traffic for TSR violators and which provider, as indicated above, was asked by the FCC to help identify illegal spoofed foreign robocalls.

The complaint is somewhat opaque about Globex's role, other than alleging that it knew or consciously avoided knowing its service was being used in ways that violated the TSR.

FCC Highlights DOJ Action Against Five VoIPs

The FCC statement also flagged the DOJ's recent announcement of its filing of civil actions against five companies that allegedly facilitated hundreds of millions of fraudulent robocalls. The DOJ identified the targets as including Ecommerce National LLC d/b/a TollFreeDeals.com; SIP Retail d/b/a sipretail.com; Global Voicecom Inc.; Global Telecommunication Services Inc.; and KAT Telecom Inc., a/k/a IP Dish.

The complaints alleged that the defendants were VoIP carriers operating over the internet rather than traditional phone lines to carry calls for "numerous foreign-based criminal organizations … to pass fraudulent government- and business-imposter fraud robocalls," thereby serving as "gateway carriers" for violations. DOJ cited the enormous volume of calls – more 700 million in one 23-day period for just one VoIP carrier defendant, of which more than 400 million lasted less than one second, thereby indicating they were robocalls.

DOJ also cited defendants’ use of spoofed caller ID numbers and what it apparently viewed as the obviously fraudulent content of calls to allege that the defendants ignored repeated red flags and warnings about the fraudulent and unlawful nature of the calls carried on their networks.

Proposed New Rules Would Establish Registration Process to Implement TRACED Act

The FCC characterized its attempt to get tracing assistance from the gateway carriers to whom it wrote as "part of a coordinated effort" with the FTC and DOJ. Its statement also noted that FCC Chairman Pai circulated for review by his fellow Commissioners proposed new rules that would establish a registration process for selecting a consortium to conduct private-led efforts to trace back the origin of suspected unlawful robocalls as part of the implementation of the recently enacted Telephone Robocall Abuse Criminal Enforcement and Deterrence Act (TRACED Act).

DWT is following developments in this area closely. We are happy to answer any questions you may have.

This article was originally featured as a communications advisory on DWT.com on February 11, 2020. Our editors have chosen to feature this article here for its coinciding subject matter.