You feel the buzzing in your pocket. You pull out your phone and notice it isn’t a weird number calling from Kissimee Florida. Rather, the first six digits of the number are local, so you answer. “Hi this is Elizabeth with Resort Rewards Center and you’ve just won…” ‘click’ you hang up, another telemarketer.

In the past few decades, advances in telephone technology have drastically altered our life for the better, but this technology has also enabled telemarketers and scammers to deceive callers using sophisticated techniques. One of the most popular techniques is known as “spoofing.” As defined by the FCC, spoofing “occurs when a caller deliberately falsifies the information transmitted to your Caller ID display to disguise their identity.”

When used to call people about things like their taxes or insurance, these spoofing calls are particularly valuable in deceiving consumers into divulging personal information. One infamous example is an IRS debt scam where victims are told they owe money to the IRS that must be paid promptly via pre-loaded debit cards or wire transfers. With Hurricane Irma and Hurricane Harvey recently decimating Texas and Florida, these practices are now being used to defraud vulnerable hurricane victims. Amidst reports received by the FCC that criminals have been using spoofing and robocalls to target victims with insurance scam calls, the FCC has posted consumer alerts urging consumers to be wary.

The laws governing this area are the Telephone Consumer Protection Act of 1991 (TCPA), which prohibits robocalls or autodialed advertisements without prior consent. Additionally, Congress attempted to tackle the problem of “spoofing” in 2009 with the Truth in Caller ID Act, codified in Section 227(e) of the TCPA. This act statutorily prohibits using misleading or inaccurate Caller ID information “with the intent to defraud, cause harm, or wrongfully obtain anything of value.” Additionally, if engaging in fraudulent activity, the federal wire fraud provision in Section 1343 of Title 18 prohibits the use of interstate wire communication to further a fraudulent scheme. As a result of violating any of these laws, violators are subject to fines for each individual violation.

Despite these statutory schemes, the practice of spoofing has continued at an alarming level. In June 2017, the FCC issued a Notice of Apparent Liability for Forfeiture (NAL) of $120 million against Adrian Abramovich, who used robocalls claiming to be with companies like Marriot and Hilton, but in fact connected customers to unaffiliated third parties to sell the customer vacation packages. In a three-month period, Abramovich made 96,758,223 robocalls. An FCC investigation revealed that each call used the first six digits of the caller ID number of the consumer, a practice known as “neighbor spoofing.” In August, the FCC again proposed an $82 million fine against an insurance operator for similar actions. These were the first instances of the full FCC proposing a forfeiture under the Truth in Caller ID Act for spoofing.

These fines are currently just proposed forfeitures as the FCC lacks the authority to impose such forfeitures without formally notifying the perpetrator their actions violated the TCPA and wire fraud statutes. In the case of Abramovich, the citation directed him to take immediate actions to comply with the TCPA and wire fraud statutes. Failure to do so allows the FCC to impose sanctions in the form of monetary forfeitures of up to $19,246 per violation of Section 227 and a minimum forfeiture of $5,000 per violation of wire fraud. Abramovich can challenge the findings in the NAL and can also request to meet with the Bureau to discuss his citation.

Going forward, the FCC and industry leaders are examining methods to combat these practices. Specifically, solutions have been aimed at equipping consumers with tools that can block these types of calls. Additionally, cellular providers have proposed to proactively block illegal, fraudulent, or unwanted robocalls before they ever reach someone’s phone. In May 2017, a Notice of Proposed Rule Making, titled Advanced Methods to Target and Eliminate Unlawful Robocalls, was opened for comments, which closed on July 31. Thus, this issue will be something to continue monitoring as the FCC attempts to formulate new regulations and changes in technology making identification of violators increasingly difficult. In the meantime, continue to think twice before you answer that “local” call.

Spencer Brooks

 

 

Leave a Reply

Your email address will not be published. Required fields are marked *

*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>