Outraged FCC Takes Strong Action, Shakes Finger at Robocallers

Barred by law from imposing fines on first offenders, the agency can only issue threats.

Your cell phone rings. You pause the movie, untangle from your significant other, and stride across the room to answer it. “Hello there!” says the cheerful recorded voice. “We’re calling about your credit card! Are you paying too much interest?”

You stab at the hang-up button and head back to the couch, grumbling that there ought to be a law.

Actually, there is. You can read the FCC’s rule right here.  It’s been on the books for about ten years, based on a statute that Congress passed much earlier. Robocalls to cell phones are illegal, period (unless you have expressly agreed in advance).

So how can the robocallers keep doing it? Not only are the calls an irritant, but depending on your cell plan, you may be paying per-minute charges for the privilege of having your life interrupted. Robocalls have gotten so bad the Federal Trade Commission even offered a $50,000 prize for ideas on how to stop them.

Now, finally, the FCC has acted.

The FCC got the goods on two companies that specialize in making robocalls for other businesses. It has evidence that each made more than one million robocalls to wireless phones. Fines can amount to $16,000 per call; for a million calls, that adds up to $16 billion. In practice, of course, the FCC would not actually levy fines that high. But still, the penalties ought to be stiff. In these cases, the actual fines imposed amounted to . . . well, zero.

Not even equal to the victims’ per-minute charges.

How can that be?

By law, only certain kinds of wrongdoers are subject to an immediate fine: those who hold or applied for an FCC license, or whose offense consists of activities that need a license (such as operating a pirate radio station). As to everybody else, the FCC must first issue an official “citation” that warns the offender his conduct is illegal. Only if the same offender subsequently commits the same offense can the FCC impose a fine.

It’s too bad traffic violations don’t work the same way. I could breeze through a red light with a friendly wave for the officer, and all he could do, at least the first time, is politely tell me that running red lights is against the law.

The FCC has now issued citations against alleged robocallers Democratic Dialing and Dialing Services, LLC. Each citation sternly requires the recipient to promise it will stop violating the law or face possible fines.

Citations are required, presumably, to make sure the violator knows his actions are unlawful, and has a chance to reform, before he incurs sanctions. FCC licensees are different, being expected to know the rules they operate under. Some violations, like running an unlicensed FM station, may be so obviously against the law that no warning is needed. But we think someone who violated an FCC rule solely for commercial gain ought to be subject to fines without a prior citation. We don’t mean the hobbyist whose homebrew radio strays off frequency, or even the coffee-house proprietor who unknowingly installs a noncompliant Wi-Fi unit. But someone whose business plan is founded on flouting FCC rules (and annoying consumers) might reasonably be subject to fines without warning.

Unfortunately, this is not something the FCC can resolve by itself. The lenient treatment for first offenders is a requirement that Congress wrote into the law, so any fixes will have to come from Congress.

Will the violators in this case heed the citations and turn to a different line of work? Or will they just shift the robocall operations among different companies that have not yet received a citation? Keep an ear out for your cell phone, and you’ll know soon enough.

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Comments (4) Read through and enter the discussion with the form at the end
MarC - March 18, 2013 9:16 AM

Excuse me Mitchell, but since 47 USC 227 provides me (the consumer) with some protection, can't I (or all of us, in a class action suit guaranteed to makes lawyers salivate) sue the pants off the offenders?

(47USC227 states:
"(1) Prohibitions
It shall be unlawful for any person within the United States, or any person outside the United States if the recipient is within the United States

(A) to make any call (other than a call made for emergency purposes or made with the prior express consent of the called party) using any automatic telephone dialing system or an artificial or prerecorded voice
...
(iii) to any telephone number assigned to a paging service, cellular telephone service, specialized mobile radio service, or other radio common carrier service, or any service for which the called party is charged for the call")

MarC

Mitchell Lazarus - March 18, 2013 11:07 AM

Marc -- If only it were so! Unfortunately an individual (or a class) cannot sue to enforce a statute unless the statute says so, by allowing what is called a “private right of action.” Congress in its wisdom has not seen fit to include a private right of action as to robocalls.

Mitchell

Mitchell Lazarus - March 18, 2013 12:46 PM

Correction: The federal robocall statute does provide a private right of action, but the suit must be brought in state court, and the plaintiff can recover only his out-of-pocket loss or $500, whichever is greater -- or up to three times that if he can prove the robocaller violated the law "willfully or knowingly." 47 U.S.C. Sec. 227(b)(3). These amounts are not nearly enough to justify an individual's bringing a lawsuit; and the need to file separately in each state discourages class actions.

Mitchell Lazarus

Mark - March 19, 2013 7:23 AM

I'm curious. Why is the FCC going to go after the technology providers instead of the candidates who make the recordings for the calls, provide the phone lists for the calls, and pay for the calls?

I mean, if the FCC is going to go after Democratic Dialing, then why not cite AT&T for connecting the calls, and Dell for building servers that originate the calls? By citing Democratic Dialing, the FCC is essentially throwing it's hands in the air and saying we don't want to police the candidates, so we'll make Democratic Dialing be the policeman.

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