4 reasons why the latest FTC robocall cases should matter to your business

March 26, 2019

The FTC just announced developments in the ongoing fight against illegal robocalls. “But my company would never place illegal robocalls,” you say. Glad to hear it, but there are four reasons why reputable businesses should still take note when the FTC brings actions against robocallers.

Reason #1 – Robocallers have small businesses in their sights. Case in point: the FTC’s action against Point Break Media and a host of affiliated companies and individuals. (Just as an aside, it’s a swarm of bees and a murder of crows. But what’s the collective noun for defendants who bombard consumers with illegal recordings? We suggest an exasperation of robocallers.) Last year, the FTC sued the defendants for falsely claiming to represent Google and for telling business owners that Google would list them as “permanently closed” unless they paid a fee. They also upsold services with the bogus promise of first-place or first-page placement in search results.

Eight of the defendants have agreed to settle the charges. Under the proposed settlements, the multimillion dollar judgments will be partially suspended based on their financial condition, and the order bans some defendants for life from certain aspects of telemarketing. One step you can take to protect your company from B2B deception: Get wise to common forms of fraud by reading the FTC’s Scams and Your Small Business.

Reason #2 –The FTC is working to put the brakes on illegal robocallers and the fraudsters who grease the wheels. Taking down complex robocall networks is an exacting process. In some cases, the FTC sues the robocallers themselves. In other actions, the targets are behind-the-scenes big wigs. Last year, the FTC sued James Christiano and two companies he controls – NetDotSolutions and TeraMESH Networks – for operating TelWeb, a robocall dialing platform used to make billions of illegal calls in at least eight other FTC cases.

The FTC announced settlements with all defendants except for a defunct defaulting defendant, World Connection LLC USA. The order against Christiano and his companies imposes a $1.35 million judgment and bans them from engaging in telemarketing using an automatic dialer or helping others do so. To make sure they’ve changed their practices, the order requires them to conduct reviews of current and prospective clients and terminate their relationship with any entity that engages in telemarketing through the use of an automatic dialer. The order against defendant Andrew Salisbury bans him from making robocalls or assisting others. The $2.7 million financial remedy will be partially suspended upon payment of $50,000.

Reason #3 – Nobody likes a copycat. According to an FTC lawsuit, Higher Goals Marketing and related affiliates used illegal robocalls to pitch phony debt-relief services. Their big-time savings claims were almost always a bust, so cash-strapped consumers found themselves in a deeper financial hole. The FTC says some of the defendants set up the operation just weeks after a court had – at the request of the FTC and Florida AG – shut down a similar telemarketing scheme known as Life Management Services, where several of the defendants had worked.

The proposed settlements ban the defendants from most forms of telemarketing. The orders also impose a $3.15 million judgment for which the defendants are jointly and severally liable. The financial remedy will be suspended after they turn over virtually all of their assets. The free (but we think priceless) lesson of the case is that when your fraudulent operation has been shut down by a federal court, consider a new (and lawful) line of work.

Reason #4 – You’re a consumer, too. At the end of your work day, the FTC remains committed to challenging illegal practices that affect you, your family, and your community. One example is Operation Donate with Honor, an FTC, state, and local enforcement sweep targeting outfits that falsely claimed to help veterans.

The FTC just announced a proposed settlement with Travis Deloy Peterson, who used robocalls to ask people to donate cars, boats, real estate, etc., to purported “charities” with names like Veterans of America, Vehicles for Veterans, Saving Our Soldiers, Act of Valor, and Medal of Honor. In fact, Peterson sold the donated items and pocketed the cash. The settlement bans Peterson for life from soliciting charitable contributions or engaging in robocalls. Given his financial condition, the $541,032 judgment will be partially suspended after he turns over money held in 10 bank accounts, the 16 servers he used to blast out robocalls, and 88 donated vehicles.

The case offers two takeaways for reputable businesses. First, investigate before you contribute and before you lend your services to companies claiming to be charities. Research charities using the IRS’s public database of tax-exempt organizations and through independent groups that specialize in scrutinizing the track records of charities. Second, don’t lend your company’s good name to just anybody who claims to have a cause. Read Tips for Retailers: How to Review Charity Requests for more information about helping your contributions go to the deserving – and not to the dishonest.
 
 

Comments

These calls infringe on my time, promote scams, attempt to defraude and ignore the Do Not Call list. They need to be stopped!

How can their financial condition always be so dismal after stealing millions????? They are hiding the money and FTC and the court is letting them. FIND THIS MONEY!!!! CRIME CANNOT MUST. NOT PAY!!!!!

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