FTC Halts Operations for Illegal Robocalls

Four settlement orders focus on violations of Federal Trade Commission Act, telemarketing rules and Do Not Call restrictions. The orders reflect the need for enforcement against bad actors and continued focus on how legitimate businesses’ use this technology to reach consumers legally and effectively.

3/26/2019 1:00 PM

News
FTC Halts Operations for Illegal Robocalls

Companies offering auto warranties, debt relief services, home security systems and impersonating charitable organizations, among others, reportedly made billions of unwanted and illegal robocalls to consumers, according to a news release from the FTC.

“The settlements are part of the agency’s ongoing efforts to combat the scourge of illegal robocalls,” it states. “Under the court orders announced today, the defendants are banned from robocalling and most telemarketing activities, including those using an automatic dialer, and will pay significant financial judgments. The defendant in one of these cases provided the software platform that resulted in more than one billion illegal robocalls.”

The parties involved have agreed to settle Federal Trade Commission charges that they violated the FTC Act and the agency’s Telemarketing Sales Rule (TSR), including its Do Not Call (DNC) provisions.

 “We have brought dozens of cases targeting illegal robocalls, and fighting unwanted calls remains one of our highest priorities,” Andrew Smith, director of the FTC's Bureau of Consumer Protection,” said in the news release.

ACA International has consistently expressed the need for consumers to receive calls from businesses using automated technology, such as debt collectors, schools or health care providers, while regulators enforce illegal calls by bad actors and develop preventative measures with phone carriers to stop those calls.

At the same time, ACA International has noted in communications with regulators that “unwanted calls” may also be necessary, and it may be in a consumer’s best interest to have access to a legal informational call with pertinent information even if it’s not something they look forward to receiving.

When there are admissible facts evidencing egregious conduct, ACA International supports law enforcement efforts to target bad actors, stop illegitimate debt collection activity, and safeguard consumer rights by removing known violators from the financial marketplace.  ACA has worked consistently with the FTC and other regulators to help them understand the complex issues that legitimate debt collectors face, and takes pride in its frequent and varied industry compliance educational services and offerings in support of the overwhelming majority of legitimate debt collectors who operate lawfully, take consumer protection seriously and play a unique and much-needed role in our credit-based economy.

However, the increasing attention to regulatory and legislative efforts that often confuse illegal calls with informational calls in Washington, and nationwide, makes it critical for the accounts receivable management industry to make its voice heard about the need to separate legal, legitimate calls from businesses trying to reach consumers and those of bad actors.

ACA International members interested in discussing legislative and regulatory issues such as this with key policymakers, join ACA International’s advocacy staff May 14-16 in Washington, D.C. for the annual Washington Insights Fly-In. Registration is now open!

According to the FTC news release, the settlement orders include:

NetDotSolutions (James Christiano)

In June 2018, the FTC filed a complaint seeking to stop two related operations and their principals who facilitated billions of illegal robocalls to consumers nationwide, pitching everything from auto warranties to home security systems and supposed debt-relief services. According to the complaint, James “Jamie” Christiano and the companies he controls operate “TelWeb,” a computer-based telephone dialing platform that can be used to blast out a large volume of telephone calls‒‒especially robocalls‒‒in a short time.

The FTC named two of Christiano’s companies in its complaint. NetDotSolutions, Inc. licensed software to Jones and his clients that allowed them to place illegal autodialed robocalls. TeraMESH Networks, Inc. leased computer server rack space to Jones that enabled him to host, maintain, and update the TelWeb software. The FTC alleged that, through TelWeb, Jones’s operation bombarded consumers with more than one billion illegal robocalls annually.

Based on this alleged conduct, the FTC charged Christiano, NetDotSolutions, and TeraMESH with assisting and facilitating: 1) illegal robocalls; 2) calls to numbers on the DNC Registry; 3) calls with spoofed caller IDs; and 4) abandoned calls, in which TelWeb hung up on consumers who answered.

Higher Goals Marketing

According to the FTC’s complaint, the Higher Goals Marketing defendants used illegal robocalls to contact consumers and pitch fake debt-relief services. The defendants guaranteed they could substantially and permanently lower consumers’ credit card interest rates and would save consumers thousands of dollars in interest payments. The scheme was rarely, if ever, able to deliver the promised results. The complaint also alleged the defendants set up the debt-relief scheme within weeks of a court order shuttering a similar telemarketing operation known as Life Management Services, where several of the defendants had worked.

The final court order announced permanently bans defendants Brandun L. Anderson, Lea A. Brownell, Melissa M. Deese, Gerald D. Starr, Jr., Travis L. Teel, Wayne T. Norris, and Sunshine Freedom Services from telemarketing and debt-relief services. It also imposes a $3.15 million judgment against the defendants, jointly and severally, which will be suspended after they turn over all their available assets.

Veterans of America

Announced in July 2018 as part of the charity scam enforcement sweep “Operation Donate with Honor,” the complaint against Veterans of America (VOA) alleged Travis Deloy Peterson used fake veterans’ charities and illegal robocalls to get people to donate cars, boats, and other things of value, which he then sold for his own benefit.

The scheme used various names, including Veterans of America, Vehicles for Veterans LLC, Saving Our Soldiers, Donate Your Car, Donate That Car LLC, Act of Valor, and Medal of Honor. Peterson allegedly made millions of robocalls asking people to donate automobiles, watercraft, real estate, and timeshares, falsely claiming that their donations would go to veterans’ charities and were tax-deductible. In fact, none of the names used in the robocalls was a real charity with tax-exempt status.

The proposed order settling the Commission’s complaint, permanently bans Peterson from soliciting charitable contributions and prohibits him from making misrepresentations 1) that an entity identified as a potential recipient of funds is a charity; 2) that a charitable contribution is tax-deductible; and 3) any other material fact related to the solicitation of money from consumers.

The order also bans Peterson from robocalling, prohibits him from deceptive and abusive telemarketing, and imposes a $541,032.10 monetary judgment against him, which will be suspended once he provides significant assets, including 88 vehicles, to the FTC. The Commission vote approving the proposed stipulated order was 5-0. The FTC filed the proposed order in the U.S. District Court for the District of Utah.

Pointbreak Media

In May 2018, the FTC alleged that this Florida-based scheme deceived small business owners by falsely claiming to represent Google, falsely threatening businesses with removal from Google search results, falsely claiming that they could associate keywords with these businesses, and falsely promising first-place or first-page placement in Google search results.

The FTC’s complaint alleged the defendants had no relationship with Google yet claimed to be “data service providers” for Google or “authorized Google My Business agencies.” The defendants also barraged consumers with robocalls. The company’s telemarketers falsely told consumers who pressed “one” that they could only avoid removal from Google search results by paying the defendants a one-time fee ranging from $300-$700. Otherwise, they said these businesses would be labeled “permanently closed.”

If you are interested in sharing articles and analysis on legal cases, industry laws and regulations or other relevant topics for possible publication with ACA International, email our Communications Department at comm@acainternational.org.


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

FTC Halts Operations for Illegal Robocalls

Companies offering auto warranties, debt relief services, home security systems and impersonating charitable organizations, among others, reportedly made billions of unwanted and illegal robocalls to consumers, according to a news release from the FTC.

“The settlements are part of the agency’s ongoing efforts to combat the scourge of illegal robocalls,” it states. “Under the court orders announced today, the defendants are banned from robocalling and most telemarketing activities, including those using an automatic dialer, and will pay significant financial judgments. The defendant in one of these cases provided the software platform that resulted in more than one billion illegal robocalls.”

The parties involved have agreed to settle Federal Trade Commission charges that they violated the FTC Act and the agency’s Telemarketing Sales Rule (TSR), including its Do Not Call (DNC) provisions.

 “We have brought dozens of cases targeting illegal robocalls, and fighting unwanted calls remains one of our highest priorities,” Andrew Smith, director of the FTC's Bureau of Consumer Protection,” said in the news release.

ACA International has consistently expressed the need for consumers to receive calls from businesses using automated technology, such as debt collectors, schools or health care providers, while regulators enforce illegal calls by bad actors and develop preventative measures with phone carriers to stop those calls.

At the same time, ACA International has noted in communications with regulators that “unwanted calls” may also be necessary, and it may be in a consumer’s best interest to have access to a legal informational call with pertinent information even if it’s not something they look forward to receiving.

When there are admissible facts evidencing egregious conduct, ACA International supports law enforcement efforts to target bad actors, stop illegitimate debt collection activity, and safeguard consumer rights by removing known violators from the financial marketplace.  ACA has worked consistently with the FTC and other regulators to help them understand the complex issues that legitimate debt collectors face, and takes pride in its frequent and varied industry compliance educational services and offerings in support of the overwhelming majority of legitimate debt collectors who operate lawfully, take consumer protection seriously and play a unique and much-needed role in our credit-based economy.

However, the increasing attention to regulatory and legislative efforts that often confuse illegal calls with informational calls in Washington, and nationwide, makes it critical for the accounts receivable management industry to make its voice heard about the need to separate legal, legitimate calls from businesses trying to reach consumers and those of bad actors.

ACA International members interested in discussing legislative and regulatory issues such as this with key policymakers, join ACA International’s advocacy staff May 14-16 in Washington, D.C. for the annual Washington Insights Fly-In. Registration is now open!

According to the FTC news release, the settlement orders include:

NetDotSolutions (James Christiano)

In June 2018, the FTC filed a complaint seeking to stop two related operations and their principals who facilitated billions of illegal robocalls to consumers nationwide, pitching everything from auto warranties to home security systems and supposed debt-relief services. According to the complaint, James “Jamie” Christiano and the companies he controls operate “TelWeb,” a computer-based telephone dialing platform that can be used to blast out a large volume of telephone calls‒‒especially robocalls‒‒in a short time.

The FTC named two of Christiano’s companies in its complaint. NetDotSolutions, Inc. licensed software to Jones and his clients that allowed them to place illegal autodialed robocalls. TeraMESH Networks, Inc. leased computer server rack space to Jones that enabled him to host, maintain, and update the TelWeb software. The FTC alleged that, through TelWeb, Jones’s operation bombarded consumers with more than one billion illegal robocalls annually.

Based on this alleged conduct, the FTC charged Christiano, NetDotSolutions, and TeraMESH with assisting and facilitating: 1) illegal robocalls; 2) calls to numbers on the DNC Registry; 3) calls with spoofed caller IDs; and 4) abandoned calls, in which TelWeb hung up on consumers who answered.

Higher Goals Marketing

According to the FTC’s complaint, the Higher Goals Marketing defendants used illegal robocalls to contact consumers and pitch fake debt-relief services. The defendants guaranteed they could substantially and permanently lower consumers’ credit card interest rates and would save consumers thousands of dollars in interest payments. The scheme was rarely, if ever, able to deliver the promised results. The complaint also alleged the defendants set up the debt-relief scheme within weeks of a court order shuttering a similar telemarketing operation known as Life Management Services, where several of the defendants had worked.

The final court order announced permanently bans defendants Brandun L. Anderson, Lea A. Brownell, Melissa M. Deese, Gerald D. Starr, Jr., Travis L. Teel, Wayne T. Norris, and Sunshine Freedom Services from telemarketing and debt-relief services. It also imposes a $3.15 million judgment against the defendants, jointly and severally, which will be suspended after they turn over all their available assets.

Veterans of America

Announced in July 2018 as part of the charity scam enforcement sweep “Operation Donate with Honor,” the complaint against Veterans of America (VOA) alleged Travis Deloy Peterson used fake veterans’ charities and illegal robocalls to get people to donate cars, boats, and other things of value, which he then sold for his own benefit.

The scheme used various names, including Veterans of America, Vehicles for Veterans LLC, Saving Our Soldiers, Donate Your Car, Donate That Car LLC, Act of Valor, and Medal of Honor. Peterson allegedly made millions of robocalls asking people to donate automobiles, watercraft, real estate, and timeshares, falsely claiming that their donations would go to veterans’ charities and were tax-deductible. In fact, none of the names used in the robocalls was a real charity with tax-exempt status.

The proposed order settling the Commission’s complaint, permanently bans Peterson from soliciting charitable contributions and prohibits him from making misrepresentations 1) that an entity identified as a potential recipient of funds is a charity; 2) that a charitable contribution is tax-deductible; and 3) any other material fact related to the solicitation of money from consumers.

The order also bans Peterson from robocalling, prohibits him from deceptive and abusive telemarketing, and imposes a $541,032.10 monetary judgment against him, which will be suspended once he provides significant assets, including 88 vehicles, to the FTC. The Commission vote approving the proposed stipulated order was 5-0. The FTC filed the proposed order in the U.S. District Court for the District of Utah.

Pointbreak Media

In May 2018, the FTC alleged that this Florida-based scheme deceived small business owners by falsely claiming to represent Google, falsely threatening businesses with removal from Google search results, falsely claiming that they could associate keywords with these businesses, and falsely promising first-place or first-page placement in Google search results.

The FTC’s complaint alleged the defendants had no relationship with Google yet claimed to be “data service providers” for Google or “authorized Google My Business agencies.” The defendants also barraged consumers with robocalls. The company’s telemarketers falsely told consumers who pressed “one” that they could only avoid removal from Google search results by paying the defendants a one-time fee ranging from $300-$700. Otherwise, they said these businesses would be labeled “permanently closed.”

If you are interested in sharing articles and analysis on legal cases, industry laws and regulations or other relevant topics for possible publication with ACA International, email our Communications Department at comm@acainternational.org.


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

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