In a collective effort to combat the rampant issue of scam calls, the Federal Trade Commission (FTC) joined forces with the Federal Communications Commission (FCC), state attorneys general, and various state and federal agencies to announce “Operation Stop Scam Calls” on July 18. This initiative brought together 102 participants, resulting in a total of 180 enforcement actions taken at the state and federal levels.
Among the notable announcements were five specific enforcement actions brought forward by the FTC against the following companies: Fluent, LLC, Viceroy Media Solutions, LLC, Yodel Technologies, LLC, Solar Xchange LLC, and Hello Hello Miami, LLC.
Sam Levine, the Director of the FTC’s Bureau of Consumer Protection, stressed two significant takeaways from the actions undertaken during Operation Stop Scam Calls. Firstly, the FTC is determined to pursue enforcement against companies engaged in third-party lead generation. Levine condemned the use of “consent farms,” where organizations obtain personal details and “phony consent” from consumers to sell to unscrupulous telemarketers. He clarified that all lead generation by third parties is considered illegal under the FTC’s Telemarketing Sales Rule, emphasizing that consent for robocalls must be directly collected from consumers.
As part of its commitment to addressing consent farms and third-party lead generation, the FTC filed a proposed order demanding Fluent to pay a $2.5 million penalty and prohibiting the company from engaging in or facilitating robocalls. The FTC alleged that Fluent acted as a consent farm lead generator, amassing over 620 million telemarketing leads from January 2018 to December 2019.
Secondly, Levine highlighted that calls using soundboard technology are considered robocalls, subject to FTC enforcement. Soundboard technology allows call agents or AI to play prerecorded responses during calls, disguising the lack of a live agent. The FCC previously confirmed that soundboard technology is considered artificial or prerecorded voice, necessitating prior express consent from the called party. As a result, the FTC filed a complaint against Yodel Technologies and its owner, Rober Pulsipher, for allegedly initiating more than 1.4 billion calls to U.S. consumers between January 2018 and May 2021 using soundboard technology. The proposed order imposed a $1 million civil penalty and a ban from telemarketing activities.
During the announcement of Operation Stop Scam Calls, key figures from the U.S. Department of Justice, the FCC, and state AG offices underscored the importance of collective action in combatting illegal calls. They emphasized the need for service providers to implement Know Your Customer (KYC) principles and practices, cooperate with law enforcement, and actively block illegal calls.
As the FTC continues its crackdown on scam calls, Director Sam Levine issued a warning to all businesses: “Take steps to keep illegal calls out of the country, or the next call you get might be from the FTC.”