Consumer Confidential: Telemarketing calls on rise despite do-not-call list

THE LOS ANGELES TIMESAugust 13, 2013 

MCT ILLUSTRATION

Dan Yeh has been on the federal government’s Do Not Call Registry for years. And for a while, it seemed like the leave-me-alone system worked just fine.

Not anymore.

“There’s been a real surge recently,” Yeh, 72, told me. “I’ve been getting five or six calls a day, at all hours, seven days a week.”

The Huntington Beach, Calif., resident isn’t alone. I’ve heard similar complaints from dozens of other people.

Regardless of having registered a phone line with the Federal Trade Commission as a telemarketer-free zone, a growing number of consumers are saying that some businesses are ignoring their stated preference and calling anyway.

A particular annoyance: automated robocalls that get you on the line before looping in a human telemarketer. Such calls frequently use “spoofed” lines that hide their origin or make it look as if the call is from someone you know.

“I’ve given up answering the land line,” said Rory Johnston, 67, of Los Angeles. “They’re nearly all robocalls.”

It’s not people’s imagination that telemarketers are stepping up their game.

“We’re definitely seeing an uptick in consumer complaints,” acknowledged Lois Greisman, associate director of the FTC’s division of marketing practices, which oversees enforcement of the do-not-call list.

In 2011, she said, the agency received about 2.6 million complaints about do-not-call violations. Last year, that number jumped 54 percent to almost 4 million.

“This isn’t the Fortune 500 calling you,” Greisman said. “These are fraudsters, and they were never going to comply with the do-not-call list.”

But why the recent increase in robocalls and telemarketing?

Greisman blamed it on technological advances that make such calls easier and cheaper, including auto-dialers that can generate thousands of calls a minute. She also cited technical tricks such as spoofing that help marketers hide their identity and get around people’s caller-ID defenses.

Simply put, federal officials had no idea that scammers and marketers would become so sophisticated when the do-not-call list was established 10 years ago.

“The telecom system looked very different back then,” Greisman said.

At that time, telemarketers sued the FTC over what they said were violations of their free-speech rights. A federal appeals court saw things otherwise, ruling that the do-not-call list “advances the government’s important interests in safeguarding personal privacy and reducing the danger of telemarketing abuse.”

Since then, the FTC has gone after about 530 individuals and businesses for bothering consumers who didn’t want to be bothered. That translates to roughly 50 a year — not the most spectacular enforcement record, considering that 221 million phone numbers are registered on the do-not-call list.

The FTC in June announced its biggest catch to date: Mortgage Investors Corp., a Florida home-refinancing company, agreed to pay a record $7.5 million fine for having made more than 5.4 million calls to people on the do-not-call list.

But Greisman acknowledged that completely ending robocalls and do-not-call-list violations is about as likely as preventing spam from spilling into people’s email in-boxes.

“You can never stop anything 100 percent,” she said. “But the problem of spam has been substantially minimized by filtering technology. I’m hopeful that the same can happen with robocalls.”

The FTC offered a $50,000 prize last year to whoever came up with the best idea for thwarting robocalls. Nearly 800 people offered suggestions, many of which, I’m guessing, involved assorted acts of violence.

The contest ended in a tie. Serdar Danis and Aaron Foss each received $25,000 for software intended to spot and block offending calls before they reach people’s homes.

Does that mean we’ll see anything like this put into operation soon? Probably not.

The FTC says it’s not endorsing any particular solution. It awarded the prizes just to highlight the fact that potential remedies are out there and to encourage phone companies to do the rest, such as filtering out unwanted calls.

“The carriers could do more,” Greisman said.

But there’s the rub. Cracking down on telemarketers basically means phone companies would be cutting back on business from some of their more active customers, albeit really annoying ones. And phone companies have never been particularly eager to do anything that reduces revenue.

They’ve also discovered that the problem of telemarketing represents a lucrative business opportunity.

In California, Verizon charges $2.50 a month to block calls from anonymous numbers, although this won’t stop spoofed numbers. The company also charges $4 a month to block calls from up to a dozen local numbers, but this will still allow “800” numbers to get through.

AT&T charges $7.50 a month for each of the same services, though the company says some customers may have them included in their calling plans.

For the time being, it looks as if consumers’ best bet is the FTC’s ongoing game of Whac-A-Mole with telemarketers.

Agency officials advise consumers to hang up as soon as an unwanted marketing call arrives. Don’t press any numbers if prompted to do so, because this will alert the marketer’s computers that an active phone line has been found.

And even though it may seem pointless, Greisman encouraged consumers to always report unwanted marketing calls to the FTC.

“We’ll find who’s making them,” she pledged. “It’s hard, but it’s not impossible.”

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david.lazarus@latimes.com

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