The Department of Justice for the first time has filed a civil complaint to try to stop telecom companies from knowingly abetting fraudulent robocalls, all of which calls were made over the internet. It is looking to end hundreds of scam millions of robocalls per month costing consumers hundreds of millions of dollars.
The Department has filed two civil actions asking a court to prevent what they call is the wire fraud being committed by VoIP providers. The first defendant is Ecommerce National LLC d/b/a TollFreeDeals.com; SIP Retail d/b/a sipretail.com; and owner/operators, Nicholas Palumbo, 38, and Natasha Palumbo, 33, of Scottsdale, Arizona. The second case involves Global Voicecom Inc., Global Telecommunication Services Inc., KAT Telecom Inc., aka IP Dish, and owner/operator, Jon Kahen, 45, of Great Neck, New York.
Separately, a federal court has already entered a temporary restraining order against the Global Voicecom defendants.
Justice called the VoIP providers "gateway carriers" for hundreds of millions of scam calls, and warned other telecoms that if they knowingly facilitate such scam calls, it will go after them as well.
There was no FCC involvement in the DOJ press conference announcing the crackdown. Asked about that absence, given that the FCC has made a big push to crack down on scam robocalls, a DOJ official said that while the FCC has been a good partner with Justice on a range of elder fraud issues, it was a "fast acting" matter that it was able handle with the help of the Social Security Administration and Postal Service, but that it had not worked specifically with the FCC
The calls they facilitated came mostly from India and cost U.S. residents hundreds of millions of dollars, said Justice, appearing to be coming from government agencies like the IRS and immigration services, and threatening deportation, freezing of assets, and other consequences if consumers didn't pony up the money, which many did, including seniors.
Assistant Attorney General Jody Hunt of the Civil Division said that if they obtain the court relief--a temporary restraining order--the behavior will be enjoined, but that there is as yet no criminal complaint.
Hunt would not speculate on what might happen to the individuals involved, but Justice would seek to recover lost funds or restitution. "We're not taking anything off the table," in terms of further action, Justice said, but added that the civil actions were the fastest way to try and stop the calls.
DOJ said the telecom industry in general has been a helpful partner in trying to stop such schemes, and that one of the reasons that they are conifdent the defendents knew the calls were scams was that AT&T and USTelecom took substantial meaasures to try and call out the schemes to put these entities on notice. It also said they had been warned by law enforcement.
Justice said using VoIP made it easy for the companies to facilitate the scam calls, and to carry a "substantial" number of calls, which appears to be a substantial part of their businesses.