The Challenge
The use of telemarketing to consumers’ cell phones has increased dramatically over the past few years. As a result, consumers have filed more complaints about these unwanted calls. Some of these calls use fraudulent and deceptive tactics to scare or mislead consumers. In order to save money on call center personnel, some companies use recorded messages, which make it difficult for the consumer to tell them to stop calling. Consumers have complained to lawmakers and phone companies to eliminate these calls. Both have responded by increasing regulations and technologies to address the problem.
As a result, companies are experiencing difficulty reaching consumers who have expressed a genuine interest in their services by filling out an online form or calling. It is challenging for legitimate companies to navigate the complex web of state, federal, carrier, and handset guidelines, along with court cases defining the way regulations are interpreted. Despite following all the correct rules and processes, many marketers have seen their contact rates drop since phone calls are blocked at the carrier or individual phone level.
Regulatory Environment
The Federal Government:
For many years the telemarketing industry has been regulated by the FTC’s Telemarketing Sales Rule (“TSR”) and the FCC’s Telephone Consumer Protection Act (“TCPA”). Both of these verbose regulations created ground rules to protect consumers from unwanted solicitations and to prevent runaway charges on the consumer’s phone bill. Recent advances in technology have enabled bad actors to reach consumers through spoofing numbers and prerecorded voices, introducing us to the “robocall”.
To address this, the TPCA has been updated by the FCC to enforce key elements of the TSR with legal remedies. The consolidated regulations impose stiff penalties and include personal liability for the officers at the calling companies. The FCC additionally worked with the industry and implemented STIR/SHAKEN as a required carrier framework to authenticate the origination point for each call so that unauthenticated calls could be marked as spam or blocked. In parallel, Congress passed the Telephone Robocall Abuse Criminal Enforcement and Deterrence (“TRACED”) Act which adds additional penalties for offenders along with requirements for telephone carriers to monitor and block illegal traffic on their networks.
In the above acts, the regulatory scope is broad-based and sometimes mismatched to address the modern robocall issues, and definitions are often vague which allows individual plaintiffs and class actions to easily include good players in complex litigation with the risk of enormous penalties.
The States:
Legislators in individual states have clearly heard the onslaught of robocall complaints from their constituents, along with related concerns about consumer data protection. Laws have been proposed and accepted in a number of states that clarify and/or obscure federal regulations for solicited and unsolicited calls to residents within those respective states. The newer laws extend prior state telemarketing laws which regulated times of day, days of the week, and days of the year that calls can legally be made to their residents.
As if this is not hard-enough to navigate, individual states have also enacted specific restrictions on calling with a pre-recorded voice, leaving pre-recorded voicemails, leaving ringless voicemails, using an artificial voice, using a CallerID within the state, having specific opt out requirements, and requiring certain statements be made within the first few seconds of an answered call.
In most cases, state regulations enable litigation and penalties in state court.
The Carriers:
The TRACED Act now holds telephone carriers accountable to monitor traffic on their networks and to have them actively block illegal traffic from robocallers. Prior to this regulation, the major carriers were utilizing 3rd party analytics firms to determine and mark calls as suspect for the carriers. The carriers have partnered with the major handset providers to allow the display of labels such as “Spam Likely”, “Suspected Fraud” and similar labels specified by the carriers.
The carriers’ analytics companies are evaluating raw carrier traffic logs and crowdsourced consumer reporting to statistically determine if a particular call or calling source is good or bad. These algorithms are constantly monitored and are altered to try to isolate bad traffic from good traffic. As a result, these algorithms are never perfect, resulting in incorrectly marked or blocked calls. Once a specific CallerID has been correctly or incorrectly identified as a bad caller, the process to reinstate a good status is complicated, at best.
SMS communications have also been affected by these carrier actions. It is mandatory for companies that use automated methods to send communications to consumers to have their messages pre-approved or they will be subject to financial penalties and/or blocking by carriers.
On Phones:
Some of the same analytic companies that service the carriers also offer consumer software applications that can be downloaded and configured to mark or block unwanted calls. If the carrier has not blocked a call, these applications can override the carrier’s display and also block calls that would otherwise not be blocked. Some carriers have endorsed some of these apps and others have introduced competitive apps that attempt to provide the same type of service offering for free or as a premium subscription service.
Many Android and Samsung smartphones come with this level of software capabilities pre-installed. Google Phone uses Google’s call analytics by default to evaluate each call. Similarly, Samsung users can flip a setting for call filtering on their phones. Although Apple has yet to incorporate a utility into their standard portfolio, it seems likely that they will do so in the future.
What To Do
We advise our clients, who all have legitimate calls to make, to:
- Make sure you have proper and documented consent to call each consumer
- Understand, at least at a high level, the regulatory and enforcement environment as described above
- Evaluate how their call strategies and technology solutions may elevate or reduce regulatory, carrier and software-blocking risk
- Determine how on-going campaigns can be monitored for success and risk management
- Identify how to address mis-labeled or blocked call attempts with carriers, analytic companies and software providers
What We Do
At Balboa Digital, we have selfishly navigated through the tangled regulatory and enforcement environments on behalf of our clients. When calls we place on our clients’ behalf are connected to the right person and handled professionally, we all win.
Over the years, we have enhanced our calling systems to enforce the regulations and requirements that have emerged at the federal and state levels. We have additionally established direct relationships with the carriers’ analytic and software companies to have our calls “whitelisted” to avoid spam labeling or blocking. And, we display our clients’ name, logo and reason for calling on devices and networks that support this capability.
We work with each client to configure our calling strategy to minimize regulatory concerns and to maximize successful calling. Regular, detailed reporting is provided which tracks KPIs and any identified issues or opportunities. We have happy clients who will gladly share their success stories with you!
