Newspaper article The Record (Bergen County, NJ)

Robocall Probes Taking Time but Spurring Penalties

Newspaper article The Record (Bergen County, NJ)

Robocall Probes Taking Time but Spurring Penalties

Article excerpt

The wheels of justice often turn slowly. But, like the tortoise in his race with the hare, they often get successfully to their destination.

That's what we saw in the recent record-setting $30 million penalty a telemarketer was assessed in a case that took three years to settle.

Last week, in a suit brought by the Federal Trade Commission, a federal judge in Rochester, N.Y., ordered defendants behind a deceptive robocall scheme to pay $30 million in civil penalties and give up more than $1.1 million in ill-gotten gains for violations of federal telemarketing sales rules.

The penalty was, by far, the largest ever imposed for unlawful calls to consumers on the do-not-call registry, the FTC said.

That court order came five days after the agency put another robocall operation out of the telemarketing business under a settlement to resolve 2-year-old charges. That company allegedly bombarded consumers with more than 2 billion calls -- including some from the infamous Rachel of Cardholder Services -- pitching a variety of products and services, including worthless extended auto warranties and credit card interest rate-reduction programs.

Unfortunately, those calls from "Rachel" do not appear to be connected with the recent surge of calls from her that have generated numerous consumer complaints.

But the FTC is well aware of the second wave of Rachel calls, so it should be only a matter of time before her backers face court sanctions. Just don't expect anything to happen quickly, because these cases, with calls routed offshore, can be incredibly complex.

In the most recent suit, Paul Navestad and Christine Maspkorn, operating primarily as the "Cash Grant Institute," allegedly made more than 8 million robocalls to consumers, including more than 2.7 million to numbers on the do-not-call registry.

The calls falsely claimed that cash grants for consumers were readily available from federal, state and local governments, private foundations and "wealthy individuals." They also promised consumers that they had already qualified for grants, and could receive up to $25,000 to over-come personal financial problems.

The robocalls directed consumers to one of the defendants' websites that repeated many of the same claims about the availability of "Free Grant Money. …

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