[Senate Hearing 113-117]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 113-117

                  STOPPING FRAUDULENT ROBOCALL SCAMS: 
                           CAN MORE BE DONE?

=======================================================================

                                HEARING

                               before the

   SUBCOMMITTEE ON CONSUMER PROTECTION, PRODUCT SAFETY, AND INSURANCE

                                 of the

                         COMMITTEE ON COMMERCE,
                      SCIENCE, AND TRANSPORTATION
                          UNITED STATES SENATE

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             JULY 10, 2013

                               __________

    Printed for the use of the Committee on Commerce, Science, and 
                             Transportation





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       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

            JOHN D. ROCKEFELLER IV, West Virginia, Chairman
BARBARA BOXER, California            JOHN THUNE, South Dakota, Ranking
BILL NELSON, Florida                 ROGER F. WICKER, Mississippi
MARIA CANTWELL, Washington           ROY BLUNT, Missouri
MARK PRYOR, Arkansas                 MARCO RUBIO, Florida
CLAIRE McCASKILL, Missouri           KELLY AYOTTE, New Hampshire
AMY KLOBUCHAR, Minnesota             DEAN HELLER, Nevada
MARK WARNER, Virginia                DAN COATS, Indiana
MARK BEGICH, Alaska                  TIM SCOTT, South Carolina
RICHARD BLUMENTHAL, Connecticut      TED CRUZ, Texas
BRIAN SCHATZ, Hawaii                 DEB FISCHER, Nebraska
WILLIAM COWAN, Massachusetts         RON JOHNSON, Wisconsin
MARTIN HEINRICH, New Mexico          JEFF CHIESA, New Jersey
                    Ellen L. Doneski, Staff Director
                   James Reid, Deputy Staff Director
                     John Williams, General Counsel
              David Schwietert, Republican Staff Director
              Nick Rossi, Republican Deputy Staff Director
   Rebecca Seidel, Republican General Counsel and Chief Investigator
                                 ------                                

         SUBCOMMITTEE ON CONSUMER PROTECTION, PRODUCT SAFETY, 
                             AND INSURANCE

CLAIRE McCASKILL, Missouri,          DEAN HELLER, Nevada, Ranking 
    Chairman                             Member
BARBARA BOXER, California            ROY BLUNT, Missouri
MARK PRYOR, Arkansas                 KELLY AYOTTE, New Hampshire
AMY KLOBUCHAR, Minnesota             DAN COATS, Indiana
RICHARD BLUMENTHAL, Connecticut      TED CRUZ, Texas
BRIAN SCHATZ, Hawaii                 DEB FISCHER, Nebraska
WILLIAM COWAN, Massachusetts










                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on July 10, 2013....................................     1
Statement of Senator McCaskill...................................     1
Statement of Senator Heller......................................     3
Statement of Senator Pryor.......................................    38

                               Witnesses

Lois Greisman, Associate Director, Division of Marketing 
  Practices, Bureau of Consumer Protection, Federal Trade 
  Commission.....................................................     4
    Prepared statement...........................................     6
Eric J. Bash, Associate Chief, Enforcement Bureau, Federal 
  Communications Commission......................................    18
    Prepared statement...........................................    20
Kevin Rupy, Senior Director, Law and Policy, United States 
  Telecom Association............................................    32
    Prepared statement...........................................    33
Michael F. Altschul, Senior Vice President and General Counsel, 
  CTIA--The Wireless Association................................    38
    Prepared statement...........................................    40
Matthew Stein, Chief Technology Officer, Primus 
  Telecommunications Inc.........................................    43
    Prepared statement...........................................    45
Aaron Foss, Freelance Software Developer, Nomorobo...............    46
    Prepared statement...........................................    48

                                Appendix

Response to written questions submitted to Lois Greisman by:
    Hon. Claire McCaskill........................................    61
    Hon. Amy Klobuchar...........................................    63
    Hon. Mark Warner.............................................    64
    Hon. Dan Coats...............................................    66
Response to written questions submitted to Eric J. Bash by:
    Hon. Claire McCaskill........................................    66
    Hon. Amy Klobuchar...........................................    68
    Hon. Mark Warner.............................................    68
    Hon. Dan Coats...............................................    70
Response to written questions submitted to Kevin G. Rupy by:
    Hon. Claire McCaskill........................................    70
    Hon. Mark Warner.............................................    75
    Hon. Dan Coats...............................................    77
Response to written questions submitted to Michael F. Altschul 
  by:
    Hon. Claire McCaskill........................................    77
    Hon. Mark Warner.............................................    77
    Hon. Dan Coats...............................................    79
Response to written questions submitted to Matthew Stein by:
    Hon. Mark Warner.............................................    79
    Hon. Dan Coats...............................................    82
Response to written questions submitted to Aaron Foss by:
    Hon. Mark Warner.............................................    82
    Hon. Dan Coats...............................................    84

 
         STOPPING FRAUDULENT ROBOCALL SCAMS: CAN MORE BE DONE?

                              ----------                              


                        WEDNESDAY, JULY 10, 2013

                               U.S. Senate,
      Subcommittee on Consumer Protection, Product 
                             Safety, and Insurance,
        Committee on Commerce, Science, and Transportation,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 10 a.m. in 
room SR-253, Russell Senate Office Building, Hon. Claire 
McCaskill, presiding.

          OPENING STATEMENT OF HON. CLAIRE McCASKILL, 
                   U.S. SENATOR FROM MISSOURI

    Senator McCaskill. Welcome, everyone. This hearing will 
come to order. We appreciate you being here.
    We have all been subject to the frustrations and annoyances 
of receiving unwanted telemarketing calls, also known as 
robocalls. It seems these calls always intrude at a very 
inconvenient time.
    Ten years ago, the Federal Trade Commission and the Federal 
Communications Commission, at the direction of Congress, 
established a National Do Not Call Registry so that consumers 
could get some peace and quiet in their homes and stop the 
torrent of unsolicited telemarketing calls. The idea was 
simple: voluntarily register your phone number on a centralized 
list, and telemarketers would be prohibited by law from calling 
you. The registry has been celebrated across party lines as a 
successful government program that provides real benefits to 
consumers.
    While the National Do Not Call Registry has been effective 
at limiting intrusions by legitimate telemarketers, fraudulent 
robocalls have since filled the void and have become the source 
of understandable anger and frustration among the public. These 
automated, prerecorded telemarketing calls that often seek 
personal information from unsuspecting consumers are an 
annoyance at best, but they can be devastating for those that 
are defrauded by them.
    It is easy to see how consumers can easily be confused by 
these calls. One common scam involves a call from Rachel from 
``Cardholder Services'' offering an easy way to reduce 
consumers' credit card interest rates.
    [Audio played.]
    Senator McCaskill. Another common scam involves robocalls 
warning consumers that their auto warranty is about to expire.
    [Audio played.]
    Senator McCaskill. In both examples, with the press of a 
button, the consumer is directed to an individual whose job is 
to collect financial information in an effort to defraud them. 
Even pressing the button they claim removes a caller from their 
list does nothing more than identify a phone number as valid, 
likely increasing the frequency of unwanted calls in the 
future.
    Law enforcement officials have estimated that telemarketing 
fraud costs Americans over $40 billion annually. So it is no 
wonder that robocalls consistently remain a top consumer 
complaint at the FTC as well as the FCC. The FTC alone receives 
more than 200,000 complaints about robocalls every month. 
Complaints received from consumers in the state of Missouri 
alone have roughly doubled every year since 2009.
    The FTC and FCC have taken important steps to try and stop 
fraudulent robocalls. Both commissions have issued rules 
restricting robocalls, and they have taken enforcement actions 
to protect consumers.
    Since the National Do Not Call Registry started, the FTC 
has won more than $250 million in civil penalties and equitable 
relief for consumers against robocalls. But because these shady 
companies and individuals are often based overseas and very 
difficult to locate, the FTC has only been able to collect $15 
million out of the $250 million that they have in fact gotten 
authorization to collect.
    Today we will hear from the FTC and the FCC about their 
efforts to implement the National Do Not Call Registry and 
other telemarketing rules. We will hear about their successes 
and their challenges in pursuing fraudulent robocalls, as well 
as their suggestions for how we can stem the tide of the 
alarming number of robocalls being placed to Americans every 
day.
    Advances in technology have made it cheap and easy for an 
individual anywhere in the world with a computer and a 
broadband connection to make thousands and even millions of 
robocalls at the push of a button.
    Last year, recognizing the limits of regulation and law 
enforcement in stopping these kinds of calls, the FTC launched 
a public competition asking American innovators to put forth 
their best ideas for a technological solution that would weed 
out fraudulent robocalls. In April, the FTC announced its 
winners.
    Among the three winners of the FTC challenge was Nomorobo, 
a technology that would screen out fraudulent callers in much 
the same way that a spam filter screens out unwanted e-mails. 
We will hear from that product's developer about his innovative 
idea and what it would take to make it or something like it a 
viable tool for every American consumer.
    It would seem the technological and legal barriers to a 
technological solution are not insurmountable. Primus, a 
Canadian telecommunications provider, offers its customers a 
free ``Telemarketing Guard'' that similarly screens out 
fraudulent callers. We will hear from its inventor and chief 
technology officer about its service.
    We will also hear from our domestic wireline and wireless 
telephone service industries, represented here by the United 
States Telecom Association and CTIA--The Wireless Association, 
about the steps the industry has taken, is taking, and could 
take in the future to help address the consumer harm from 
fraudulent robocalls.
    Ten years of the National Do Not Call Registry, by all 
accounts, has accomplished precisely what Congress and the FTC 
intended. However, fraudulent robocalls and advancing 
technology has allowed scammers looking to make a quick buck 
with no regard for the law--they remain a serious annoyance and 
abuse that faces consumers.
    Similarly, the exceptions to the Do Not Call Registry for 
charities, political calls, and businesses with which consumers 
have an existing relationship also remain a nuisance for 
consumers. In exploring regulatory, statutory, or technological 
changes to address the problem of robocalls, giving the 
consumers the choice to stop all unwanted calls--charities, 
political, and businesses with existing relationships to the 
consumer--stopping all of those calls, regardless of who places 
them, should be our ultimate goal. The choice here should rest 
firmly in the hands of the phone that rings.
    And I will turn it over now to Senator Heller.

                STATEMENT OF HON. DEAN HELLER, 
                    U.S. SENATOR FROM NEVADA

    Senator Heller. Thank you. And good morning. Chairman 
McCaskill, thanks for holding this hearing.
    And I want to thank our witnesses for being here and those 
in the audience also that are interested in what I think is a 
very important hearing. And having your participation is 
important in moving this forward.
    Congress has been looking for ways to limit unsolicited 
telephone calls since 1991 when the Telephone Consumer 
Protection Act was passed. In 1994, Congress acted again when 
the Telemarketing Consumer Fraud and Abuse Prevention Act was 
signed into law. These laws gave the FCC and the FTC 
commissions the authority to enact regulations on telephone 
solicitations and the use of automated telephone equipment to 
make these solicitations.
    These laws clearly prohibited any telemarketer from 
initiating or any seller from causing a telemarketer to 
initiate an outbound telephone call to a person when that 
person previously had stated that he or she does not wish to 
receive a call. So there shouldn't be any confusion as to the 
intent of Congress when these bills were passed. People have a 
right to free themselves from telephone solicitations.
    As we come up on the 10th year anniversary of the National 
Do Not Call Registry, I think it is important to note this has 
been, to a degree, a successful government program. The FTC and 
the FCC deserve credit for promoting this program and ensuring 
that it functions correctly.
    Solicitors for the most part have honored the wishes of 
consumers, and when a solicitor has broken the rules, the FTC 
and/or the FCC have acted appropriately. In fact, on June 27, 
2013, the FTC announced a $7.5 million civil penalty for 
violations by a refinancer of veterans' home loans, which, 
according to the FTC, is the largest fine that has ever been 
collected.
    Despite the popularity of the Do Not Call Registry and the 
actions of the FTC and the FCC, there has been a noticeable 
rise in the number of illegal robocalls over the last several 
years. Between October 2008 and September 2009, the FTC 
received over 700,000 complaints involving calls using a 
recorded message. Between October 2011 and September 2012, 
these complaints increased over 2 million.
    The FTC and the FCC are actively engaged in stopping these 
illegal robocalls, but they have admitted to the significant 
challenges they face against new and emerging technologies, 
including sophisticated Voice-over-Internet-Protocol enabled 
auto-dialers and the use of fake caller ID systems.
    Companies using auto-dialers can send out thousands of 
phone calls every minute at almost no cost. Some of these 
companies do not screen against the Do Not Call Registry and 
use this solicitation to scam an individual.
    I have here with me a recent article in USA Today that 
outlined an example of this type of scam. In fact, it came out 
this month, on July 4, and it is called ``Your Money: Seniors 
Fight Back Against Robocalls.'' And it gave a specific example 
of what is happening out there, and I would like to take a 
couple of paragraphs, if I may.

        ``The automated voice implies that a doctor or a 
        relative signed the consumer up for a medical alert 
        system, and it is all free. Authorities said that, in 
        some cases, after consumers press a button to accept 
        the offer, they quickly receive another call asking for 
        personal information, including credit card numbers. 
        This might be con artists trying to get bank or credit 
        card information or a Social Security number to use in 
        ID theft, or it is a way to pressure seniors into 
        paying for equipment or services that they don't need. 
        The medical alert system scam is in full swing in 
        Michigan, according to the state attorney general's 
        office, as well as in other states, including 
        Pennsylvania, New York, Texas, Wisconsin, and 
        Kentucky.''

    Today's hearing is an opportunity for the Senate to hear 
more about the actions of the FCC and the FTC, what they are 
taking, as well as from the private sector on what technologies 
are available to help consumers free themselves from unwanted 
telephone solicitations.
    I am looking forward to the testimonies of our panelists 
and again thank the Chairman for calling this important 
hearing.
    Senator McCaskill. Thank you very much.
    We will now hear from our witnesses. And we have two 
witnesses on our first panel. The first panel is Lois 
Greisman--we are happy to have you here--and Eric Bash, from 
the FCC and the FTC.
    And we are happy to have both of you, and we look forward 
to your testimony.
    Ms. Greisman?

        STATEMENT OF LOIS GREISMAN, ASSOCIATE DIRECTOR,

           DIVISION OF MARKETING PRACTICES, BUREAU OF

         CONSUMER PROTECTION, FEDERAL TRADE COMMISSION

    Ms. Greisman. Thank you. And good morning, Chairman 
McCaskill, Ranking Member Heller. I am delighted to appear 
before you this morning to discuss the FTC's work to fight 
illegal robocalls. And we are very much appreciative of your 
leadership in the consumer protection area.
    I am also pleased to be sitting next to my friend and 
former colleague, Eric Bash. Both he and the FCC have been 
outstanding partners in our fight against telemarketing fraud.
    As you noted, by establishing the Do Not Call Registry 10 
years ago, the Federal Trade Commission gave consumers an easy-
to-use tool to protect their privacy against unwanted calls. I 
believe, as you indicated, that the do-not-call program has 
been highly effective in reducing unwanted calls from 
legitimate telemarketers. Enforcing the do-not-call provisions 
is a top priority for the agency, and the more than 100 cases 
filed by the FTC reflect that priority.
    But several years ago, we observed a troubling shift in the 
landscape: robocalls. And I want to talk briefly about what 
gave rise to the new problem and how we are marshalling all of 
our resources to tackle illegal robocalls and to protect 
consumers.
    Technological changes in communication services have 
brought enormous benefits to consumers by way of lower costs 
and improved services. At the same time, however, fraudsters 
have also taken advantage of these lower costs, which brought 
faster and cheaper automated-dialing platforms. Fraudsters have 
also further exploited caller ID spoofing, which induces the 
consumer to pick up the phone, while at the same time enabling 
the scammer to hide its identity and location. And, of course, 
with phone calls bouncing from country to country all over the 
world, it is now easier than ever for the robocaller to hide.
    With such a cheap and scalable business model, bad actors 
can blast literally tens of millions of illegal robocalls over 
the course of a single day at less than 1 cent per minute. 
These robocalls not only invade consumers' privacy, quite often 
they pitch goods and services riddled with fraud.
    To meet this challenge, we stepped up our law enforcement 
initiatives. Looking just at the cases we have completed 
involving robocalls, we have shut down entities that placed 
billions of such calls and we have obtained court orders 
totaling more than $200 million in redress or disgorgement and 
also more than $51 million in civil penalties.
    And we have strategically targeted entities that we believe 
facilitate the illegal robocallers. Specifically, we have sued 
entities that afford access to massive dialer or voice-blasting 
platforms that initiate the calls. We have also sued entities 
known as payment processors that afford access to the financial 
system and enable the robocallers to process payments from 
consumers.
    And, of course, our coordination with state, Federal, and 
international partners is as strong as ever. And I am happy to 
report that some of the individuals sued by the Federal Trade 
Commission for placing illegal calls have also been prosecuted 
criminally by the Department of Justice.
    We knew, though, that law enforcement was not enough and 
that more was needed. Toward those ends, we hosted a robocall 
summit last October, bringing together key players, engineers, 
academics, industry members, and of course law enforcers. We 
analyzed the technological changes that had given rise to the 
robocall tidal wave and existing structural impediments that 
served as obstacles to enhanced consumer protection.
    Recognizing consumers' frustration with robocalls, which we 
all share, we wanted solutions now. So we used the summit to 
launch the FTC's first public contest, which you discussed. It 
was a huge success in stimulating the marketplace to innovate 
and develop technological solutions that would help consumers 
block illegal robocalls.
    Mr. Foss's participation in the next panel illustrates the 
impact of the FTC's challenge to spur competition. He was 1 of 
3 winners, but nearly 800 eligible solutions were submitted, 
many of which presented well-thought-out technical proposals.
    And, as always, consumer education and outreach remain 
indispensable tools that complement our law enforcement and 
policy work.
    Finally, I want to assure you of our ongoing and sustained 
commitment to protect consumer privacy and halt illegal 
telemarketing fraud by enforcing the Do Not Call Registry and 
by tackling illegal robocalls. And I look forward to any 
questions you may have.
    Thank you.
    [The prepared statement of Ms. Greisman follows:]

           Prepared Statement of the Federal Trade Commission
    Chairman McCaskill, Ranking Member Heller, and members of the 
Subcommittee, I am Lois Greisman, Associate Director of the Division of 
Marketing Practices, Bureau of Consumer Protection at the Federal Trade 
Commission (``Commission'' or ``FTC'').\1\ I appreciate the opportunity 
to appear before you today to discuss the Commission's initiatives to 
fight illegal robocalls.
---------------------------------------------------------------------------
    \1\ The views expressed in this statement represent the views of 
the Commission. My oral presentation and responses to questions are my 
own and do not necessarily reflect the views of the Commission or any 
individual Commissioner.
---------------------------------------------------------------------------
    In 2003, the FTC responded to enormous public frustration with 
unsolicited sales calls and amended the Telemarketing Sales Rule 
(``TSR'') to create a national Do Not Call Registry.\2\ The Registry, 
which currently includes more than 221 million telephone numbers,\3\ 
has been tremendously successful in protecting consumers' privacy from 
the unwanted calls of tens of thousands \4\ of legitimate telemarketers 
who participate in the Registry each year.\5\ More recently, changes in 
technology led to a new source of immense frustration--the blasting of 
prerecorded messages using Voice over Internet Protocol (``VoIP'') 
technology.\6\ In 2008, the Commission responded by amending the TSR to 
address this problem, prohibiting the vast majority of prerecorded 
sales calls unless the recipient has provided express written consent 
to receive them.\7\
---------------------------------------------------------------------------
    \2\ 68 Fed. Reg. 4580 (Jan. 29, 2003); 16 C.F.R. Part 310. The FTC 
issued the TSR pursuant to the Telemarketing and Consumer Fraud and 
Abuse Prevention Act, 15 U.S.C. Sec. Sec. 6101-6108.
    \3\ See Appendix A, National Do Not Call Registry Active 
Registrations and Complaint Figures.
    \4\ For example, in Fiscal Year 2012, more than 28,000 
telemarketers accessed the Do Not Call Registry. National Do Not Call 
Registry Data Book FY 2012 at 8 (Oct. 2012), available at http://
www.ftc.gov/os/2012/10/1210dnc-databook.pdf.
    \5\ Humorist Dave Barry called the Do Not Call Registry ``the most 
popular Federal concept since the Elvis stamp.'' See Dave Barry, Idea 
for telemarketers: Hang up and go away, Deseret News, Aug. 31, 2003, 
available at http://www.deseretnews.com/article/1006979/Idea-for-
telemarketers-Hang-up-and-go-away.html.
    \6\ See Section II(A), infra.
    \7\ 73 Fed. Reg. 51164 (Aug. 29, 2008); 16 C.F.R. Part 
310.4(b)(1)(v). The FTC had already brought robocall-related 
enforcement actions prior to 2008, alleging that defendants made 
illegal ``abandoned calls,'' because their robocalls did not ``connect 
the call to a sales representative within two seconds of the completed 
greeting of the person who answer[ed].'' 16 C.F.R. Part 
310.4(b)(1)(iv). Any telemarketing campaign consisting solely of 
prerecorded messages would always violate that provision, and would not 
meet the abandoned call safe harbor requirements under the TSR. See 16 
C.F.R. Part 310.4(b)(4). Nonetheless, the Commission amended the TSR to 
explicitly prohibit unsolicited robocalls, considering it beneficial to 
make the prohibition more prominent.
---------------------------------------------------------------------------
    Illegal robocalls are still a significant consumer protection 
problem today, because they repeatedly disturb consumers' privacy and 
many of them peddle fraudulent goods and services that cause 
significant economic harm. Therefore, the FTC is using every tool at 
its disposal to fight them.\8\ This testimony describes the 
Commission's efforts to stop telemarketer violations, including our 
aggressive law enforcement, initiatives to spur technological 
solutions, and broad consumer and business outreach.
---------------------------------------------------------------------------
    \8\ See FTC Robocall Action Plan, http://www.ftc.gov/robocalls.
---------------------------------------------------------------------------
I. Do Not Call and Robocall Law Enforcement
    Since the Do Not Call Registry was established in 2003,\9\ the 
Commission has fought vigorously to protect consumers' privacy from 
unwanted calls. Indeed, two weeks ago on the 10th anniversary of the Do 
Not Call Program, the Commission announced that Mortgage Investors 
Corporation, one of the Nation's leading refinancers of veterans' home 
loans, will pay $7.5 million, the largest Do Not Call fine the FTC has 
ever collected.\10\ This case is the 105th enforcement action since the 
Commission began enforcing the Do Not Call provisions of the TSR in 
2004.\11\ Through these enforcement actions, the Commission has sought 
civil penalties,\12\ restitution for victims of telemarketing scams, 
and disgorgement of ill-gotten gains from the 298 companies and 234 
individuals involved. Although a number of cases remain in litigation, 
the 81 cases that have concluded thus far have resulted in orders 
totaling more than $126 million in civil penalties and $741 million in 
redress or disgorgement. In the first several years of the Registry's 
existence, consumers reported that the Do Not Call program was highly 
effective in reducing the number of unwanted telemarketing calls they 
received.\13\
---------------------------------------------------------------------------
    \9\ In 2003, two different district courts issued rulings enjoining 
the Do Not Call Registry. See Press Release, FTC Files Motion to Stay 
Pending Appeal in Oklahoma DNC Ruling (Mar. 24, 2003), available at 
http://www.ftc.gov/opa/2003/09/dncok.shtm; Press Release, Statement of 
FTC Chairman Timothy J. Muris (Sept. 26, 2003), available at http://
www.ftc.gov/opa/2003/09/dnc030926.shtm. Congress addressed the first 
decision in summary fashion by enacting HR 3161 in one day. See ``HR 
3161 (108th) Do-Not-Call-Registry bill,'' http://www.govtrack.us/
congress/bills/108/hr3161; Press Release, Statement of FTC Chairman 
Timothy J. Muris (Sept. 25, 2003), available at ttp://www.ftc.gov/opa/
2003/09/dnc030926.shtm. The 10th Circuit reversed the second district 
court decision on February 17, 2004. See Press Release, Appeals Court 
Upholds Constitutionality of National Do Not Call Registry (Feb. 17, 
2004), available at http://www.ftc.gov/opa/2004/02/dncappeal.shtm.
    \10\ See Press Release, Mortgage Broker Targeting U.S. 
Servicemembers Will Pay Record $7.5 Million to Settle Alleged 
Telemarketing Violations (June 27, 2013), available at http://
www.ftc.gov/opa/2013/06/donotcall.shtm.
    \11\ The 105 Do Not Call actions include cases that involve the 
rule provisions prohibiting unauthorized robocalls, which also invade 
consumers' privacy and may be deceptive as well.
    \12\ As is true of for all TSR violations, telemarketers who 
violate the Do Not Call provisions are subject to civil penalties of up 
to $16,000 per violation. 15 U.S.C. Sec. 45(m)(1)(A); 16 C.F.R. 
1.98(d).
    \13\ For example, in October 2007, an independent study by Harris 
Interactive found that of the 72 percent of Americans who had 
registered their telephone numbers for the Do Not Call Registry, 18 
percent reported that they currently received no telemarketing calls, 
59 percent reported that they still received some, but far fewer than 
before they signed onto the Registry, and 14 percent said they received 
some, but a little less than before they registered. Previous surveys 
had similar results. See Annual Report to Congress for FY 2007 Pursuant 
to the Do-Not-Call Implementation Act on Implementation of the National 
Do Not Call Registry, at 4-5, n.10 (July 2008), available at http://
www.ftc.gov/os/2008/07/P034305FY0dncreport.pdf.
---------------------------------------------------------------------------
    On September 1, 2009, new TSR provisions went into effect 
prohibiting the vast majority of sales robocalls,\14\ unless the 
telemarketer has the consumer's prior written authorization to transmit 
such calls.\15\ The robocall provisions cover prerecorded calls to all 
consumers, including those who have not registered their phone number 
on the Do Not Call Registry. The Commission has been aggressive in 
enforcing prohibitions on robocalls, bringing 34 cases involving 
illegal prerecorded calls against 97 companies and 77 individuals.\16\ 
These actions have shut down entities responsible for billions of 
illegal robocalls, and the 22 cases that have concluded thus far have 
resulted in orders totaling more than $51 million in civil penalties 
and $202 million in redress or disgorgement. Some of the Commission's 
early robocall cases were against companies with household names such 
as Dish Network, DIRECTV, and Talbots.\17\
---------------------------------------------------------------------------
    \14\ Like the other provisions of the TSR, the robocall provisions 
do not apply to non-sales calls, such as calls placed by charities or 
those that are pure political, informational, or survey calls. See 
generally ``Complying with the Telemarketing Sales Rule'' (Feb. 2011), 
available at http://business.ftc.gov/documents/bus27-complying-
telemarketing-sales-rule.
    \15\ 16 C.F.R. Part 310.4(b)(1)(v). Limited exceptions exist for 
calls that deliver a healthcare message made by an entity covered by 
the Health Insurance Portability and Accountability Act, 16 C.F.R. Part 
310.4(b)(1)(v)(D), and for certain calls placed by telemarketers who 
solicit charitable contributions, 16 C.F.R. Part 310.4(b)(1)(v)(B).
    \16\ The FTC filed 12 of the 34 cases before the rule change went 
into effect on September 1, 2009.
    \17\ See U.S. v. The Talbots, Inc., No. 10-cv-10698 (D. Mass. Apr. 
27, 2010), available at http://www.ftc.gov/opa/2010/04/talbots.shtm; 
U.S. v. Dish Network, LLC, No. 3:09-cv-03073 (C.D. Ill. Feb. 4, 2010), 
available at http://www.ftc.gov/opa/2009/03/echostar.shtm; U.S. v. 
DIRECTV, Inc., No. 09-02605 (C.D. Cal. Apr. 23, 2009), available at 
http://www.ftc.gov/opa/2009/04/directv.shtm.
---------------------------------------------------------------------------
    Yet increasingly, robocalls that plague consumers are initiated by 
fraudsters, who often hide out in other countries in an attempt to 
escape detection and punishment. One example is the defendants in FTC 
v. Navestad, who the Commission successfully traced and sued even after 
they attempted to hide their identities through fake caller IDs, 
shifting foreign operations, and name changes. The court found that the 
defendants made in excess of eight million robocalls, and ordered them 
to pay $30 million in civil penalties and give up more than $1.1 
million in ill-gotten gains.\18\ Unfortunately, the two defendants are 
currently in hiding overseas.
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    \18\ FTC v. Navestad, No. 09-CV-6329 (W.D.N.Y. Mar. 23, 2012), 
available at http://www.ftc.gov/opa/2012/04/cashgrant.shtm.
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A. Coordination with Law Enforcement Partners
1. State, Federal, and International Coordination
    As the law enforcement challenges associated with illegal 
telemarketing have increased, the FTC's relationships with other 
agencies have become ever more important. The Commission has robust 
collaborative relationships with state law enforcers, including through 
the National Association of Attorneys General Do Not Call working 
group. In addition, the FTC regularly works with the Federal 
Communications Commission (``FCC''), the Department of Justice, the 
U.S. Postal Inspection Service, and U.S. Attorneys' Offices across the 
country. The Commission also coordinates with its counterparts in other 
countries on particular cases and broader strategic matters such as 
caller ID ``spoofing''--the practice of faking a call's identifying 
information.
    The FTC's collaboration with its partners takes many different 
forms, including sharing information and targets, assisting with 
investigations, and working together on long-term policy initiatives. 
The agency also coordinates with various partners to bring law 
enforcement ``sweeps''--multiple simultaneous law enforcement actions--
that focus on specific types of telemarketing fraud.\19\ One recent 
example is a concerted attack on illegal robocalls purporting to be 
from ``Rachel'' or others from ``Cardholder Services,'' which pitch a 
supposedly easy way to save money by reducing consumers' credit card 
interest rates. The FTC brought five cases against companies that were 
allegedly responsible for millions of these illegal calls. The 
Commission simultaneously announced that state law enforcement partners 
in Arizona, Arkansas, and Florida had filed separate law enforcement 
actions as part of the same sweep.\20\
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    \19\ The following describe some of the telemarketing and robocall 
sweeps that the FTC and its law enforcement partners have conducted 
over the past several years: Press Release, FTC Leads Joint Law 
Enforcement Effort Against Companies that Allegedly Made Deceptive 
``Cardholder Services'' Robocalls (Nov. 1, 2012), available at http://
www.ftc.gov/opa/2012/11/robocalls.shtm; Press Release, FTC Settlements 
Put Debt Relief Operations Out of Business (May 26, 2011), available at 
http://www.ftc.gov/opa/2011/05/amsdynamic.shtm; Press Release, FTC Sues 
to Stop Robocalls with Deceptive Credit Card Interest-Rate Reduction 
Claims (Dec. 8, 2009), available at http://www.ftc.gov/opa/2009/12/
robocall.shtm; Press Release, FTC Cracks Down on Scammers Trying to 
Take Advantage of the Economic Downturn (July 1, 2009), available at 
http://www.ftc.gov/opa/2009/07/shortchange.shtm; Press Release, FTC 
Announces ``Operation Tele-PHONEY,'' Agency's Largest Telemarketing 
Sweep (May 20, 2008), available at http://www.ftc.gov/opa/2008/05/
telephoney.shtm.
    \20\ See Press Release, FTC Leads Joint Law Enforcement Effort 
Against Companies that Allegedly Made Deceptive ``Cardholder Services'' 
Robocalls (Nov. 1, 2012), available at http://www.ftc.gov/opa/2012/11/
robocalls.shtm.
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2. Referrals for Criminal Prosecution
    Although the Commission does not have criminal law enforcement 
authority, it recognizes the importance of criminal prosecution in 
deterrence. Accordingly, the Commission routinely works with Federal 
and state criminal law enforcers through its Criminal Liaison Unit 
(``CLU''). Since CLU's launch in 2003, hundreds of fraudulent 
telemarketers have found themselves facing criminal charges and prison 
time. One example is the Voice Touch case, which involved the use of 
robocalls to advertise an auto warranty scam. The FTC case shut down 
the scam and resulted in almost $3.2 million in redress to 
consumers,\21\ and the Office of the U.S. Attorney for the Southern 
District of Illinois subsequently brought criminal charges. Three of 
the fraud's principals have pleaded guilty and gone to prison, with the 
two leaders of the scheme each sentenced to five years.\22\
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    \21\ Press Release, FTC Returns Almost $3.2 Million to Auto 
Warranty Robocall Victims (Aug. 31, 2011), available at http://
www.ftc.gov/opa/2011/08/voicetouch.shtm; FTC v. Voice Touch, Inc., No. 
09CV2929 (N.D. Ill. Aug. 23, 2010), available at http://www.ftc.gov/os/
caselist/0823263.
    \22\ Department of Justice (``DOJ'') Press Release, ``Auto 
Warranty'' Telemarketer Pleads Guilty (June 15, 2012), available at 
http://www.justice.gov/usao/ils/News/2012/Jun/
06152012_Dolan%20Press%20Release.html; DOJ Press Release, Update on 
Transcontinental Warranty Case (Oct. 31, 2011), available at http://
www.justice.gov/usao/ils/Programs/VWA/transcontinental.html.
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    Another example is Kara Singleton Adams, the leader of a scam that 
used robocalls to sell worthless credit card interest rate reduction 
services. Not only did the Commission act to shut down the 
operation,\23\ a Federal jury in Atlanta subsequently convicted Adams 
on charges of wire fraud and conspiracy, among other things. In 2012, 
the court sentenced her to more than 17 years' imprisonment. Three of 
her associates in the scheme also went to prison.\24\
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    \23\ FTC v. Econ. Relief Techs., LLC, No. 09-CV-3347 (N.D. Ga. July 
22, 2010), available at http://www.ftc.gov/os/caselist/0923118.
    \24\ DOJ Press Release, Adams Sentenced to Over 17 Years in Prison 
for Multi-Million Dollar Telemarketing Fraud Scheme (Feb. 9, 2012), 
available at http://www.justice.gov/usao/gan/press/2012/02-09-12.html.
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B. Strategic Targeting for Maximum Impact
    The Commission constantly seeks innovative ways to maximize its 
resources and its impact on those responsible for illegal 
robocalls.\25\ Often, telemarketers' deceptive and abusive practices 
are facilitated by third parties, such as auto-dialers, which provide 
the software needed to blast out millions of calls, and payment 
processors, which enable fraudulent telemarketers to reach into 
consumers' bank accounts. The FTC has increasingly targeted gatekeepers 
that have tended to service large numbers of rogue telemarketers and 
therefore offer a way to strike a blow to many law-breakers with only 
one case.
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    \25\ As an example, the FTC recently created a robocall 
``honeypot,'' which is a group of phone numbers from around the country 
that the Commission controls, permitting it to receive robocalls 
directly. This allows the Staff to quickly amass information about who 
is making the calls and to have recordings in-house, thus facilitating 
a more rapid law enforcement response.


    Money flows in many directions within a robocall operation. \26\
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    \26\ The PSTN is the ``Public Switched Telephone Network.'' It 
consists of transmission facilities (e.g., phone lines, fiber optic 
cables, microwave transmission links, cellular radios, communication 
satellites, etc.) and switching facilities (central office switches, 
databases for 800 number translation, gear for cellular handoffs, 
multiplexors, etc.).

    First, the Commission aggressively pursues companies that provide 
the equipment and software necessary to send out millions of calls, 
sometimes referred to as ``voice broadcasters'' or ``autodialers.'' 
\27\ One example is FTC v. Asia Pacific Telecom, Inc., in which the FTC 
alleged that defendants were responsible for violating the TSR by 
placing billions of prerecorded phone calls on behalf of unscrupulous 
telemarketers. These robocalls pitched worthless extended auto 
warranties and credit card interest rate reduction programs while using 
spoofed Caller ID names--such as ``SALES DEPT''--and phone numbers 
registered to companies with overseas offices in the Northern Mariana 
Islands, Hong Kong, and the Netherlands. In 2012, the Commission 
reached a settlement under which the defendants are banned from all 
telemarketing, from misrepresenting any good or service, and from 
selling or otherwise benefitting from customers' personal information. 
The order imposed a $5.3 million judgment that was suspended, based on 
the defendants' inability to pay, after they had surrendered assets 
valued at approximately $3 million.\28\
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    \27\ U.S. v. Skyy Consulting, Inc., also d/b/a CallFire, No. 13-CV-
2136 (N.D. Cal. May 14, 2013), available at http://www.ftc.gov/os/
caselist/1223011; FTC v. Asia Pac. Telecom, Inc., No. 1:10-3168 (N.D. 
Ill. Mar. 28, 2012), available at http://www.ftc.gov/os/caselist/
1023060; U.S. v. Brian Ebersole, No. 3:12-cv-00105 (D. Nev. Feb. 29, 
2012), available at http://ftc.gov/os/caselist/0923174; U.S. v. Sonkei 
Commc'ns, No. SACV11-1777 (C.D. Cal. Nov. 22, 2011), available at 
http://ftc.gov/os/caselist/1123060; U.S. v. Voice-Mail Broad. Corp., 
No. cv-08-00521 (C.D. Cal. Jan. 29, 2008), available at http://
www.ftc.gov/os/caselist/0523182; U.S. v. The Broadcast Team, Inc., No. 
6:05-cv-01920 (M.D. Fla. Feb. 2, 2007), available at http://
www.ftc.gov/os/caselist/0523025/0523025.shtm.
    \28\ FTC v. Asia Pac. Telecom, Inc., No. 1:10-3168 (N.D. Ill. Mar. 
28, 2012), available at http://www.ftc.gov/os/caselist/1023060. The 
full judgment will become due immediately if the defendants are found 
to have misrepresented their financial condition.
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    Second, the FTC has increasingly taken action against payment 
processors when they assist and facilitate telemarketers engaged in 
deceptive practices, providing access to the financial system and, in 
turn, consumers' money.\29\ Two amended complaints the FTC filed in 
June provide examples of the agency's enforcement in this area. In both 
cases, the Commission sued telemarketing operations allegedly peddling 
bogus credit card interest rate reduction services. After obtaining 
temporary restraining orders against the defendants and beginning 
discovery, the FTC moved to amend both complaints to include the 
defendants' payment processors. The Commission alleges that the payment 
processors knew, or consciously avoided knowing, key facts about the 
illegal telemarketing,\30\ and chose to continue profiting from the 
illegal activity by processing consumers' payments to the original 
defendants.\31\
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    \29\ See, e.g., FTC v. Automated Elec. Checking, Inc., No. 3:13-cv-
00056 (D. Nev. Mar. 13, 2013), available at http://ftc.gov/os/caselist/
1223102; FTC v. Landmark Clearing, Inc., No. 4:11-cv-00826 (E.D. Tex. 
June 27, 2013), available at http://www.ftc.gov/os/caselist/1123117.
    \30\ 16 C.F.R. Part 310.3(b).
    \31\ FTC v. Innovative Wealth Builders, Inc., No. 13-cv-00123 (M.D. 
Fla. June 5, 2013), available at http://www.ftc.gov/os/caselist/
1223127; FTC v. WV Universal Mgmt., LLC, No. 6:12-CV-1618 (M.D. Fla. 
June 21, 2013), available at http://www.ftc.gov/os/caselist/1223190.
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    In sum, the Commission seeks to identify and attack chokepoints for 
illegal telemarketing.
II. Policy and Market Stimulation Initiatives
    Despite the 2008 prohibition of unauthorized robocalls and the 
Commission's vigorous enforcement efforts, technological advances have 
permitted law-breakers to continue to profit from illegal robocall 
campaigns. In the fourth quarter of 2009, the FTC received about 63,000 
complaints about illegal robocalls each month.\32\ That number 
ballooned in three years, to an average of approximately 200,000 
complaints per month in the fourth quarter of 2012.\33\
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    \32\ National Do Not Call Registry Data Book FY 2010 at 5 (Nov. 
2010), available at http://www.ftc.gov/os/2010/12/
101206dncdatabook.pdf. Since that time, the FTC began separately 
tracking Do Not Call complaints and robocall complaints based on 
information provided by the consumer.
    \33\ National Do Not Call Registry Data Book FY 2012 at 5 (Oct. 
2012), available at http://www.ftc.gov/os/2012/10/1210dnc-databook.pdf.


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    Number of robocall complaints filed with the FTC each month \34\

    \34\ While this chart suggests recent positive trending of self-
reported complaints, it has in no way diminished the Commission's law 
enforcement efforts.

    The public's anger has increased with the number of illegal 
robocalls.\35\ Robocalls propagate harmful frauds; indeed, the 
estimated consumer harm associated with the 22 FTC lawsuits against 
robocallers that have concluded thus far amounts to more than $202 
million.\36\ Illegal robocalls also have a significant impact on 
quality of life by repeatedly invading the privacy and peace of 
consumers' homes.\37\
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    \35\ See generally FTC Workshop, Robocalls: All the Rage (Oct. 18, 
2012). A webcast of the workshop, a transcript of the event, PowerPoint 
presentations, and other related materials are available at http://
www.ftc.gov/bcp/workshops/robocalls. References to the workshop 
transcript (``Tr.'') identify the speaker and the transcript page. See, 
e.g., Zoeller, Tr. at 86-87; Bash, Tr. at 88-89; Maxson, Tr. at 89-90.
    \36\ This estimate is based on the FTC's equitable monetary relief 
awards, and excludes civil penalties ordered in the same cases. In 
addition, it only includes cases that involved robocalls. The estimated 
consumer harm associated with the FTC's 81 concluded Do Not Call 
actions amounts to more than $741 million.
    \37\ See, e.g., Maxson, Tr. at 90-92; Zoeller, Tr. at 86-88; see 
also FTC, Robocall Challenge Comments [hereinafter Public Comment], 
available at http://www.ftc.gov/os/comments/robocallchallenge; Michelle 
Block, Public Comment, cmt. #565017-00015, at 1 (explaining how 
robocalls can cause her to lose desired assignments as a substitute 
teacher).
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A. Coordinating with Technical Experts, Industry, and Other 
        Stakeholders
    Convinced that law enforcement alone is not enough to solve the 
problem, FTC Staff has aggressively sought new strategies in ongoing 
discussions with academic experts, telecommunications carriers, 
industry coordinating bodies, technology and security companies, 
consumers, and counterparts at federal, state, and international 
government bodies. To that end, on October 18, 2012, the Commission 
hosted a public summit on robocalls to explore these issues (the 
``Robocall Summit'').\38\
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    \38\ See generally FTC Workshop, Robocalls: All the Rage (Oct. 18, 
2012), http://www.ftc.gov/bcp/workshops/robocalls.
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    The Robocall Summit made clear that convergence between the legacy 
telephone system and the Internet has given rise to massive, unlawful 
robocall campaigns. The telephone network has its origins in a manual 
switchboard that allowed a human operator to make connections between 
two known entities.\39\ A small group of well-known carriers were in 
control and were highly regulated.\40\ Placing calls took significant 
time and money, and callers could not easily conceal their 
identities.\41\
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    \39\ Bellovin, Tr. at 12.
    \40\ Schulzrinne, Tr. at 22; Rupy, Tr. at 46-47; Diggs, Tr. at 55.
    \41\ Bellovin, Tr. at 12-17.
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    Now, communications technology is universal and standardized such 
that entrepreneurs can build up a viable telephone services business 
wherever they find an Internet connection.\42\ As a result, the number 
of service providers has grown exponentially and now includes thousands 
of small companies all over the world.\43\ In addition, VoIP technology 
allows consumers to enjoy high-quality phone calls with people on the 
other side of the planet for an affordable price.\44\ With this 
efficiency came other changes: instead of a voice path between one wire 
pair, the call travels as data; identifying information can be spoofed; 
many different players are involved in the path of a single call; and 
the distance between the endpoints is not particularly important.\45\ 
As a result, it is not only much cheaper to blast out robocalls; it is 
also easier to hide one's identity when doing so.
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    \42\ Herrman, Tr. at 60-61; Maxson, Tr. at 96.
    \43\ Schulzrinne, Tr. at 22.
    \44\ See, e.g., Bellovin, Tr. at 16-17.
    \45\ Id. at 17.
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1. New Technologies Have Made Robocalls Extremely Inexpensive
    Until recently, telemarketing required significant capital 
investment in specialized hardware and labor.\46\ Now, robocallers 
benefit from automated dialing technology, inexpensive long distance 
calling rates, and the ability to move internationally and employ cheap 
labor.\47\ The only necessary equipment is a computer connected to the 
Internet.\48\ The result is that law-breaking telemarketers can place 
robocalls for less than one cent per minute.\49\ In addition, the 
cheap, widely available technology has resulted in a proliferation of 
entities available to perform any portion of the telemarketing process, 
including generating leads, placing automated calls, gathering 
consumers' personal information, selling the products, or doing all of 
the above.\50\ Because of the dramatic decrease in upfront capital 
investment and overall cost, robocallers--like e-mail spammers--can 
make a profit even if their success rate is very low.\51\
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    \46\ Herrmann, Tr. at 58-59; Schulzrinne, Tr. at 24.
    \47\ Schulzrinne, Tr. at 24.
    \48\ Herrmann, Tr. at 59-61.
    \49\ See Dan Weber, Alan Basinger, Dean Willis, and David Schwartz, 
Public Comment, cmt #565017-00014, at 3.
    \50\ Schulzrinne, Tr. at 20-21; Maxson, Tr. at 95-98.
    \51\ Schulzrinne, Tr. at 21; Bellovin, Tr. at 16-17.
    
    
    Technology enables a cheap and scalable model for robocalls.
2. New Technologies Have Made It Easier for Robocallers to Hide
    Technological changes have also affected the marketplace by 
enabling telemarketers to conceal their identities when they place 
calls. First, direct connections do not exist between every pair of 
carriers, so intermediate carriers are necessary to connect the 
majority of calls. Thus, the typical call now takes a complex path, 
traversing the networks of multiple different VoIP and legacy carriers 
before reaching the end user.\52\ Each of these carriers knows which 
carrier passed a particular phone call onto its network, but likely 
knows little else about the origin of the call.\53\ Such a path makes 
it cumbersome to trace back to a call's inception.\54\ All too often, 
this process to trace the call fails completely because one of the 
carriers in the chain has not retained the records that would further 
an investigation.\55\
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    \52\ Panagia, Tr. at 130-32; Bellovin, Tr. at 17.
    \53\ Panagia, Tr. at. 132; Maxson, Tr. at 100.
    \54\ Schulzrinne, Tr. at 24-25; Maxson, Tr. at 100; Bash, Tr. at 
104.
    \55\ Panagia, Tr. at 160-61; see also id. at 132-133; Schulzrinne, 
Tr. at 21.
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    Second, new technologies allow callers to manipulate the caller ID 
information that appears with an incoming phone call.\56\ This ``caller 
ID spoofing'' has beneficial uses; legitimate companies adjust their 
caller ID information regularly so that customers will see the most 
useful corporate number or name, rather than the phone number from 
which an agent actually placed the call.\57\ However, the same 
functionality allows robocallers to deceive consumers by pretending to 
be an entity with a local phone number or a trusted institution such as 
a bank or government agency.\58\ In addition, robocallers can change 
their phone numbers frequently in an attempt to avoid detection.\59\ It 
is generally illegal to transmit misleading or inaccurate caller 
identification information with the intent to defraud, cause harm, or 
wrongfully obtain anything of value, but many robocallers flagrantly 
violate this law.\60\
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    \56\ Schulzrinne, Tr. at 24-26.
    \57\ See, e.g., Panagia, Tr. at 129.
    \58\ Schulzrinne, Tr. at 21-22.
    \59\ Id. at 24-26; Maxson, Tr. at 97; Bash, Tr. at 103.
    \60\ See Truth in Caller ID Act, 47 U.S.C.Sec. 227(e); cf. 16 
C.F.R. Part 310.4(a)(8) (the Telemarketing Sales Rule requires that 
sellers and telemarketers transmit or cause to be transmitted the 
telephone number and, when made available by the telemarketer's 
carrier, the name of the telemarketer, to any caller identification 
service in use by a recipient of a telemarketing call, or transmit the 
customer service number of the seller on whose behalf the call is made 
and, when made available by the telemarketer's seller, the name of the 
seller. Under this provision, it is not necessary to prove intent to 
defraud.).
---------------------------------------------------------------------------
    Finally, new technologies help robocallers operate outside the 
jurisdiction where they are most likely to face prosecution.\61\ 
Indeed, all of the many different entities involved in the path of a 
robocall can be located in different countries, making investigations 
even more challenging.
---------------------------------------------------------------------------
    \61\ Schulzrinne, Tr. at 21; Bellovin, Tr. at 16-17.
    
    
    The path of a robocall can span the entire globe.
B. Need to Stimulate Technological Solutions
    The Commission recognized the need to spur the marketplace into 
developing technical solutions that could help American consumers block 
illegal robocalls. Thus, at the conclusion of the Robocall Summit, the 
FTC announced its first public contest, a ``Robocall Challenge'' hosted 
on the challenge.gov platform, with a $50,000 prize for the individual 
or small team that could propose a technological solution to help 
consumers block robocalls on their landlines and mobile phones. The 
Commission also offered a separate award for the best solution by an 
organization with ten or more employees, which did not have a cash 
prize.\62\
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    \62\ The judges for the Challenge were FTC Chief Technologist Steve 
Bellovin, FCC Chief Technology Officer Henning Schulzrinne, and co-
Executive Editor of All Things Digital Kara Swisher. The basic judging 
criteria were: Does it work? (50 percent); Is it easy to use? (25 
percent); and Can it be rolled out? (25 percent). For details, see FTC 
Robocall Challenge Criteria Details, http://www.robocall.challenge.gov/
details/criteria.
---------------------------------------------------------------------------
    The FTC received an astounding 798 eligible submissions, many of 
which were extremely well-considered technical proposals that moved the 
ball forward. As a result of the Robocall Challenge, a wide array of 
people with the necessary technical expertise spent countless hours 
thinking about these issues. All of the winning proposals were 
submitted by people who had never previously worked on the specific 
problem of illegal robocalls. In addition, the Robocall Challenge 
received an overwhelming amount of public attention and interest, 
helping the FTC spread the word about illegal robocalls and what 
consumers can do to fight them.
    The primary goal of the Robocall Challenge was encouraging 
development of realistic ideas for decreasing the prevalence of 
telemarketing robocalls in a way that the FTC's traditional law 
enforcement efforts could not achieve alone. On April 2, 2013, the 
agency announced three winning solutions, which all contained promising 
ideas about how to address difficult realities such as the limitations 
of the telecommunications infrastructure and the prevalence of caller 
ID spoofing.\63\ As the winning contestants and others further develop 
their ideas for introduction into the marketplace, we expect positive 
results for American consumers.
---------------------------------------------------------------------------
    \63\ See Press Release, FTC Announces Robocall Challenge Winners; 
Proposals Would Use Call Filter Software to Reduce Illegal Calls (Apr. 
2, 2013), available at http://www.ftc.gov/opa/2013/04/robocall.shtm; 
Appendix B, Summary of Winning Robocall Challenge Submissions.
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III. Consumer Education
    Public education is an equally essential tool in the FTC's consumer 
protection and fraud prevention work. The Commission's education and 
outreach program reaches tens of millions of people a year through our 
website, the media, and partner organizations that disseminate consumer 
information on the agency's behalf.
    The FTC delivers actionable, practical, plain language information 
on dozens of issues. Indeed, the Commission uses law enforcement 
announcements as opportunities to remind consumers how to recognize a 
similar situation and report it to the FTC. In the case of robocalls, 
whether the offer involves fraudulent credit card services, so-called 
auto warranty protection plans, or bogus vacation travel packages, the 
FTC's message to consumers is simple: If you answer a call and hear a 
recorded sales message--and you haven't given your written permission 
to get calls from the company on the other end--hang up. Period. Other 
key self-help messages to consumers include how to place a phone number 
on the Do Not Call Registry, what to consider before asking a phone 
carrier to block calls, and how and where to report illegal robocalls. 
The FTC's education materials also explain how robocallers use 
technology to make thousands of calls at minimal cost, send fake caller 
ID information, and conceal their locations. The FTC disseminates these 
tips through articles,\64\ blog posts,\65\ social media,\66\ 
infographics,\67\ videos \68\ and audio.\69\
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    \64\ See, e.g., FTC Robocall Microsite, http://
www.consumer.ftc.gov/features/feature-0025-robocalls.
    \65\ See, e.g., FTC Consumer Information Blog, http://
www.consumer.ftc.gov/blog.
    \66\ See, e.g., FTC Robocalls Facebook Q&A Transcript (July 17, 
2012), http://www.ftc.gov/opa/socialmedia/facebookchats/
1207ftcrobocallsfb.pdf.
    \67\ See, e.g., FTC Robocalls Infographic, http://www.ftc.gov/bcp/
edu/microsites/robocalls/infographic.shtm.
    \68\ See, e.g., FTC Video and Media, http://www.consumer.ftc.gov/
media.
    \69\ See, e.g., FTC Consumer Information Audio, ``Hang Up on 
Robocalls,'' http://www.consumer.ftc.gov/media/audio-0045-hang-
robocalls.
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    The FTC updates its consumer education whenever it has new 
information to share. The Commission's library of articles on robocall 
scams in English and Spanish also includes pieces specifically 
describing credit card interest rate reduction scams, auto service 
contract and warranty fraud, and travel-related schemes.\70\ When 
Robocall Challenge participants submitted to the Commission techniques 
they were using to successfully reduce illegal robocalls, the GSA and 
FTC used these tips in a video that relays some of the best consumer 
suggestions about what works today to fight robocalls.\71\
---------------------------------------------------------------------------
    \70\ See FTC Consumer Information, ``Travel Tips'' (May 2013), 
http://www.consumer.ftc.gov/articles/0046-travel-tips; FTC Consumer 
Information, ``Auto Service Contracts and Warranties'' (Aug. 2012), 
http://www.consumer.ftc.gov/articles/0054-auto-service-contracts-and-
warranties; FTC Consumer Information, ``Credit Card Interest Rate 
Reduction Scams'' (Feb. 2011), http://www.consumer.ftc.gov/articles/
0131-credit-card-interest-rate-reduction-scams; see generally FTC 
Robocall Microsite, http://www.consumer.ftc.gov/features/feature-0025-
robocalls; FTC Robocall Microsite in Spanish, ``Llamadas automaticas 
pregrabadas o robocalls,'' http://www.consumidor.ftc.gov/destacado/
destacado-s0025-llamadas-automaticas-pre-grabadas-o-robocalls.
    \71\ Robocall Challenge: Consumer Tips & Tricks (Apr. 2, 2013), 
http://www.consumer.ftc.gov/media/video-0086-robocall-challenge-
consumer-tips-tricks.
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    The Robocall Challenge expanded the reach of the Commission's 
consumer education messages about robocalls by spurring tremendous 
media interest. The announcement of the Challenge in October 2012 
prompted a nationwide flurry of articles and television stories.\72\ 
When the agency announced the winners in April 2013, it again made 
headlines in national news outlets and technology publications, also 
reaching a television audience of an estimated 2.2 million viewers in 
the first 24 hours following the announcement.\73\ Stories explained 
the problem of illegal robocalls and the FTC's determination to block 
them from landlines and mobile phones nationwide.
---------------------------------------------------------------------------
    \72\ See, e.g., Craig Timberg, Find a way to block ``robo-calls'' 
and win $50K from the FTC, Wash. Post, Oct. 18, 2012, available at 
http://www.washingtonpost.com/business/economy/find-a-way-to-block-
robocalls-and-win-50k-from-the-ftc/2012/10/18/a2d648c6-1943-11e2-aa6f-
3b636fecb829_story.html; Trevor Mogg, Wanna be a national hero? FTC 
contest offers $50,000 prize for solution to end annoying robocalls, 
Digital Trends, Aug. 18, 2012, available at http://
www.digitaltrends.com/cool-tech/ftc-contest-offers-50000-prize-for-
solution-to-end-annoying-robocalls; NBC Bay Area, FTC Holding Anti-Robo 
Call Contest, Oct. 20, 2012, available at http://www.nbcbayarea.com/
news/local/FTC-Holding-Anti-Robo-Call-Contest-175078991.html.
    \73\ See, e.g., Edward Wyatt, 2 Deterrents to Robocalls Win Contest 
by FTC, N.Y. Times, Apr. 2, 2013, available at http://www.nytimes.com/
2013/04/03/technology/two-deterrents-to-robocalls-win-ftc-contest.html; 
Jon Brodkin, No more robocalls: New tech automatically hangs up on 
robots, Ars Technica, Apr. 2, 2013, available at http://
arstechnica.com/information-technology/2013/04/no-more-robocalls-new-
tech-automatically-hangs-up-on-robots; Cristin Dorgelo, ``Innovative 
Solutions to Fight Illegal Robocalls,'' Apr. 17, 2013, http://
www.whitehouse.gov/blog/2013/04/17/innovative-solutions-fight-illegal-
robocalls.
---------------------------------------------------------------------------
IV. Next Steps and Conclusion
    The 10-year old Do Not Call Registry remains enormously successful 
in protecting consumers against unsolicited calls from legitimate 
telemarketers. But as technology changes and fraudsters exploit those 
changes, we must remain agile and creative. The Commission will 
continue its multifaceted efforts to fight illegal robocalls, including 
but not limited to the following actions:

   Continue Aggressive Law Enforcement

     We will maintain our enforcement efforts, in 
            coordination with state, federal, and international 
            partners, to target high-volume offenders and pursue 
            robocall gatekeepers in order to stop the largest number of 
            illegal calls.

     We will work with the telecommunications industry, 
            encouraging carriers to be proactive in monitoring for 
            illegal robocalls and securing the information necessary 
            for prosecutions.

   Spur Innovation

     We will work with industry leaders and other experts 
            to further stimulate the development of technological 
            solutions to block illegal robocalls.

     We will continue to encourage industry-wide 
            coordination to create and deploy VoIP standards that 
            incorporate robust authentication capabilities.\74\ Such 
            coordination is the only way to ensure a future phone 
            system with accurate and truthful calling information.
---------------------------------------------------------------------------
    \74\ This process will require active planning and cooperation in 
the coming months and years, as we move away from the legacy 
telecommunications infrastructure and toward a VoIP-based system. 
Experts around the world, including those involved in the Internet 
Engineering Task Force (``IETF''), have already begun to explore the 
technical changes necessary to permit authentication of VoIP calls. In 
fact, the IETF is in the process of creating a working group about this 
very topic called ``STIR''--Secure Telephone Identity Revisited. 
Participants in the FTC Robocall Summit also mentioned the Alliance for 
Telecommunications Industry Solutions as the type of standard-setting 
group that might assist in organizing the necessary collaboration. 
Schulzrinne, Tr. at 167; see also Rupy, Tr. at 51, 67; Diggs, Tr. at 
68-69; Whitt, Tr. at 208-09; see generally Paula Bailey-Stine, Public 
Comment, cmt #565017-00022, at 3-5.

---------------------------------------------------------------------------
   Engage in Ongoing Consumer Education

     We will continue our broad outreach to consumers 
            regarding the Do Not Call Registry as well as illegal 
            robocalls and how best to fight them.

   Work with Congress

     We stand ready to assist in your efforts to protect 
            consumers.

    Thank you for the opportunity to share some of the highlights 
regarding the FTC's battle against illegal robocalls. We look forward 
to working with you on this important issue.
                               Appendix A
National Do Not Call Registry Active Registrations and Complaint 
        Figures
        
        
                               Appendix B
           Summary of Winning Robocall Challenge Submissions


                           Appendix B (Con't)



    Senator McCaskill. Thank you very much, Ms. Greisman. Sorry 
I mispronounced your name at the beginning.
    Mr. Bash?

          STATEMENT OF ERIC J. BASH, ASSOCIATE CHIEF,

                      ENFORCEMENT BUREAU,

               FEDERAL COMMUNICATIONS COMMISSION

    Mr. Bash. Good morning, Chairman McCaskill and Ranking 
Member Heller. I am Eric Bash, Associate Chief of the Federal 
Communications Commission's Enforcement Bureau. Thank you for 
the opportunity to appear before you today.
    Almost every American has personal experience with 
robocalls, and almost everyone is fed up with them. With our 
own six-figure volume of complaints last year, we hear you.
    So what exactly is a robocall at the FCC? What makes one 
illegal under our rules? What are we doing about them? And how 
could enforcement be enhanced?
    At the FCC, we use the term ``robocalls'' to refer not to 
just prerecorded calls but also autodialed calls, regardless of 
whether the call is live or prerecorded. Under FCC rules, these 
calls cannot be made to a number assigned to emergency 
telephone lines, lines in guest rooms in health-care 
facilities, or wireless devices except in two cases: one, for 
an emergency purpose; or, two, with the prior express consent 
of the called party. That means that robocalls generally cannot 
be made to wireless devices or the other restricted lines I 
mentioned, even for a noncommercial purpose.
    Prerecorded calls to residential landlines are subject to 
fewer limitations, but only a few less. Prerecorded calls to 
residential lines can be made for non-emergency purposes 
without the called party's consent, but only if the call is 
made, one, for a noncommercial purpose or, two, for a 
commercial but not telemarketing purpose or, three, by certain 
defined persons to deliver a health-care message or, four, by 
or for a nonprofit organization. Any otherwise permissible 
robocall must also include certain identifying disclosures to 
be legal.
    The FCC also recently adopted rules to create a special do-
not-call list for lines answered by public safety answering 
points and is prohibiting all autodialed calls to numbers 
registered on that list.
    As you know, the FCC shares responsibility at the Federal 
level with the Federal Trade Commission for enforcement against 
telemarketing calls, including telemarketing robocalls. The 
agencies maintain consistency between their rules pursuant to 
statute and a memorandum of understanding. Both agencies' rules 
prohibit making prerecorded telemarketing calls to any 
telephone number, mobile or residential, except with the 
express prior written consent of the called party.
    Congress has empowered the FCC to enforce the 
Communications Act in several ways. The tool the agency uses 
most is assessment of a monetary forfeiture. Under the 
Communications Act, the FCC may not impose such a forfeiture on 
a non-licensee, meaning someone other than broadcasters or 
carriers, for example, until it first issues a citation to the 
wrongdoer for an illegal act and the wrongdoer thereafter 
repeats the same kind of misconduct. The maximum penalty for 
non-licensees is generally $16,000 or about one-tenth the 
amount of that for carrier licensees.
    Over the last decade, the FCC has issued more than 500 
citations and taken approximately 10 forfeiture-related actions 
involving millions of dollars of penalties for robocall rule 
violations.
    Our two most recent robocall actions cited operators of 
platforms that, according to our investigations, made almost 6 
million impermissible robocalls to mobile phones in just 
several months. The operators offered a service to call the 
phone numbers provided by their clients, to deliver the 
prerecorded message provided by their clients, and to display 
on consumers' caller ID the telephone numbers provided by their 
clients.
    By focusing on these operators, rather than their 
individual clients, we hope to maximize the impact of our 
existing enforcement resources. Numerous other platform 
providers remain under investigation.
    Significant law enforcement challenges remain, however. A 
fundamental problem is identifying the wrongdoer. Robocallers 
often spoof the number from which they are calling, so 
inquiries to carriers that control the numbers displayed to the 
consumers may not yield useful identifying information. 
Investigators must therefore work backward, subpoenaing the 
called parties' carrier and, in turn, all intermediate carriers 
to find out where the call originated.
    Time is of the essence because some providers do not appear 
to keep relevant records for much time and because the FCC must 
initiate any forfeiture proceeding within 1 year of a 
violation.
    There are several ways in which the FCC's enforcement tools 
might be enhanced. Congress might, for example, consider 
changing the FCC's authority by, one, allowing the FCC to 
impose a forfeiture on non-licensee robocaller violators 
without first issuing a citation; two, expanding the current 
statute of limitations from 1 year to 2; and, three, increasing 
the maximum forfeiture that the FCC can impose on non-licensee 
robocallers.
    To address the spoofing that complicates law enforcement, 
Congress might also consider extending the scope of the 
prohibition in the Truth in Caller ID Act against changing 
caller ID for harmful purposes to apply to offshore callers and 
more VOIP providers than just those who originate and terminate 
traffic on the public switched telephone network. Congress 
might also consider giving the FCC regulatory authority over 
third-party spoofing providers.
    There are also technological ideas on the table that may 
afford additional consumer protections from illegal robocalls. 
The FTC-sponsored contest helped to identify some of these 
ideas, and an industry standards organization is working with 
FCC technical staff on still more ideas.
    Thank you for the opportunity to appear before you today, 
and I welcome any questions you may have.
    [The prepared statement of Mr. Bash follows:]

   Prepared Statement of Eric J. Bash, Associate Chief, Enforcement 
               Bureau, Federal Communications Commission
    Good morning Chairman McCaskill, Ranking Member Heller, and Members 
of the Subcommittee. My name is Eric Bash, and I am an Associate Chief 
in the Enforcement Bureau of the Federal Communications Commission 
(FCC.) My responsibilities include oversight of the agency's 
enforcement of provisions in the Communications Act and the FCC's rules 
that are designed to protect consumers of telecommunications services. 
These provisions and rules include restrictions against ``robocalls,'' 
which is a popular shorthand way for to calls made using a prerecorded 
message or using an autodialer, whether the message is live or 
recorded. Thank you for the opportunity to appear today to address the 
FCC's role in combatting these calls.
    Almost every American is familiar with robocalls from their own 
personal experience. Who, for example, hasn't answered a phone call at 
one time or another, only to hear a recorded message encouraging the 
called party to ``press 1'' to claim a free vacation? Or to redeem a 
``last chance'' to lower mortgage rates? Or to extend an auto warranty? 
There are certainly legitimate robocalls--such as those consumers want, 
for example, to alert them to changes in school schedules--but most of 
these calls, at best, annoy consumers, and at worst, trick them into 
fraudulent transactions.
    At the FCC, we are also aware of, and take very seriously, the 
problem of robocallers making huge volumes of calls, either 
simultaneously or in rapid succession, to multiple lines at the same 
place of business, in order to overwhelm it. When these robocalls 
target first responders or hospitals telephone lines, they can threaten 
to interfere with legitimate calls that, if left unanswered, may 
literally mean the difference between life and death.
    The prevalence of these types of robocalls is on the rise. This is 
because of the ready availability and low cost of phone service and the 
software needed to make the calls, as well as the ability of callers to 
``spoof'' the number from which they are calling in an attempt to 
disguise who they are and avoid detection. It is no surprise, then, 
that robocalls are an increasing source of consumer complaints in 
recent years at the FCC, with the number of complaints about the topic 
doubling in the past two years to over 100,000 filed in 2012. While 
this is only a fraction of the total number of robocall complaints 
filed each year at various agencies, the volume at the FCC alone still 
speaks volumes, so to speak, about the extent of the problem. The FCC 
is also hearing more and more from first responders who are victims of 
sporadic autodialing.
    I have been asked to address you this morning to explain the FCC's 
role in combatting illegal robocalls. In doing so, I think it would be 
helpful first to describe the applicable law that Congress has charged 
the FCC with enforcing. I will then turn to the enforcement powers and 
process that Congress has given the FCC to discharge its 
responsibilities, and highlight some recent actions the agency has 
taken. I will close my prepared remarks by identifying some enforcement 
challenges we face in combatting illegal robocalls, and how we might 
begin to overcome them. I will also explain how the Federal Trade 
Commission's authority in this area complements the FCC's.
FCC-Enforced Legal Standards
    So what makes a robocall illegal under FCC-enforced standards? It 
depends upon the kind of number called, and the purpose of the call. 
The FCC's rules in this area flow directly from the Telephone Consumer 
Protection Act of 1991, or TCPA.
    Restricted Lines. Under the FCC's rules, no telephone call can be 
made using an autodialer or an artificial or prerecorded voice to 
certain ``restricted lines'' for non-emergency purposes without the 
called party's prior express consent. These ``restricted lines'' are 
emergency telephone lines (such as 911 lines), lines in guest/patient 
rooms in health care facilities, and all numbers assigned to mobile 
devices. Note that this restriction applies not just to calls with an 
artificial or prerecorded voice, but also to live calls made with an 
autodialer. For telemarketing calls, the prior express consent will 
have to be in writing after October 16, 2013.
    In this day and age of heavy mobile phone use, it may be worth 
repeating that the FCC's rules flatly prohibit all autodialed or 
prerecorded calls to mobile phones made for a non-emergency purpose 
without the called party's permission. It does not matter whether the 
call is to persuade the called party to buy some thing or to support 
some cause. And, despite common mischaracterizations of the law, it 
does not matter whether the called party is charged for the call, or 
whether the content of a message is blasted by text or voice. (The FCC 
has been clear that ``autodialed'' text messages fit within the 
restriction.) What matters is that a robocall was placed to a mobile 
phone, for a non-emergency purpose without the called party's consent. 
Robocallers can ensure that they are complying with this restriction by 
scrubbing their call lists against the telephone numbers that several 
commercial services offer to identify those assigned to mobile 
telephones.
    Residential Lines. Like calls made to restricted lines, calls using 
an artificial or prerecorded voice can be lawfully initiated to a 
residential line for an emergency purpose or with the called party's 
prior express consent, and, for telemarketing calls, the prior express 
consent will have to be in writing after October 16, 2013. But calls 
using an artificial or prerecorded voice can also be lawfully initiated 
to residential lines under several other circumstances. Such calls may 
be made if they contain certain disclosures and: (1) the call is made 
for a non-commercial purpose; or (2) the call is made for a commercial 
purpose but does not constitute telemarketing; or (3) the call delivers 
a health care message and is made by certain defined persons; or (4) 
the call is made by or for a tax-exempt non-profit organization. The 
disclosures must identify, at the beginning of the call, the person or 
entity responsible for initiating the call, and, during or after the 
message, provide a telephone number where that person or entity can be 
reached. And it is important to note that the restrictions for 
residential lines apply only to calls using prerecorded messages, not 
those using an autodialer.
    PSAP Lines. Pursuant to legislation passed last year, the FCC has 
also adopted rules that will create a special do-not-call registry for 
lines answered by public safety answering points (PSAPs), and has 
prohibited autodialed calls to numbers registered on that list. The 
legislation was designed to address the situation of autodialers 
placing calls to telephone numbers associated with emergency lines, and 
thereby precluding legitimate emergency-related calls from coming 
through. Note that this restriction applies to all autodialed calls, 
whether live or prerecorded.
FCC Enforcement Process
    Congress has empowered the FCC to enforce the Communications Act, 
including the TCPA, and the agency's implementing rules and orders, in 
several ways. In designating the FCC as the Federal agency that 
licenses and regulates those involved in electronic communication by 
wire or radio, Congress created different enforcement mechanisms that 
vary in terms of availability and severity according to whether the 
wrongdoer holds (or should hold) a license from the FCC.
    For licensees, such as broadcasters and carriers, the FCC's most 
powerful tool to enforce compliance with the law is to revoke a license 
for non-compliance, or deny issuance or renewal of the license. Because 
obtaining or retaining an FCC license may literally mean the difference 
between economic life and death for a licensee, the FCC does not resort 
to this remedy except in the most egregious cases of noncompliance.
    The FCC more commonly enforces the Communications Act, including 
the TCPA, and its implementing rules and orders by imposing monetary 
penalties. To do so, the FCC must either conduct a hearing, or issue a 
notice of apparent liability for forfeiture, or NAL. For administrative 
efficiency and other reasons, the agency most frequently follows the 
latter approach. A party subject to an NAL has an opportunity to submit 
factual and legal arguments in response explaining why the forfeiture 
proposed should be canceled or reduced. The FCC evaluates the response, 
and assuming it concludes that a forfeiture of some amount should be 
assessed, issues a final order imposing the penalty. If further legal 
action is necessary to collect the penalty, the FCC must refer the 
matter to the U.S. Department of Justice. While the FCC may impose a 
forfeiture either through a hearing or an NAL against both licensees 
and non-licensees, the Communications Act distinguishes between these 
groups, both in terms of process required and the severity of the 
penalty permitted. For non-licensees, under current law, generally 
speaking the FCC may impose a maximum penalty of $16,000 per violation, 
but may do so only after first issuing a citation to the wrongdoer 
finding that it has engaged in an illegal act, and, subsequent to the 
citation, the wrongdoer again engages in violations of the same type. 
By contrast, for carriers, which operate under express authorization 
from the FCC, the agency may impose a forfeiture of up to $150,000 per 
violation, without first citing the carrier. Likewise, broadcasters, 
which operate pursuant to an FCC license, generally speaking are 
directly subject to forfeitures of $37,500 per violation, without a 
prior citation. (These forfeiture amounts are those generally 
applicable for violations of the Communications Act, including 
violations of TCPA. Note that Congress has adopted other penalty 
structures in certain other circumstances.)
    The Communications Act also authorizes the FCC to issue an order to 
cease and desist against anyone violating a law it enforces; the Act 
envisions a trial-type administrative hearing in order to invoke this 
remedy. The Communications Act also authorizes the Department of 
Justice to obtain an injunction on behalf of the FCC.
FCC Enforcement Actions
    Using these enforcement powers, in the last decade, the FCC has 
issued more than 500 citations, and taken approximately 10 penalty-
related actions involving around $3.5 million, for violations of its 
robocall rules. (These are in addition to more than 500 citations and 
approximately 20 penalty-related actions for do-not-call telemarketing 
violations.) The FCC also issued an Enforcement Advisory last fall, as 
the election season was in full swing, to remind campaigns and those 
making calls on their behalf of the rules of the road for making 
robocalls. It is worth reiterating, as this advisory suggests, that the 
sweep of our rules is broad; they address not just telemarketing 
robocalls, but all robocalls, including political robocalls and 
robocalls to ``restricted lines'' without the called party's 
permission.
    I want to highlight the FCC Enforcement Bureau's two most recent 
robocall enforcement actions, taken just a few months ago. These 
reflect a change in approach designed to enhance the effectiveness and 
efficiency of agency enforcement in this area. Instead of targeting a 
single enterprise or individual behind a single type of robocall, the 
Bureau cited operators of platforms that make prerecorded calls in 
violation of the robocall rules. These operators offered a service 
whereby third-party clients could transmit or upload to the operator 
for delivery to specified called parties, along with the telephone 
numbers to which the operator was to place the calls. They could also 
choose the phone number that they wished the platform to display to the 
called party. The investigations leading to these citations found that 
the operators had made nearly six million impermissible robocalls in 
just several months. By addressing the platforms that make the illegal 
calls, as opposed to focusing on end-users behind such calls, we expect 
to cast a wider net and more efficiently use our limited resources to 
multiply the impact of our enforcement efforts. While I cannot comment 
on pending law enforcement matters where we have not yet taken a public 
action, I can say that these platforms remain an area of emphasis. I 
also want to add that, while the express language of the TCPA disallows 
``making'' prerecorded calls under the circumstances that were the 
subject of our platform citations, and unambiguously outlaws platforms 
from ``making'' calls like those I have described, the FCC recently 
issued a ruling to re-emphasize that anyone who makes a call on behalf 
of a third party is liable for violations of FCC rules implementing the 
TCPA. The third party on whose behalf an illegal call is made may also 
be vicariously liable for the violation.
Law Enforcement Challenges
    Notwithstanding the actions the FCC and others have taken over the 
last decade, significant challenges remain to stopping illegal 
robocalls, especially from those attempting to entice the called party 
to engage in a fraudulent transaction.
    Identification of Perpetrator. A fundamental problem for law 
enforcement in dealing with fraudulent as well as other robocallers 
remains identifying the parties responsible for them. Consumer 
complaints filed with the FCC about robocalls ordinarily provide little 
more information than the names used by callers, and the telephone 
numbers displayed on the called parties' caller ID, because this is 
normally all the data available to the complainant. But these pieces of 
information are not sufficient to enable prompt enforcement action if 
the robocaller has used a fake and nondescript name, and ``spoofs'' the 
number from which it is calling--that is, presents on the called 
party's caller ID a number other than the one from which the robocaller 
is actually calling. In these circumstances, subpoenas issued to the 
carrier that controls the apparent originating number may not yield 
identifying information. As a result, investigators must work backward 
and subpoena the called party's carrier for information about where 
that carrier obtained the call. Because multiple carriers may be 
involved in handling a single call, investigators may need to repeat 
this process a number of times before they can identify the true 
originator of a given call. Time is of the essence, as carriers 
maintain this kind of call detail record only for limited periods of 
time, and because the FCC is required by law to act within a year of a 
violation if it intends to impose a forfeiture penalty. As a result, 
the FCC is exploring ways to streamline the subpoena process with 
carriers.
    FCC Enforcement Options. Entities that or individuals who do not 
hold a Commission authorization and are not required to have one pose 
particular enforcement challenges. As I have noted, while we may cite a 
wrongdoer, finding that its conduct violates the law, we may not impose 
a monetary penalty directly. And while citations may work reasonably 
well for those who are unknowingly or negligently violating the 
regulatory and statutory provisions on robocalls, we believe a more 
immediate and tangible penalty may be needed to cause those who are 
intentionally violating the law to bring their conduct into compliance. 
Swift, stern enforcement powers are especially needed against 
fraudulent robocallers who use different names, change addresses 
frequently, and appear to open and close businesses on a regular basis. 
Law enforcement is also complicated, of course, when the robocaller 
appears to be physically located outside of the United States.
Federal Trade Commission
    As Members of this Subcommittee know, the FCC shares enforcement 
responsibility at the Federal level with the Federal Trade Commission 
(FTC) for combatting telemarketing calls, including telemarketing 
robocalls. The agencies maintain consistency between their 
telemarketing rules pursuant to the Do-Not-Call Implementation Act of 
2003. Thus, with respect to robocall rules in particular, both 
agencies' rules will, as of October 16, 2013, prohibit making 
prerecorded telemarketing calls, except with the prior express written 
consent of the called party. This consent is in addition to, and 
distinct from, registering a phone number on the national do-not-call 
list.
    To coordinate the exercise of their joint responsibilities in the 
telemarketing area, the FCC and the FTC also entered into a 
longstanding Memorandum of Understanding. Under the MOU, the agencies 
have agreed to, among other things, meet at regular intervals to 
discuss matters of mutual interest, to share complaints regarding 
potential violations of Federal telemarketing rules, and to work 
together to implement consistent and non-redundant enforcement of such 
rules. In fact, Ms. Greisman and I met with our agencies' respective 
staff just last week for law enforcement coordination purposes.
    One particular way the agencies have coordinated enforcement in the 
telemarketing area is by each agency focusing on the areas where its 
enforcement tools are best suited to the misconduct at issue. For 
example, the FCC's authorization over carriers provides a very powerful 
means of pursuing and remedying violations involving them. (While the 
FCC has not yet taken any action against a carrier for robocall 
violations, it has for do-not-call violations.) Moreover, our 
regulatory expertise with carriers gives us a familiarity with their 
processes that is uniquely helpful to us in obtaining the information 
we need to pursue robocall violations. The FTC, on the other hand, 
possesses particular advantages in discouraging robocall activity in 
connection with its efforts to thwart the fraudulent activity that 
often underlies robocalls. The FTC's ability to bring suit against non-
licensee miscreants, freeze assets and obtain restraining orders based 
on fraudulent activity can be quite effective in discouraging robocall 
behavior, although it is also quite resource intensive.
Overcoming Enforcement Challenges and Further Protecting Consumers
    To maximize the FCC's enforcement impact, Congress might consider 
making certain changes to the FCC's powers. For example, Congress might 
consider:

   allowing the FCC to impose a forfeiture on non-licensee 
        robocall violators without first having to issue a citation;

   expanding the current statute of limitation from one year to 
        at least two years, given the frequent need to engage in the 
        time-consuming process of identifying callers by working 
        backwards through a chain of carriers; and

   increasing the maximum forfeiture that the FCC can impose on 
        non-licensee robocallers.

    Congress might also consider revising the Truth-in-Caller-ID Act of 
2010. This statute prohibits spoofing when done by persons in the 
United States with the intent to defraud or cause harm or wrongfully 
obtain anything of value. When the FCC adopted implementing rules 
approximately two years ago, the agency's Chairman sent a report to 
Congress with proposed additional changes to the statute, including:

   expanding the scope of the prohibition to apply to persons 
        outside of the United States when their spoofing is directed at 
        people inside the United States;

   clarifying whether the existing restrictions should apply to 
        Voice over Internet Protocol providers that enable only 
        outbound calls; and

   giving the FCC appropriate authority to regulate third-party 
        spoofing services.

    As the report explained, the Department of Justice has advocated 
that third-party spoofing providers should be required to verify that a 
user has authority to use the telephone number it is seeking to have 
substituted for its own, in order to make it easier to identify actors 
who use these services for fraudulent or other harmful purposes.
    Technological solutions that empower consumers to block illegal 
robocalls so that they do not receive them in the first instance may 
also be helpful in thwarting illegal robocalls. An industry standards 
organization is currently working with FCC technology staff to design a 
system whereby originating carriers would cryptographically sign calls, 
so that receiving carriers can validate that callers in fact have the 
right to use the number they are using; as more carriers implement such 
solutions, methods could be developed to protect consumers from calls 
where the number cannot be validated. The staff involved hope that the 
joint effort may lead to implementable specifications in about a year. 
Other ideas about technical solutions were presented at the FTC's 
robocall summit last fall, as well as in the FTC's contest that closed 
just a few months ago.
    As legal changes and technological solutions are being considered, 
the FCC, along with the FTC and others, must continue to educate 
consumers about how to protect themselves from illegal robocalls, and 
when they receive them, how to file the most useful complaint with law 
enforcement. Such education includes discouraging consumers from 
interacting with any of the prompts in a robocall, and making sure that 
their complaints include as much information as possible, including the 
exact time and date of the call they received, and the carrier to whose 
service they subscribe. The FCC's website has its own consumer 
education materials, complaint forms, and cross-references useful 
material provided by the FTC.
Conclusion
    Thank you again for the opportunity to appear before you today to 
explain the FCC's role in addressing illegal robocalls. I welcome any 
questions you have for me.

    Senator McCaskill. Thank you both.
    Well, let me start with you, Mr. Bash. Do the statutes that 
guide your enforcement in this area, do they provide for the 
possibility of prison?
    Mr. Bash. They do not.
    Senator McCaskill. OK.
    And how about anything that you can do on your end at the 
FTC?
    Ms. Greisman. We do not have criminal law enforcement 
authority, but we work regularly with the Department of Justice 
and criminal authorities at the state level.
    Senator McCaskill. Is there an applicable statute that you 
can utilize at the Federal level that provides prison for 
people who do this?
    Ms. Greisman. Not on the part of the Federal Trade 
Commission.
    Senator McCaskill. Yes. Well, so nobody has gone to jail, 
right?
    Ms. Greisman. There have been criminal prosecutions of 
individuals who have been sued by the Federal Trade Commission 
for engaging in illegal robocalling in civil cases. The 
criminal prosecutions, I believe, have focused on allegations 
of wire fraud.
    Senator McCaskill. OK. And so the wire fraud prosecutions 
that have taken place in the area dealing with robocalls, has 
anybody gone to prison? Do you know?
    Ms. Greisman. Yes, I believe there have been significant 
sentences.
    Senator McCaskill. OK. Well, we need to get that word out. 
It seems to me that, you know, these guys aren't really afraid 
of you. I don't think that they are very nervous at all. 
Because it seems to me that they are just all in at this point.
    They have the technology to do massive amounts of calls for 
literally scraps off the table, with great potential of payoff. 
I mean, this is a criminal sandbox, and I can't imagine a more 
fun place to hang out if you are somebody who is a criminal. 
And I think we need to look at that also.
    Would some additional criminal statutes help you, Mr. Bash?
    Mr. Bash. I think additional legislation like that could be 
useful. The FCC, like the FTC, is not a criminal law 
enforcement agency, so I don't think we would be taking the 
actions ourselves there. But certainly----
    Senator McCaskill. I guarantee you that criminal 
prosecutions in this area would be way more popular than just 
about anything else the Department of Justice does.
    Mr. Bash. I am sure they would be.
    Senator McCaskill. What about the folks that are processing 
the payments on this? Do you feel like you have adequate 
statutes to go after them and put them in prison?
    Because somebody is moving this money through 
electronically, and they are making money off of it. And they 
have to know that this is not mom and apple pie that is being 
sold here, that they are making money off of.
    I know that we have had some actions against the payment 
processors. Are these companies that we would recognize that 
are processing these payments?
    Ms. Greisman. The Federal Trade Commission has taken action 
against payment processors for well over 10 years. The most 
recent ones were brought under the Telemarketing Sales Rule. 
They are alleged to have assisted and facilitated the illegal 
robocaller. And we have a burden of proof of showing that there 
is some level of knowledge there.
    I think, you know, there are two scenarios. There are those 
who facilitate fraud who are completely in cahoots with the 
fraudster; they know exactly what is going on. And then there 
are those who either do know or consciously avoid knowing. And, 
you know, it is just going to turn on the facts.
    But it is not necessarily the case that those who 
facilitate fraud, gatekeepers or chokepoints, are completely in 
bed with the fraudsters. They maybe avoid knowing what is going 
on.
    Senator McCaskill. Well, yes, but they are not hard to 
catch. Because if you set them up, if they are trying to avoid 
knowing, 9 times out of 10 if you send somebody in under cover 
to say the appropriate things, they are going to say something 
in reply that makes it clear that they are trying to--it is a 
little bit like the guy driving the getaway car: ``Well, I had 
no idea he was in there robbing the bank. You can't hold me 
liable.'' Well, under criminal law, we can.
    Ms. Greisman. You are right. And you are absolutely----
    Senator McCaskill. And this is, they are driving the 
getaway car.
    Ms. Greisman. Yes, they are facilitating the illegal----
    Senator McCaskill. Are these companies that we would 
recognize that are processing these payments? Are these, you 
know, the mainstream payment processors that process my 
payments to iTunes or my payments to Amazon? Are they the same 
people?
    Ms. Greisman. I am not sure that any of the ones that the 
FTC has sued of late are necessarily recognizable names. But we 
certainly will be looking across the industry to see whether 
there are any entities who facilitate----
    Senator McCaskill. That is reassuring that you are looking. 
And I certainly wasn't trying to make any allegation against 
those companies, that they are involved in this. I am just, you 
know--obviously, we are processing a lot of payments 
electronically these days. And there are recognized, reputable 
companies, and then there are others. And I am just assuming 
that this is all in the others'' space.
    Ms. Greisman. We look at each case as we see it----
    Senator McCaskill. OK.
    Ms. Greisman.--and we see who is involved.
    Senator McCaskill. Let me finish up, and then I will give 
it to Senator Heller.
    On the caller ID spoof, I have been asking my family to 
keep track of calls. And, in fact, I have gotten a few. I have 
learned something very important. If you ask for a phone 
number, they hang up. They are all trained that if you ask them 
for a phone number, they immediately hang up, because they know 
there is not a good ending there. So they just move on to the 
next call--if you have somebody live on the other end.
    I also have learned from my family members that they are 
using fraudulent caller ID numbers, that if you are getting a 
call in Saint Louis or if you are getting a call in Kansas 
City, the area code that they are using is, in fact, a state 
area code even though the call is being generated from far 
away, many times not even in this country.
    Can we go after the companies that are providing these 
numbers that clearly are not the numbers they are calling from?
    Mr. Bash. The folks who are providing the false number?
    Senator McCaskill. Yes.
    Mr. Bash. So let me get at that a couple of different ways.
    Under the robocall rules, it is really the legal standard 
is the person who is making the call, who is initiating the 
call. That is who is responsible under our law for a violation.
    There is, as I mentioned, the Truth in Caller ID Act that 
prohibits spoofing caller information with an intent to defraud 
or cause harm or wrongfully obtain anything of value. And if 
the folks that you are referring to would satisfy that 
standard, those are people that we could pursue.
    Senator McCaskill. Well, why would you give a false--why 
would you provide a number that is not really the number they 
are using for--what kind of good could there be?
    I mean, I am trying to figure out, I am trying to think 
about arguing a case to a jury in a criminal courtroom. Under 
what possible scenario would somebody be providing a phony 
caller ID number that wasn't up to something nefarious?
    Mr. Bash. Examples that are mentioned in the context of the 
rulemaking that the FCC did to implement these rules involved 
calls coming from a battered women's shelter. A call might need 
to be made out by someone who is living there to check on her 
children, and she is needing to protect the actual number from 
which she is calling.
    Senator McCaskill. And the blocked number is not sufficient 
in those instances? You can't just block the number so people 
can't see what it is?
    Mr. Bash. The example I gave you is what we have pointed to 
and what folks refer to as legitimate uses of spoofing caller 
ID.
    Senator McCaskill. In the grand scheme of things, I can't 
imagine that that is not just a tiny, infinitesimal number of 
these that are being given out.
    And I would certainly like--we are going to ask you to do 
some follow-up on this. But one of the follow-ups I would ask 
you to look at is, what do we need to do to strengthen the laws 
to go after the people that are providing these phony numbers? 
Because that is a huge part of the problem.
    Mr. Bash. And just to add to that, one of the suggestions 
that our former chairman made in submitting a report to 
Congress on potential changes to the Truth in Caller ID Act was 
to give the FCC direct regulatory authority over so-called 
third-party spoofing providers. These are people who are 
providing a service to people to spoof numbers.
    Senator McCaskill. Thank you very much.
    Senator Heller?
    Senator Heller. Thank you. And thanks again, Madam 
Chairman, for holding this hearing, and for our witnesses, for 
your testimony. Appreciate that.
    I would be surprised if there is anybody here in this room 
that hasn't at one time or another been subject to a 
telemarketing call. And I would submit that I have. That second 
recording that you did on extended warranties on vehicles, 
every time my vehicle gets to be about 4 or 5 years old, I get 
that phone call. And when you ask follow-up questions, they 
usually hang up on you when they find out that they can't 
deceive you.
    And in most cases, the deception practice is that you are 
thinking that you are talking to the original maker of that 
vehicle, whether that is a GM product, Ford product, or Nissan 
product. You think you are talking to that company. You know, 
at least they give off that perception. Then you find out that 
they are not associated with that organization.
    So I thought that was a great example of the type of 
deception that we hear and see all the time.
    Mr. Bash, you did a great job in your testimony of coming 
up with overcoming some of the enforcement challenges that you 
guys face.
    And I was wondering, Ms. Greisman, if you have other ways. 
What can we do here in Congress to help allow you to have more 
authority? Do you need more authority? I am going to ask the 
next panel, of course, the same question. But what do you need? 
What kind of enforcement challenges do you face that you need 
to overcome that Congress could help you with?
    Ms. Greisman. Well, I dare mention the common carrier 
exemption. We do think it is more than a relic. The commission 
is on record for the past several years in support of its 
elimination, and I certainly share that view.
    Senator Heller. OK. OK.
    I want to clarify the numbers. You know, you have testified 
a little bit, both of you, a little bit on the numbers, the 
challenges that you are faced with.
    Can you quantify the cost of this problem, both in the 
numbers of calls that people are receiving today and the cost? 
I know the chairman mentioned some costs. Just so that 
everybody here and those that are viewing this have an idea how 
big this problem is.
    Ms. Greisman. Sure. First, with respect to the numbers, we 
know that through our law enforcement action we have halted 
literally billions of illegal robocalls. And we know that from 
the cases we have brought.
    We also know that from the cases that have concluded in the 
robocall and do-not-call area that courts have ordered, I think 
it is, $740 million in redress or disgorgement. That, of 
course, is court-ordered. So that is at least a baseline for 
the scope of the magnitude of the economic injury being caused 
by this.
    Senator Heller. Do you agree with those numbers, Mr. Bash?
    Mr. Bash. Yes. And I just want to reiterate what I said in 
my testimony, that the two most recent actions that we took, 
just the particular months that we were looking at, for our 
enforcement actions, these two operators had placed 
approximately 6 million calls in just several months.
    Senator Heller. How many individuals in your office do you 
dedicate to enforcement of no calls, telemarketing scams like 
this?
    Mr. Bash. In the Enforcement Bureau, we have a handful of 
lawyers that are dedicated to dealing with this particular 
problem. On the policy side, our Consumer and Governmental 
Affairs Bureau works to implement the rules and change the 
rules as needed per any action you may take on Capitol Hill or 
to harmonize our rules with those of the Federal Trade 
Commission.
    Senator Heller. Is there a bureau within the FCC 
specifically dedicated to telemarketing fraud?
    Mr. Bash. There is not one that is specifically dedicated 
to that.
    Senator Heller. How about the FTC?
    Ms. Greisman. At the Federal Trade Commission, 
telemarketing rule enforcement, combating telemarketing fraud 
is something that is engaged in throughout the bureau. It is, 
as I mentioned before, a top priority.
    Senator Heller. Right.
    Ms. Greisman. And it is not just the bureau at 
headquarters. Every regional office is involved in the fight 
against illegal telemarketing. The shop that I head is the 
manager/coordinator, if you will, of the telemarketing fraud 
enforcement program.
    Senator Heller. Thank you. I will preserve questions for 
later.
    Senator McCaskill. Thank you.
    Let me ask just a couple more things.
    I want to make sure that it is clear how technology is 
changing this landscape. I think everyone has figured out that 
Congress is not nimble and we do not move quickly, and clearly 
we are behind the eight ball in many areas as it relates to 
technology.
    And both of the agencies you work for have a very difficult 
job, because you are trying to get everyone to hold hands and 
sing ``Kumbaya'' when there are competing commercial interests 
and just competing interests because of advancing technology.
    This is an area where most average Missourians don't 
understand why there is a different set of rules for the phone 
that rings in their house and the phone that rings in their 
purse. They don't understand why you can take action against a 
political campaign that calls the phone in the purse but you 
can't take action against the political campaign that calls in 
the family room when you are eating dinner.
    And so would you explain why there would be these different 
rules? And try, if you can--I have a hard time with figuring 
out--I know it all boils down to wired versus wireless, and in 
the old days when everyone was paying by the minute as opposed 
to the vast majority of plans now that are not--well, there are 
still plans that pay by the minute.
    But, you know, I don't think people--and then you have 
VoIP, which is, of course, the new method of phone calls that 
is not the common carriers but it is a wire nonetheless at some 
point. And where do they fall in this? And why should these 
rules all be different?
    Ms. Greisman. I will take a stab and then turn it over to 
Mr. Bash.
    From the FTC's perspective, it doesn't matter where the 
call rings. It doesn't matter whether it is at your home 
landline or in a device in your car, on your cell, wherever you 
are. It makes no difference; the telemarketing sales rule 
applies equally. And it doesn't matter whether it is coming 
over a copper wire or through the Internet.
    With respect to the charitable calls that you mentioned, 
the FTC does not have jurisdiction over those bone fide 
charitable fundraising calls. We are able to reach for-profit 
telemarketers who place calls on behalf of bona fide charities, 
however.
    Senator McCaskill. Right. So the people that call me that 
pretend that they are really helping the sheriffs and they are 
really taking 90 cents on the dollar and giving the sheriffs 10 
cents, can you go after them?
    Ms. Greisman. We can, and we have.
    Senator McCaskill. OK.
    Mr. Bash. So, as you heard me testify this morning, our 
rules do make a distinction between wireless phones and 
residential landlines. And the distinctions that our rules make 
flow directly from the Telephone Consumer Protection Act of 
1991.
    Senator McCaskill. That is obviously up-to-date.
    [Laughter.]
    Mr. Bash. Maybe you will revisit that. But that is why our 
rules make the distinction that they do. The statutory language 
is really quite prescriptive, so our rules just track what the 
legislative distinctions in the law are.
    And, as Lois was saying, with respect to VoIP, that is not 
really germane to the issue, because what matters is who is 
calling. It doesn't matter whether they are calling over VoIP 
or they are calling over a traditional telephone line. If you 
are making a call under the circumstances that are not legal, 
then it is impermissible.
    Senator McCaskill. I think we have to really take a look at 
updating all of this so that, you know--there is a whole 
generation that is going to be very blessed by the fact that 
they can't get political robocalls, because none of my kids 
have landlines. And, you know, they were really glad last 
October in Missouri, because it was ugly out there.
    But the elderly that are still answering that landline 
every day--I had a hard time. I felt like I needed this when I 
would go out in public, because everybody was so mad about 
these stupid political robocalls.
    Let me just finally ask your thoughts--it seems to me that 
you are playing Whac-A-Mole. And you are playing Whac-A-Mole 
with people that many times are in foreign countries, and the 
long arm of the law is really, really difficult in these 
circumstances, especially since they can make a lot of money 
and shut down fairly quickly and move on. And your limited 
tools in law enforcement do not allow you to be as quick as 
they are, in terms of being able to get to them before they 
have shut down and moved on to another location or another IP 
address.
    Talk a little bit about the technological solution. And 
what are the barriers that are in this country for--I mean, I 
know, I look at the technology that is available. I marvel at 
what I can do on this little, bitty box. I can run my life, 
literally, with this little, bitty box.
    It is so hard for me to believe that there is not the 
technology available yet in America that we can control this 
without the government having a great deal of involvement, just 
through a technological answer.
    And if you could speak to that briefly before we hear from 
our second panel, unless Senator Heller has more questions.
    Ms. Greisman. I would be happy to start.
    It is precisely because we felt there would be a 
technological solution that we launched the challenge. And the 
goal was to spur innovation, to tap into the genius of American 
consumers to develop ideas.
    And I think it was enormously successful. There were three 
winners. But it is not just those three winners who submitted 
proposals that might go to market; there are others out there. 
And I think you will be very encouraged when you hear from Mr. 
Foss on the second panel.
    Senator McCaskill. Great.
    Senator Heller?
    Senator Heller. Thank you.
    Mr. Bash, you talked a little bit about where these calls 
originate from. And I was wondering if you have any 
quantitative numbers of whether most of these robocalls are 
coming domestically or they are coming from foreign sources.
    Mr. Bash. I don't think I have data to give you on that. I 
think that----
    Senator Heller. Do you have a feel for it?
    Mr. Bash. I don't want to go out on a limb for that.
    Senator Heller. OK.
    Mr. Bash. But I think it is fair to say that they are 
coming from both places.
    Senator Heller. OK.
    Mr. Bash. They are coming from both places.
    Senator Heller. All right.
    Ms. Greisman, you talked about enforcement challenges. And 
one of the things, of course, that you asked for is to abolish 
the common carrier exemption. And, of course, that would 
protect carriers from dual regulations by both the FCC and the 
FTC.
    I guess my question to you is, is there any evidence or 
allegations that these common carriers are the source of these 
calls?
    Ms. Greisman. Let me address that this way. From where we 
sit, we think common carriers can do two things. One is they 
can be more proactive in looking at what is going across their 
transom and flagging what probably are red flags.
    We have some concerns that there may be some carriers out 
there--and remember, there is a real blurred distinction, given 
convergence in technology, of what is a telemarketer and what 
is actually a carrier. But we think there is some conduct that 
may be engaged in by some entities that purport to be carriers 
that would do more than raise an eyebrow.
    Senator Heller. OK. OK. I will probably ask the next panel 
the same question.
    Mr. Bash. If I could add----
    Senator Heller. Please.
    Mr. Bash.--on that subject, as I have mentioned in my 
written testimony, we obviously work with the Federal Trade 
Commission in coordinating law enforcement. And Lois and I, 
actually, just last week met on various coordination issues and 
issues with respect to carriers that she is aware of. She has 
made us aware of them, and we are certainly going to be looking 
at some of the information that was shared with us.
    Senator Heller. Terrific.
    Thank you for your time. I want to thank both witnesses for 
being here.
    And, Chairman, thank you very much.
    Senator McCaskill. Thank you.
    I am just curious, what is the conduct that raises the 
eyebrow? If you can tell us.
    Ms. Greisman. It is too soon at this point to get into.
    Senator McCaskill. OK.
    Ms. Greisman. Thank you.
    Senator McCaskill. I will be waiting.
    [Laughter.]
    Senator McCaskill. Thank you both.
    And if the next panel would come forward.
    I want to thank this panel. We have Mr. Kevin Rupy, Senior 
Director of Law and Policy, United States Telecom Association; 
Mr. Michael Altschul--am I saying that correctly?
    Mr. Altschul. Yes, you are. Thank you.
    Senator McCaskill.--Altschul, Senior Vice President and 
General Counsel at CTIA--The Wireless Association; Mr. Matthew 
Stein, Chief Technology Officer from Primus 
Telecommunications--welcome; thank you for being here--and Mr. 
Aaron Foss, Freelance Software Developer, Nomorobo.
    Thank you, Mr. Foss. We are glad you are here.
    And we will begin with your testimony, Mr. Rupy.

   STATEMENT OF KEVIN RUPY, SENIOR DIRECTOR, LAW AND POLICY, 
               UNITED STATES TELECOM ASSOCIATION

    Mr. Rupy. Chairwoman McCaskill, Ranking Member Heller, 
thank you for giving me the opportunity to appear before you 
today. My name is Kevin Rupy, and I serve as Senior Director of 
Law and Policy at the United States Telecom Association.
    U.S. Telecom and our member companies share the 
Subcommittee's concern about the problems associated with 
illegal robocalls. We understand the consumer frustration they 
cause, and we have long worked and coordinated with relevant 
private and government stakeholders to address this issue.
    In addition to the harm they cause consumers, robocalls 
impact U.S. Telecom's own member companies. Our companies' 
customer service representatives represent the first line of 
defense on this issue. They must be well-versed in explaining 
to customers the difference between legal and illegal 
robocalls, providing them with information on how to file a 
complaint with the FTC, and pointing them to tools to help them 
mitigate these calls.
    Robocalls can also adversely impact our companies' 
networks. Mass-calling events are typically highly localized, 
high-volume, extremely brief, lasting only a matter of minutes. 
And carriers receive no advance warning of these calls. A 
severe mass-calling event can result in service degradation and 
disruptions to phone services in a provider's impacted area. 
Moreover, illegal robocalls exacerbate an already troubling 
problem in our industry known as phantom traffic: calls that 
evade the established intercarrier compensation regime.
    Given these impacts on both our customers and our networks, 
we can sympathize with the frustration you must feel at the 
apparent growth of this problem over the last 2 decades in 
spite of repeated legislative efforts to put an end to it. 
Those efforts illustrate the difficulty of keeping the law 
ahead of the lawbreakers and ahead of technology.
    This is not to say that network operators are passive 
observers. As mentioned earlier, we serve on the front lines of 
defense and work in many other ways to monitor, mitigate, and 
respond to this problem. Many U.S. Telecom member companies 
maintain network operations centers that monitor network 
traffic, conduct traffic data forensics, and initiate mass-
calling investigations.
    Our members provide and will continue to develop various 
services, such as anonymous-call blocking, and other 
functionalities that help mitigate the problem. Network 
operators also work within standards-setting groups to address 
issues related to robocalls.
    Carriers initiate legal actions against robocallers when 
they can be found and coordinate with state and Federal law 
enforcement agencies during ongoing investigations and 
enforcement actions.
    Looked at through the lens of history, the explanation for 
this is regrettably fairly simple. The original phone network 
was a closed system, meaning that voice service was generally 
provided by local exchange carriers and long-distance companies 
through only the public switched telephone network, or PSTN, 
providing plain old telephone service.
    Today's communications services are provided not by the 
historical closed PSTN but by a network of networks. The 
interdependent, interconnected, and global nature of the 
Internet means that areas of vulnerability exist throughout the 
network and, therefore, cannot be realistically addressed by 
any single stakeholder.
    U.S. Telecom supports the development of possible 
technological solutions to the robocall problem by stakeholders 
throughout the Internet ecosystem, most of whom do not face the 
significant legal limitations outlined in my written statement 
that currently constrain our member companies.
    But it is unlikely that any single technological silver 
bullet can permanently address the robocall problem. Today's 
solution could very well turn into tomorrow's Maginot Line and 
could have unintended adverse consequences, some examples of 
which I also outline in my written testimony.
    The same increasingly appears to be the case for 
legislative and regulatory solutions, which regrettably do not 
seem capable of keeping pace with the evil genius of scammers, 
who continually invent new ways of evading discovery and 
capture, much less prosecution and punishment.
    In closing, let me again thank the Subcommittee for holding 
this timely hearing. We share both the Subcommittee's and 
consumers' frustration, and we look forward to our continued 
work together in a manner that provides flexibility in 
addressing this constantly evolving challenge.
    [The prepared statement of Mr. Rupy follows:]

  Prepared Statement of Kevin Rupy, Senior Director, Law and Policy, 
                   United States Telecom Association
    Chairwoman McCaskill, Ranking Member Heller, Members of the 
Subcommittee, thank you for giving me the opportunity to appear before 
you today to present the views of our industry on the burgeoning 
problem of robocalling. It is both timely and appropriate that the 
Subcommittee take time to review this important consumer protection 
issue. The United States Telecom Association (USTelecom) and our member 
companies are aware of the growing problem associated with illegal 
robocalls. We understand the consumer frustration they cause, and as a 
result we have long worked collectively and coordinated with relevant 
private and government stakeholders to address this issue.
    My name is Kevin Rupy, and I serve as Senior Director of Law and 
Policy at USTelecom. Our association represents innovative broadband 
companies ranging from some of the largest companies in the U.S. 
economy to some of the smallest cooperatives and family-owned telecom 
providers in rural America. Our members offer a wide range of 
communications services on both a fixed and mobile basis, and the 
overwhelming majority of them offer advanced broadband services 
including voice, video, and data. The customers that rely on our 
networks include consumers, businesses large and small, and government 
entities at the local, state, and Federal levels.
Robocalls are a Problem for Consumers and Providers of Voice Services
    USTelecom's member companies are all too aware of the increasing 
consumer frustration attributable to robocalls. Probably all of us in 
this room have experienced such calls. They are intrusive and 
disruptive. That's bad enough. But through some calls' deceptive 
pitching of phony products and services such as debt reduction programs 
and mortgage modification scams, the criminals behind these calls are 
stealing money from unsuspecting consumers. Just last month, the FTC 
filed a complaint against one robocaller targeting current and former 
U.S. military members.
    In addition to the harm they cause to consumers, robocalls impact 
USTelecom's own member companies. Often, the first call a consumer will 
make following a robocall incident is to the phone company. Our member 
companies' customer service representatives represent the first line of 
defense on this issue, and must be well versed in explaining to 
customers the difference between legal and illegal robocalls, pointing 
them to tools available to help them mitigate these calls and providing 
them with information on how to file a complaint with the FTC.
    Robocalls can also adversely impact our companies' networks. Mass-
calling events are typically highly localized, tremendously high 
volume, and extremely brief--lasting only a matter of minutes. And 
providers receive no advance warning of these calls. A severe mass-
calling event can result in service degradation and disruptions to 
phone services in a provider's impacted area. Moreover, illegal 
robocalls exacerbate an already troubling economic problem in our 
industry because they can often be associated with ``phantom 
traffic''--calls largely originating outside our companies' local 
calling areas for which a terminating access charge will never be paid 
by the long-distance carrier because the necessary call identification 
information has been stripped.
What Are Robocalls and Why Have They Proliferated?
    The proliferation of robocalls has resulted from three major 
changes in the communications marketplace. The global reach of the 
Internet, combined with the widespread availability of mass-calling 
technology and a dramatic reduction in the costs of long-distance 
service, have radically changed the capabilities and economics of 
robocalling. As former FTC Chairman Jon Leibowitz stated at last 
October's FTC-sponsored robocall workshop, the Internet has allowed 
``voice blasting technology to flourish at bargain basement prices.''
    Looked at through the lens of history, we can sympathize with the 
frustration you must feel at the apparent growth of this problem over 
the last two decades in spite of repeated legislative efforts to put an 
end to it. Those efforts illustrate the difficulty of keeping the law 
ahead of the law-breakers--and ahead of technology. The Federal Trade 
Commission (FTC), over which this Subcommittee has jurisdiction, was 
specifically directed under the Telemarketing and Consumer Fraud and 
Abuse Prevention Act of 1994 to adopt rules prohibiting deceptive and 
abusive telemarketing acts or practices, including ``unsolicited 
telephone calls which the reasonable consumer would consider coercive 
or abusive of such consumer's right to privacy.'' The body of 
regulations adopted by the FTC to implement this 1994 Act is known as 
the Telemarketing Sales Rule. The FTC is also empowered generally to 
address unfair or deceptive acts or practices in or affecting commerce, 
which the Federal Trade Commission Act declares unlawful. But the FTC's 
jurisdiction does not extend to common carriers, which are subject to 
the regulatory authority of the Federal Communications Commission 
(FCC). And for reasons described below pertaining to both our common 
carrier and privacy obligations, our member companies must complete 
phone calls.
    Viewed from the perspective of communications law, when Congress 
adopted the Telephone Consumer Protection Act of 1991 (TCPA) to address 
telemarketing robocalls, its major purposes were to protect the privacy 
and public safety interests of telephone subscribers by placing 
restrictions on automatic dialers, fax machines, and unsolicited 
automated calls. The TCPA amended Title II of the Communications Act of 
1934 to add a new section 227, entitled ``Restrictions on the Use of 
Telephone Equipment.'' The nature of the technology being used in 1991 
is well-illustrated by a consumer complaint listed among several 
examples in this Committee's report accompanying the bill (S. Rept. 
102-178): ``the automated calls filled the entire tape of an answering 
machine, preventing other callers from leaving messages.'' Except for 
amendments to expand the reach of section 227 to offshore callers and 
to prohibit caller-ID spoofing, the robocall provisions of the law 
remain largely as they were enacted in 1991--and, as we all know, they 
have become increasingly ineffective.
    The explanation for this is, regrettably, fairly simple. The 
original phone network was a ``closed'' system, meaning that voice 
services were generally provided by local exchange carriers and long 
distance companies through only the public switched telephone network 
(PSTN). These companies were providing what is called ``plain old 
telephone service,'' or POTS. When Congress passed the TCPA in 1991 to 
address robocalls, autodialing systems, and certain fax machine 
problems, and even when it acted again three years later to deal with 
unsolicited telemarketing calls, wireless communication was only 
beginning to emerge and even dial-up Internet access was not yet a 
reality for mass consumer use. In contrast to the situation that 
confronted Congress in the early 1990s, today's communications services 
are provided not by the historical closed PSTN but by a ``network of 
networks.'' *
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    \*\ To put this in further perspective, the first website was 
created in 1991--the year of the TCPA's enactment. Today, there are 
more than 30 trillion individual web pages.
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    As a result, voice service is now available from a myriad of 
companies with a diverse technical heritage. We still have the PSTN, 
but we also have Voice over Internet Protocol (VoIP) providers, 
Internet service providers, and cable companies offering ``phone'' 
service, right alongside competitive local exchange carriers and 
wireless carriers. Approximately 40 percent of U.S. households have 
``cut the cord'' and rely entirely on wireless for their voice service. 
And by the end of 2013, USTelecom estimates that more than 52 percent 
of wireline households will subscribe to interconnected VoIP, 
oftentimes provided by the local cable company. Finally, ``over-the-
top'' VoIP services--which use existing broadband networks--are widely 
available to American consumers and are offered by some of the 
country's most prominent companies, including Vonage, Google Voice, and 
Microsoft's Skype service. Skype, for example, disclosed to the 
Securities and Exchange Commission in August 2010 that the company had 
20 million connected users in the United States, 1.9 million of whom 
were paying customers.
    Regardless of their delivery platform, each of these voice 
providers must ultimately connect to the PSTN because the reliability 
of their service to their own customers depends on their ability to 
deliver any call to anywhere. As a result, ``phone'' calls can connect 
to anyone, anywhere, regardless of whether a consumer's phone is 
connected to the PSTN, or their wireline or wireless phone or computer 
is connected to a broadband network. But this same remarkable 
connectivity--a connectivity we celebrate and want to expand to those 
Americans who don't yet enjoy it--also makes it possible for 
robocalling con artists and fraudsters to set up shop virtually 
anywhere in the country or even the world and, with the right equipment 
and a few clicks of the mouse, begin auto-dialing unsuspecting and 
vulnerable consumers across the United States.
The Contextual Nature of Robocalls--What the Consumer Sees
    Now that we understand the network framework under which robocalls 
operate, it is important to understand the various types of robocalls. 
It can be helpful to consider all mass calling and robocall events as a 
traffic signal, comprised of green, yellow, and red lights. Robocalls 
that are important and legal would fall into the ``green'' category; 
robocalls that are legal, but whose usefulness are a matter of 
subjective personal opinion, would fall into the ``yellow'' category; 
and malicious and illegal robocalls would fall into the ``red'' 
category.
    So, for example, a consumer may receive a ``green'' robocall from 
his or her child's school, stating that the school's opening will be 
delayed due to bad weather. Similarly, public safety agencies will 
often use robocalls to provide critical public safety messages. For 
example, Los Angeles County has implemented an emergency mass 
notification system used by the County's Emergency Operations Center to 
notify residents and businesses of emergencies or critical situations 
and provide information regarding necessary actions, such as 
evacuations due to wildfires. Because the system uses geomapping, 
emergency notifications can be directed to very specific geographic 
areas. Clearly, robocalls of this type would fall into the ``green'' 
category.
    Robocalls falling on the ``yellow'' spectrum are also legal, 
although some recipients might be indifferent to their messages or 
might prefer not to receive them. A doctor's office may use a robocall 
to remind a patient of an upcoming appointment. Similarly, political 
candidates and political groups will often use robocalls to solicit 
votes in an upcoming election, or to deliver an advocacy message.
    Finally, there are the instances of illegal calls falling into the 
``red'' category of calling events. These calls include the infamous 
``Rachel from Card Services,'' as well as other bogus schemes selling 
everything from cruises to insurance. Robocallers are becoming 
increasingly creative in perpetrating their scams, many of which 
originate from beyond our Nation's borders.
    The traffic from a robocaller directed toward a consumer on the 
PSTN can transit the network either over the Internet, or through the 
PSTN itself. In fact, it is usually the case that a typical mass-
calling event will transit multiple networks--encompassing both the 
PSTN and the Internet--before finally reaching the consumer.
The Contextual Nature of Robocalls--What the Service Provider Sees
    Consumers are the only ones who can ultimately determine the nature 
of any specific robocall. Service providers, conversely, have no 
visibility into the specific nature or type of robocall transiting 
their network. They have no way of determining whether the call is 
illegal or legal. The service provider may only see that a mass calling 
event is taking place at a specific point on their network.
    From the service provider's perspective, these mass calling events 
are defined by four characteristics. First, they are highly localized 
in nature. Second, they are represented by a high volume of calls. 
Third, once the calls arrive at their intended local target, they are 
extremely brief--potentially only lasting a matter of seconds or 
minutes. Finally, there is no advance warning for these calls.
    Adding further complexity to the robocall issue is the problem of 
caller-ID spoofing--misrepresenting one's identity using a deceptive 
caller-ID. Although, after the fact, providers have investigative 
techniques that can positively identify whether a call has been spoofed 
or not, there is no way for a carrier to make that determination in 
real time, as the call is transiting the network.
Significant Legal Constraints Limit Potential Robocall Deterrents
    Two primary legal issues face USTelecom's member companies with 
respect to remedying the robocall problem. First, under existing laws 
to which USTelecom's members are subject for their provision of legacy 
voice service, phone companies have a legal obligation to complete 
phone calls. These companies may not block or otherwise prevent phone 
calls from transiting their networks or completing such calls. The 
current legal framework simply does not allow our companies to decide 
for the consumer which calls should be allowed to go through and which 
should be blocked.
    Second, there are substantial privacy issues that arise in any 
discussion relating to proposed robocall solutions. Robocalls are 
extremely contextual in nature. Depending on the nature of the call, 
certain robocalls are permitted under the law, while others are 
prohibited. Proposed solutions to the robocall dilemma that seek to 
make phone service providers the arbiter of whether a call should--or 
should not--be permitted to proceed skirt dangerously close to 
violating the privacy obligations imposed on us by law. For example, 
the Wiretap Act (also known as Title I of the Electronic Communications 
Privacy Act (ECPA) or Title III of the Omnibus Crime Control and Safe 
Streets Act of 1968) expressly protects wire, oral, and electronic 
communications while in transit and establishes that service providers 
are permitted to intercept those communications only as a necessary 
incident to the rendition of service or to the protection of the rights 
or property of the provider. Similarly, except as authorized by ECPA, 
section 705 of the Communications Act of 1934 makes it a crime for any 
person ``to intercept and divulge or publish the contents of wire and 
radio communications''--a provision not limited solely to common 
carriers.
The Practical Realities of Technological and Legislative Solutions
    The interdependent, interconnected, and global nature of the 
Internet means that areas of vulnerability exist throughout the 
network, and therefore cannot be realistically addressed by any single 
stakeholder. Given the rapid and ever-changing nature of the robocall 
problem, it is highly unlikely that a technological ``silver bullet'' 
can be developed as a permanent solution. Much in the same way that 
remediation efforts in areas such as spam or cybersecurity must 
continually evolve, the same can be expected for robocalls.
    Robocalls, like their brethren in the area of spam, phishing, and 
cybersecurity is a constantly evolving problem. USTelecom supports the 
development of possible technological solutions to the robocall problem 
by stakeholders throughout the Internet ecosystem, most of whom are not 
constrained by the significant legal limitations currently facing our 
members. But members of this Subcommittee need to be aware that no 
single solution will permanently address the robocall problem. Today's 
solution could very well turn into tomorrow's Maginot Line, and could 
have unintended adverse consequences.
    For example, solutions that rely extensively on blocking calls 
populated by a blacklist could very well result in the blocking of 
legitimate calls from callers whose own phone numbers have been 
illegally spoofed. Conversely, solutions implementing call blocking 
features based upon a whitelist could potentially block an important--
albeit unexpected--message from a legitimate caller. Even more 
perversely, the availability of spoofing technology can easily fool 
consumers into taking calls they should avoid. For example, spoofing 
the number of the local municipal hospital could dupe a senior citizen 
into believing that a fraudulent effort to sell phony medical products 
is actually a legitimate call from a whitelisted number. Given the open 
nature of the broadband network, technological solutions can be--and 
often are--superseded by technological countermeasures.
    The same increasingly appears to be the case for legislative and 
regulatory solutions, which regrettably do not seem capable of keeping 
pace with the evil genius of scammers who continually invent new ways 
of evading discovery and capture, much less prosecution and punishment. 
As noted earlier, we have been trying to legislate out of existence the 
problems of robocalling, spam, autodialing, and caller-ID spoofing for 
as long as two decades, but new technologies only seem to make the 
problems grow worse.
Addressing Robocalling Requires A Multi-Pronged Approach
    This is not to say that carriers are passive observers to the 
robocall problem. USTelecom's member companies work on multiple fronts 
in order to monitor, mitigate, and respond to mass-calling events. For 
example, many USTelecom member companies maintain network operations 
centers (NOCs), which include 24-hour security desks that monitor 
network traffic, respond to consumer complaints, conduct traffic data 
forensics, and initiate mass calling investigations.
    In addition, carriers are providing--and will continue to develop--
various services consumers can use to help mitigate the robocall 
problem. These services include basic caller-ID functionality, as well 
as conditional call-forwarding and anonymous call-blocking. Because the 
offerings and capabilities of companies are different, consumers are 
always encouraged to contact their respective service provider in order 
to identify available resources.
    Network operators also work within the framework of various 
standards setting groups, the best example of which is the Alliance for 
Telecommunications Industry Solutions (ATIS). ATIS is a standards 
organization that develops technical and operational standards for the 
communications industry, including standards related to the handling of 
mass-calling events. In addition, several USTelecom member companies 
are members of the Communications Fraud Control Association (CFCA). 
CFCA's membership consists of approximately 200 different carriers, 
private network owners, end users, law enforcement officers, and others 
from around the world. Through these public-private partnerships, 
industry stakeholders work together to identify best practices and 
solutions to a broad range of telecommunications-related issues, 
including robocalls.
    Carriers will initiate legal actions against robocallers when they 
can be found and coordinate with law enforcement agencies at the state 
and Federal level during ongoing investigations and enforcement 
actions. For example, in a 2010 FTC action against a robocaller that 
allegedly made more than 370 million calls to consumers nationwide in a 
single year, the agency specifically acknowledged the assistance that 
both AT&T and Verizon provided in the investigation of the case.
    Finally, the competition between our companies and other 
communications platforms for consumer and enterprise business provides 
incentives for all communications providers to innovate and to develop 
new and more effective solutions to challenges such as robocalling. 
This competition requires us to offer consumers the best possible 
experience subject to what the law allows us to do, including taking 
action to mitigate robocalling. If we do not offer effective solutions, 
consumers will simply migrate to alternate technologies that offer 
better ones.
    In closing, let me again thank the Subcommittee for holding this 
timely hearing. We share both the consumer's and Subcommittee's 
frustration with the issue, and we look forward to our continued work 
together in a manner that provides flexibility in addressing this 
constantly evolving challenge.

    Senator McCaskill. Thank you, Mr. Rupy.
    And I am going to interrupt here for a moment. We have been 
joined by Senator Pryor. And this is a subcommittee that really 
has overlapping jurisdiction with Senator Pryor's subcommittee 
on telecommunications. And so I would like to defer to him for 
a moment.
    If you would like to make any comments at this point, 
Senator Pryor, before we continue with this panel, that would 
be terrific.
    Thank you for joining us today. Between Consumer Protection 
and your committee--and I know you were the former chairman of 
this subcommittee, so I really appreciate you cooperating with 
us and allowing us to have this hearing even though we could 
argue about the jurisdiction, which we do around here 
sometimes, I have noticed.
    [Laughter.]

                 STATEMENT OF HON. MARK PRYOR, 
                   U.S. SENATOR FROM ARKANSAS

    Senator Pryor. That is OK. No, I am thrilled that you are 
chairing this subcommittee now. It is a great subcommittee, as 
you know, great staff and a great team of people here. But 
thank you.
    Let me just say, we have a great leader in Chairwoman 
McCaskill. She is going to do great things with this 
subcommittee.
    And these are very important issues that you are talking 
about today. And we may have had some overlapping jurisdiction, 
but I don't care, because I think that you are going to handle 
this hearing just great. And I just want to say thank you for 
your hard work, and I want to say thank you to all the 
Subcommittee members.
    You know, I look at the numbers; it is clear that the Do 
Not Call Registry has been a success. And I am pleased that the 
FTC is working with states to crack down on the individuals 
with robocalls and other illegal activities.
    So everybody is working together; we can solve this. So all 
I want to say is thank you. And I didn't want to interrupt, but 
thank you.
    Senator McCaskill. Thank you, Senator Pryor.
    Mr. Altschul?

               STATEMENT OF MICHAEL F. ALTSCHUL,

           SENIOR VICE PRESIDENT AND GENERAL COUNSEL,

                CTIA--THE WIRELESS ASSOCIATION

    Mr. Altschul. Good morning, Chairman McCaskill, Ranking 
Member Heller, and Senator Pryor. On behalf of CTIA, thank you 
for the opportunity to participate in this morning's hearing to 
explore ways to protect consumers against unlawful robocalls 
and SMS text messages.
    CTIA was proud to support initial adoption of the Telephone 
Consumer Protection Act back in 1991. In fact, I had just 
joined the association; it was one of the first legislative 
issues I worked on.
    Like our customers, wireless carriers are also victims of 
illegal text message phishing scams and robocall campaigns by 
unscrupulous boiler-room operators seeking to sell extended car 
warranties and the like that violate the protections in the 
TCPA and other laws.
    That is why CTIA has called on the FCC to change the way it 
reports TCPA complaints, which, as you may know, are divided 
into wireless complaints and wireline complaints. These 
consumer complaints are about calls and messages that originate 
outside of a carrier's network and control. And the way the FCC 
reports them actually tends to hide the magnitude of the 
problem in their reports.
    CTIA and our member companies understand consumer annoyance 
over these calls and repeatedly have pledged our full 
cooperation to efforts by the FCC and the FTC to bring 
enforcement actions against robocallers and fraudsters who 
violate the TCPA.
    In cases where they can locate and identify the source of 
the messages, our carrier members have brought lawsuits against 
the perpetrators. And the industry has cooperated with the FTC 
and state attorneys generals in their investigation and 
prosecution of these cases.
    However, as you have heard from other witnesses, it is 
virtually impossible to trace an interconnected VoIP call or an 
over-the-top text message delivered to a wireless carrier from 
the Internet, especially when the sender wants to disguise his 
or her identity through the use of proxy servers and spoofed 
caller ID.
    I would like to use a screenshot of a text message that I 
received on Monday to illustrate the difficulties we face in 
trying to solve this problem.
    And, by the way, wireless carriers do screen text messages 
and successfully block millions of them, I believe, every day. 
Voice calls have to be found at the source to be cut off.
    As you can see, this text message appears to be an 
informational text message about my account at a local 
financial institution. In fact, I have provided my express 
prior consent to the financial institutions where I have 
accounts, authorizing them to send me informational text 
message alerts about fraudulent activity, data breaches, and 
other time-sensitive account information.
    But since I do not have an account at this institution, I 
knew immediately it was a phishing scam that violates both the 
TCPA and the Truth in Caller ID Act, which prohibits the 
spoofing of caller IDs. Scammers, especially those outside of 
the United States, are not deterred from violating the TCPA or 
the Caller ID Act.
    For this phishing scam, the fraudster spoofed the caller ID 
of a local Washington, D.C., phone number. As it turns out, 
this number is not in service. It happens to be assigned and 
arranged so that it is assigned to a CLEC. But I called it and 
got a recording that the number is not service. So this is not 
a real phone number assigned to a user.
    But the fraudster could just as easily spoof the financial 
institution's actual phone number or tumbled phone numbers 
randomly to defeat the use of blacklists and whitelists. And 
this is why this is such a difficult problem to solve. Carriers 
do not know the businesses and public agencies the customer has 
given express prior consent to send informational calls and 
messages. And even if a carrier did know this information, 
fraudsters can spoof whitelisted numbers and appear to be a 
legitimate business sending informational calls and messages to 
its customers.
    We appreciate the efforts of the FTC and others who are 
exploring technologies that may minimize the transmission of 
illegal robocalls and text messages to our customers. However, 
as H.L. Mencken famously observed, there is always a well-known 
solution to every human problem neat, plausible, and wrong. 
This wise counsel cautions us that any technical solutions must 
be subject to careful and complete consideration.
    So, on behalf of CTIA, thank you for your consideration of 
these suggestions. We look forward to working with you to 
address these and related matters as the Subcommittee moves 
forward.
    [The prepared statement of Mr. Altschul follows:]

  Prepared Statement of Michael Altschul, General Counsel, CTIA--The 
                         Wireless Association
    Good morning Chairman McCaskill, Ranking Member Heller, and members 
of the Subcommittee. On behalf of CTIA--The Wireless Association, 
thank you for the opportunity to participate in this morning's hearing 
to explore ways to protect consumers against unlawful robocalls.
    Like our customers, wireless carriers are also victims of robocall 
campaigns by unscrupulous ``boiler-room'' operators seeking to sell 
extended car warranties and the like that violate the protections in 
the Telephone Consumer Protection Act (TCPA). At CTIA, we and our 
members understand consumer annoyance over these calls and repeatedly 
have pledged our full cooperation to efforts by the FCC and the FTC to 
bring enforcement action against these serial violators of the TCPA. In 
cases where they can locate and identify the source of these messages, 
our carrier members have vigorously brought suit against the 
perpetrators, and the industry has cooperated with the FTC in its 
investigation and prosecution of TCPA cases.
    CTIA was proud to support initial adoption of the Telephone 
Consumer Protection Act in 1991. At that time, there were roughly seven 
million wireless subscribers in America, and nearly every wireless 
subscriber also had a landline phone. Today, there are more than 326 
million wireless subscriber connections in the United States, including 
connections for advanced communications devices like smartphones and 
tablets that access increasingly ubiquitous wireless broadband 
services. The U.S. wireless industry now leads the world in delivering 
next generation wireless services. Wireless has evolved from a niche 
voice service to the primary source of broadband communications for 
millions of Americans. Consumers' mass migration to wireless-only 
service also is a testament to the attractiveness of wireless prices. 
According to the Bureau of Labor Statistics' Wireless Price Index, the 
effective monthly cost of wireless service to consumers has fallen more 
than 40 percent since December 1997.
    At the same time, because of the real reduction in the price of a 
wireless call, the popularity of rates plans that offer ``buckets'' of 
minutes and unlimited calling on nights and weekends, innovative 
devices and applications, and the added convenience that wireless 
offers to consumers who value personal and untethered communications, a 
substantial portion of the population has moved or is moving to ``cut 
the cord'' and rely completely on their wireless phones as their only 
means of communication. Currently more than 35 percent of U.S. 
households are ``wireless only'' for their voice service, and the 
percentage is significantly higher in some regions and among certain 
segments of the population.
    Of particular significance for today's hearing, the continuing 
trend to adoption of wireless service as the primary source of 
communications for millions of Americans, and the changes that have 
flowed from innovative rate plans and the greater affordability of 
wireless service, justify a fresh look at the TCPA's treatment of pre-
recorded calls to mobile devices.
    For instance, given the shift in the way consumers use their mobile 
devices the TCPA's disparate treatment of informational calls that 
depends upon whether a company is calling a wireline or wireless phone 
number--or, increasingly, a number associated with an interconnected 
VOIP provider that simultaneously forwards the call to a customer's 
wireline and wireless numbers--is increasingly out of date. As 
currently enacted, the TCPA requires the ``prior express consent'' of 
the called party for even informational calls to wireless phones if the 
calls are prerecorded or use an autodialer; non-commercial 
informational calls to residential phones are not similarly restricted. 
This disparity creates challenges for companies and government agencies 
that want to provide legitimate informational calls to individuals who 
are not reachable in any other way and who may value such calls to 
receive timely information such as notification about a data breach, 
fraud alert, change in flight time, or other time-sensitive account 
information.
    Even where a consumer has given prior express consent to one entity 
to receive autodialed calls on her mobile device, that consent would 
not apply to informational calls from other entities about that 
purchase. For example, I may have given LL Bean consent to call me on 
my cell phone when I ordered a new shirt, but that would not permit UPS 
to notify me about scheduled delivery times. Similarly, I may have 
given the auto dealership consent to call my cell phone when I 
purchased my car, but that consent may not extend to the auto 
manufacturer that wants to later call me about a safety recall.
    A key adjustment to the TCPA that would help resolve this issue 
would be clarification of the statutory definition of an ``automatic 
telephone dialing system'' (ATDS), at least as it applies to delivery 
of informational calls. The TCPA defines an ATDS as ``equipment which 
has the capacity to store or produce telephone numbers to be called, 
using a random or sequential number generator'' and the ability ``to 
dial such numbers.'' The Federal Communications Commission and some 
courts have interpreted this definition to include equipment that dials 
numbers from a list of customer phone numbers that are neither random 
nor sequential. The equipment simply aids the calling party by 
automating the process of dialing these intentionally selected numbers. 
This expansive interpretation potentially leaves wireless customers 
unable to receive desirable informational messages, like a fraud alert 
from their bank, while there remain no restrictions on sending the same 
alert message to the dwindling number of consumers that maintain a 
landline phone. A welcome clarification to the TCPA would allow use of 
ATDS to send informational messages to wireless phones, so long as they 
are not used to dial numbers sequentially or randomly.
    Another outmoded aspect of TCPA implementation is the fact that the 
Federal Communications Commission continues to catalog consumers' TCPA 
reports as ``wireless complaints,'' suggesting they are complaints 
about wireless service, when the complaints are in fact about 
violations of the TCPA and FCC rules by telemarketers calling consumers 
on their wireless phones. As I noted at the outset, wireless carriers 
have taken numerous steps--including bringing lawsuits against 
robocallers--to protect their customers against unlawful calling 
campaigns. At CTIA, we understand consumer annoyance over these calls 
and repeatedly have pledged our full cooperation to efforts by the FCC 
and the FTC to bring enforcement action against these serial violators 
of the TCPA.
    Yet while wireless carriers are doing what they can to identify and 
shut down TCPA violations, the FCC continues to misleadingly catalog 
consumers' TCPA reports as ``wireless complaints.'' We believe it is 
unfair for the FCC to continue to count TCPA complaints, which are 
about calls that originate outside of the wireless network and have 
nothing to do with wireless carriers' behavior, as ``wireless 
complaints.'' The FCC's refusal to properly characterize these consumer 
complaints significantly and misleadingly expands the apparent rate of 
consumer complaints about wireless services. This is important since 
absent inclusion of TCPA-related complaints, the total number of 
complaints about wireless service received by the FCC has been 
declining significantly, dropping from 12/1000ths of one percent of 
industry subscribership in 2005 to slightly more than 7/1000ths of one 
percent today. To ensure accurate reporting, we believe the FCC should 
disaggregate TCPA data from its quarterly and annual wireless complaint 
data and report it separately.
    Let me turn now to the question of whether technical solutions can 
help address the problem of unlawful robocalls. While the recent effort 
by the FTC to use a contest to identify a technical solution that would 
allow consumers to automatically screen and reject unwanted robocalls 
produced some interesting proposals, the limited information available 
to CTIA and the public about these proposals suggests the FTC and 
others should approach implementation cautiously.
    Each of the three winning entries in the contest, including one 
submitted by two engineers at Google, relies on creation of a 
``blacklist'' database of numbers identified as associated with 
robocall spammers. All incoming calls to a consumer would be compared 
with this database, with calls from blacklisted numbers blocked. The 
database would also include a ``whitelist'' of numbers associated with 
entities that have been identified as associated with ``legitimate'' 
callers. While there may be value to these solutions, they raise a 
number of issues that would need to be resolved before any such system 
can even be considered for implementation.

   Identification of Blacklist Numbers. Each of the proposed 
        systems includes a method for identifying numbers to be 
        included on the blacklist--some using consumer input and at 
        least one using a mathematical algorithm. But there are 
        significant issues with either method. Given the ease with 
        which robocallers using modern equipment can mimic the caller 
        ID of any other phone user, a consumer or an algorithm may 
        think it is identifying an illegal robocaller for the 
        blacklist, when it is actually listing the number of an 
        innocent party. Illegal robocallers can also change the numbers 
        they use (or the numbers they mimic) frequently--even 
        ``tumbling'' a new legitimate number for each individual 
        robocall--limiting the usefulness of the blacklist. This 
        suggests a need to contact the person or business associated 
        with the number in order to provide an opportunity to object to 
        being placed on the blacklist. Would there be an appeal 
        process? Would there be criteria for moving an innocent 
        customer from the blacklist to the whitelist? In addition, one 
        person's unwanted annoying robocall may be another person's 
        important informational message. One consumer may suggest 
        adding a political candidate's number to the blacklist because 
        he or she is annoyed with the candidate's message, while others 
        may welcome such messages. It is unclear how an algorithm could 
        even distinguish between wanted and unwanted robocalls.

   Identification of Whitelist Numbers. Before implementation, 
        rules would need to be worked out and a system administrator 
        appointed to determine how, and on what basis, a robocaller 
        could get its number added to the whitelist. Would there be an 
        appeal process? What would be the criteria for moving a bad 
        actor from the whitelist to the blacklist?

   Caller ID Spoofing. Even assuming an accurate database of 
        blacklisted and whitelisted numbers can be compiled and 
        maintained, the ease with which modern equipment and software 
        can allow a caller to hide its identity by spoofing a caller ID 
        would present significant challenges. It would, for example, be 
        relatively simple for an illegal robocall spammer to spoof one 
        or more of the numbers on the whitelist to get its calls 
        through the protection system. While the Truth in Caller ID Act 
        prohibits spoofing of caller IDs for fraudulent or harmful 
        purposes, unlawful robocallers--especially those that are 
        calling from outside the United States--that aren't deterred 
        from violating the TCPA would likely have little concern about 
        also violating the caller ID law. Identifying illegal 
        robocallers that are spoofing caller ID is made significantly 
        more difficult if the robocaller uses modern Voice over 
        Internet Protocol (VOIP) technology, which if routed through a 
        proxy server becomes virtually impossible to trace.

   Scaling. Because unlawful robocallers typically use a large 
        number of telephone numbers and change telephone numbers 
        frequently, the database for the blacklist would be very large 
        and continually growing, requiring a significant investment for 
        both acquisition and maintenance of computer resources. Perhaps 
        more significantly, the capacity in both telecommunications and 
        computer resources needed to route to the database for 
        comparison all of the calls robocallers may make to the tens or 
        even hundreds of millions of persons who may sign up for the 
        service would be massive.

   Administration and Operation of the System. Any robocall 
        blocking system of the type proposed in the FTC contest would 
        involve a fairly massive administrative and operational effort. 
        It should not be expected that carriers can be the implementing 
        entities. The significant costs of the system aside, a single 
        carrier could reasonably compile and maintain a robocall 
        blacklist that would be associated only with the illegal 
        robocall identification and calling preferences of its own 
        customers. Thus no system operated by a single carrier could be 
        as comprehensive as it would need to be to be effective. In 
        addition, wireless carriers, as legal common carriers, must 
        deliver calls that are placed on their networks. While a 
        subscriber that opted in to the proposed robocall blocking 
        system may be considered to have authorized the blocking, the 
        carrier may not block calls from a legal robocaller on its 
        network, absent specific statutory or regulatory authority to 
        do so.

   Privacy Issues. At least one reported robocall solution 
        would require the carrier to allow the solution administrator 
        to screen subscribers' incoming calls to determine whether they 
        are from an illegal robocaller or a legal robocaller or live 
        individual. Even if this kind of snooping is authorized by the 
        recipient of the call, such a potentially invasive technology 
        raises serious questions about consistency with the law and 
        rules governing the privacy of customer proprietary network 
        information and a carrier's traditional responsibility to avoid 
        intercepting or divulging the content of communications other 
        than in narrowly circumscribed instances.

    We appreciate the efforts of the FTC and others who are exploring 
technologies that may minimize the transmission of illegal robocalls to 
our customers. As the foregoing suggests, however, any technical 
solutions must be subject to careful and complete consideration. 
Particularly at this early stage of development, it would be premature 
to impose any technical solution as a mandate.
    Finally, whether as part of a technical solution to robocalls or as 
part of any amendment to the TCPA, nothing should be done to upset the 
FCC's longstanding conclusion under the TCPA that wireless carriers 
need not obtain additional consent from subscribers prior to initiating 
autodialed calls at no cost to their subscribers. These important and 
beneficial customer service calls may be used to notify customers of 
billing alerts, low balance alerts on prepaid phones, and usage alerts 
informing customers of approaching limits for voice, data, or messaging 
plans. In encouraging wireless carriers to provide this information to 
their customers, the FCC has consistently recognized the benefits of 
such calls between wireless carriers and their customers and recognized 
that Congress had no intention of hindering these communications. Any 
new solution to illegal robocalling, whether technical or through 
increased enforcement, should not upset this key communication between 
wireless providers and their customers.
    On behalf of CTIA, thank you for your consideration of these 
suggestions. We look forward to working with you to address these and 
related matters as the Subcommittee moves forward with its work.

    Senator McCaskill. Thank you very much.
    Mr. Stein?

 STATEMENT OF MATTHEW STEIN, CHIEF TECHNOLOGY OFFICER, PRIMUS 
                    TELECOMMUNICATIONS INC.

    Mr. Stein. Thank you, Chair, Ranking Member Heller, and 
Senator Pryor. My name is Matthew Stein, and I am the Chief 
Technology Officer of Primus Telecommunications. While my 
responsibilities at Primus cover all of our technology assets 
globally, my comments today are specific to our Canadian 
business, known as Primus Canada.
    As in the United States, robocalls are a concern in Canada, 
and I thank you for the opportunity to speak to a technological 
solution invented, developed, and deployed by Primus.
    Primus provides a service called Telemarketing Guard to all 
of our telephone customers in Canada. This patented service was 
developed and deployed in 2007 in response to our customers' 
discontent with their inability to control unlimited, 
unsolicited calling.
    The concerns expressed by our customers are familiar: 
unwanted calls interrupting dinner, interrupting quiet 
evenings, interrupting family time, and, in many cases, the 
inability to make these calls stop, no matter how many times 
the customer asked to be taken off one kind of list or to be 
put on another.
    Before I proceed, it is important to make clear that we 
view robocalls and automated telemarketing calls as a subset of 
mass unsolicited calling, which, for convenience, I will refer 
to as ``telemarketing.'' Our customers have made clear that 
their view of telemarketing does not change if they are greeted 
by a live person or a recorded message when they pick up the 
phone.
    Telemarketing Guard addresses this issue by providing 
customers with control over how they wish to deal with 
telemarketing calls. When a call is placed to a customer 
protected by it, our system evaluates the call even before the 
phone has rung. If the system believes, based on feedback 
provided through our customers, that the caller is likely a 
telemarketer, the call does not go directly to our customer. 
Instead, a message is played telling the caller that the 
customer does not accept telemarketing calls and invites them 
to press ``1'' to record their name so that their call can be 
announced. The customer then has the choice to accept the call, 
refuse the call, or send it to voice-mail, all without actually 
speaking to a telemarketer.
    Telemarketing Guard uses the actions of our customers to 
identify these telemarketing calls. The system is completely 
neutral to all phone numbers until a report from a customer is 
received. As a result, all calls, telemarketing or not, are 
unimpeded to our customers initially. But if a customer 
receives an unscreened telemarketing call, it is up to them to 
decide whether or not they will choose to report that number, 
which they can do by picking up their phone and dialing a 
special code.
    If they choose to report the call and if a threshold of 
other customers also reports that call, the system begins to 
monitor the phone number and scans for a number of behavioral 
characteristics. For example, these could be frequency of 
calling, time-of-day concentration, sequential calling, and so 
on. There are many, many other elements that are scanned for. 
All of this is done to determine if the call should be 
identified as a telemarketer on a go-forward basis.
    In essence, the system promotes and relies on customer 
engagement to identify telemarketing calls. But the reverse is 
also true. If enough customers accept a call from an identified 
telemarketer, the number will cease to be considered a 
telemarketer by the system.
    This is accomplished by a system that requires no arduous 
maintenance of lists or complicated judgment calls to be made, 
whether by network providers, by third parties, or government 
bodies. Instead, the system just tallies customer votes to 
determine who is and who is not an unwanted telemarketer. In 
other words, it becomes a living, breathing, crowdsourced list 
of undesirable telemarketers and robocallers.
    Further, customers that don't even bother to participate in 
reporting still benefit from the actions of those that do. This 
is the defining element of Telemarketing Guard and what we 
believe makes it unique. In fact, this is what led us to patent 
this system.
    Customer engagement and response have been exceptional. 
Based on our internal surveys, the service has increased 
customer satisfaction and become one of the leading reasons 
customers choose to keep their phone service with Primus.
    In regards to costs and implementation, the system is not 
complicated or expensive to establish and maintain. Indeed, we 
currently provide Telemarketing Guard to all of our customers 
at no extra charge. The system can also be grafted easily into 
existing phone networks, as we did into ours. It can work for 
traditional landline phones, Voice-over-IP phones, or mobile 
phones. The service doesn't require customers to buy anything 
or install anything or configure their phone in certain ways. 
And, finally, the service itself can be adapted and configured 
to address needs of consumers, telephone service providers, or 
legislative and regulatory bodies.
    In conclusion, besides being a powerful consumer tool, we 
believe that Telemarketing Guard is consistent with the 
competitive interests of telecommunications carriers to provide 
valuable new services to customers. Primus therefore welcomes 
the efforts of this committee to identify ways that consumers 
can be given more tools to address mass unsolicited calls and 
to encourage carriers to provide such services.
    Thank you, and I look forward to any questions you may 
have.
    [The prepared statement of Mr. Stein follows:]

    Prepared Statement of Matthew Stein, Chief Technology Officer, 
                     Primus Telecommunications Inc.
    Thank you Chair and distinguished members of the Committee. My name 
is Matthew Stein, and I am the Chief Technology Officer of Primus 
Telecommunications Inc. While my responsibilities at Primus cover all 
of our technology assets globally, my comments today are specific to 
our Canadian business, known as Primus Canada. As in the United States, 
robocalls are a similar concern in Canada and I thank you for the 
opportunity to speak to a technological solution invented, developed, 
and deployed by Primus to assist our customers with this issue.
    Primus provides a service called Telemarketing Guard to all of our 
telephone customers in Canada. This patented service was invented in 
2006, and deployed in 2007 in direct response to our customers' 
discontent with their inability to control and limit unsolicited calls. 
The concerns expressed by our customers are familiar--unwanted calls 
interrupting dinner, interrupting quiet evenings, interrupting family 
time and, in many cases, the inability to make the calls stop no matter 
how many times the customer asks to be taken off one kind of list or 
put on another.
    Before I proceed, it is important to make clear that we view 
robocalls and automated telemarketing calls as a subset of mass 
unsolicited calling, which for convenience I will generally refer to as 
telemarketing calls throughout my presentation. Our customers have made 
clear that their view of telemarketing calls does not change if they 
are greeted by a live person or a recorded message when they pick up 
the phone.
    Telemarketing Guard addresses this issue by providing customers 
with control over how they wish to deal with telemarketing calls. When 
a call is placed to a customer protected by Telemarketing Guard, our 
system evaluates the call even before the customer's phone is rung. If 
the system believes, based on feedback provided by our customers, that 
the caller is likely a telemarketer, the call does not go directly to 
our customer. Instead, a message is played advising the caller that the 
customer does not accept telemarketing calls and invites them to press 
1 to record their name, so that their call can be announced to the 
party they are calling. After the caller records their name, similar to 
leaving a voice-mail, the system calls our customer and advises them 
that they have received a potential telemarketing call and plays the 
recording provided by the caller. The customer then has the choice to 
accept the call, refuse the call, or send the call to voice-mail if 
available. In fact, customers often decide to ignore the call 
altogether without even having to answer the phone as the caller ID 
will display the name ``Telemarketing Guard'' along with the original 
caller's phone number.
    Telemarketing Guard uses the actions of our customers to identify 
potential telemarketing calls. The system is completely neutral to all 
calling telephone numbers until a report from a customer is received. 
As a result, all calls--telemarketing and non--will initially proceed 
completely unimpeded to our customers. If a customer receives an 
unscreened telemarketing call, it is up to them to decide whether or 
not to report the number, which they can do through their phone. If 
they choose to report the call and if a threshold of customers 
reporting the same number is reached, the system then begins to monitor 
the calling phone number and applies a number of behavioural 
characteristics (e.g., frequency of calling, time of day concentration, 
sequential calling, etc.) to determine whether the call should be 
identified as a telemarketing call on a going forward basis.
    In essence, the system promotes and relies on customer engagement 
to identify potential telemarketing calls. The reverse is also true. If 
enough customers accept a call from an identified telemarketer, the 
number will cease to be considered a telemarketer by the system. 
Several other safeguards are employed by the system to ensure that 
calling numbers are not erroneously identified.
    Customer engagement and response has been exceptional. Based on our 
internal surveys, the service has increased customer satisfaction and 
become one of the leading reasons that customers choose to keep their 
phone service with Primus. In fact, few customers have selected to 
disable the service.
    In regards to costs and implementation, the system is not overly 
complicated or expensive to establish and maintain. For its part, 
Primus currently provides Telemarketing Guard to all of its telephone 
customers at no extra charge. The system can also be easily grafted 
into an existing network and deployed, such as we did. It can work for 
traditional land line phones, voice-over-IP phones, or mobile phones, 
if the Service Provider so configures it. The service does not require 
customers to purchase or install any equipment or software whatsoever, 
nor does it require customers to actively participate in reporting in 
order to benefit from the reports of other customers. Additionally, the 
service itself can be adapted and configured to address specific needs 
of customers, telephone service providers or legislative and regulatory 
bodies.
    In addition to being a powerful consumer tool, we believe that 
Telemarketing Guard is consistent with the competitive interest of 
telecommunications carriers to provide valuable services to customers. 
Primus therefore welcomes the effort of the Subcommittee to identify 
for consumers a way that they can be equipped with the means to address 
unsolicited calls and to encourage carriers to offer services that 
provide such tools to customers.
    Thank you and I look forward to any questions that you may have.

    Senator McCaskill. Thank you very much. We appreciate you 
being here.
    Mr. Foss?

STATEMENT OF AARON FOSS, FREELANCE SOFTWARE DEVELOPER, NOMOROBO

    Mr. Foss. Thank you, Chairman McCaskill, Ranking Member 
Heller, and Senator Pryor. I appreciate this opportunity to 
testify.
    And I am here today to illustrate that the technology 
exists right now to block these illegal robocalls. And while 
there are some challenges, such as caller ID spoofing and 
privacy concerns, there are also effective solutions.
    And to that end, there are three main points that I want to 
discuss. First, I am going to talk about my winning FTC 
Robocall Challenge entry. Then I will discuss some issues and 
concerns that are involved with blocking robocalls. And, 
finally, I am going to discuss the commercial viability of 
robocall-blocking services.
    So, currently, the Do Not Call Registry is almost 
completely ineffective against these illegal mass-dialed 
robocallers. So to fight back, the FTC launched a competition 
to find new and creative solutions to this problem. They chose 
my proposal, which I call Nomorobo, as one of the co-winners. 
And that is a little play on ``no mo' '' robocalls.
    So in real-time--well, here is how----
    Senator McCaskill. Even we got that.
    [Laughter.]
    Mr. Foss. Great. Just making sure. Just making sure.
    [Laughter.]
    Senator McCaskill. Just to reassure you. I know the rest of 
the country thinks we are idiots, but we got that. [Laughter.]
    Mr. Foss. Just making sure.
    So here is how it works. In real-time, Nomorobo analyzes 
the incoming caller ID and the call frequency across multiple 
phone lines, and if it detects a robocaller, the call is 
automatically disconnected. And all of this happens before the 
consumer's phone rings.
    So as each call is analyzed, a blacklist of robocallers is 
continually updated. And the more calls that come into the 
system for analysis, the better that the algorithm works.
    I actually built this system using the same technology that 
these robocallers are using, so it scales inexpensively to 
handle millions of calls. And Nomorobo works on landlines, 
voice-over-IP, and cell phones on all of the major carriers and 
does not require any additional hardware or software. All that 
is required by the consumer is a simple, one-time setup to 
enable a free feature that is already built into the switches 
called ``simultaneous ring.''
    But, as with all new ideas, there is always some 
skepticism. Industry players have expressed three major 
concerns about robocall blocking: spoofing caller ID; violating 
consumer privacy; and allowing legal robocalls.
    So it is incredibly easy to spoof caller ID to show any 
phone number, and almost all of the robocallers do that. But 
while you can falsify the calling number, you can't falsify the 
calling patterns. So it is a red flag, for example, when the 
same number, whether it is spoofed or not, has made 5,000 calls 
to different numbers in the past hour. And it is also a red 
flag when the same number is sequentially calling large blocks 
of phone numbers. Both of these scenarios indicate robocalling 
patterns.
    And so a static blacklist of known robocallers would only 
work in a very limited amount of situations. But by combining 
the caller ID, whether it is real or faked, with real-time 
calling pattern analysis, robocalls can effectively be 
detected.
    And, also, with solutions like these that only look at the 
metadata of a call, there is no need to monitor or listen in to 
the phone calls, thus assuring customer privacy. The caller ID 
data, along with the date and time, across many phone lines, 
gives enough of a fingerprint to detect robocallers without 
having to analyze the actual content of the call.
    And the final concern that has been raised is how to allow 
legal robocalls, such as schools and emergency notifications, 
to bypass robocall blocking. And this can be accomplished by 
building a trusted, real-time whitelist. I have already had the 
opportunity to speak with some of the legal robocallers, and 
they are very open to working on a solution that allows them to 
successfully deliver their calls. They want these illegal 
robocallers put out of business as much as the consumer does.
    As my final point, I would like to show that there is proof 
of consumer demand for this type of service, as well as 
commercial viability. After I won the competition, I 
commissioned a nationwide survey that indicated that 57 percent 
of respondents would use a robocall-blocking service. And, 
further, 17 percent said that they would pay a monthly fee for 
such a service.
    Since the beginning of April, when the FTC announced the 
winner of the competition, over 3,600 people have signed up on 
the Nomorobo mailing list. I have received over 400 e-mails 
asking, or, rather, begging, for me to release this service.
    And based on the feedback that I have received, robocalls 
are a serious quality-of-life issue, as many people on this 
panel have said. I have to agree; I hear time and time again 
how consumers feel helpless to stop robocalls. And I think it 
hits at a certain core level, and we have mentioned this, but 
they are in their homes, with their family, enjoying their 
time, and they are being interrupted by a fraudster who is 
trying to sell them something that they don't want or they 
don't need.
    So, members of this committee, I hope I have effectively 
demonstrated that the technology to defeat these robocalls 
exists today. It can be implemented quickly and easily with no 
changes to the current infrastructure. And while there are some 
concerns, such as spoofing and privacy, there are also 
solutions. The market is large and the problem is so irritating 
that consumers have shown a willingness to pay for a solution.
    So I thank you for your time, and I am committed to 
supporting your efforts in any way that I can.
    [The prepared statement of Mr. Foss follows:]

    Prepared Statement of Aaron Foss, Freelance Software Developer, 
                                Nomorobo
    Thank you, Senator McCaskill, Mr. Chairman, and distinguished 
members of the Committee. I appreciate this opportunity to testify.
    I am here today to illustrate that the technology exists, right 
now, to block illegal robocalls. And, while there are some challenges, 
such as Caller ID spoofing and privacy concerns, there also are 
effective solutions.
    To that end, there are three main points that I will discuss.
    First, I am going to talk about my winning FTC Robocall Challenge 
entry. Then I will discuss some issues and concerns involved with 
blocking robocalls. And finally, I will discuss the commercial 
viability of robocall blocking services.
    Currently, the Do-Not-Call registry is almost completely 
ineffective against illegal, mass dialed, robocallers. To fight back, 
the FTC launched a competition to find new and creative solutions to 
this problem. They chose my proposal, which I call ``Nomorobo,'' as the 
co-winner.
    In real-time, Nomorobo analyzes the incoming Caller ID and call 
frequency, across multiple phone lines. If it detects a robocaller, the 
call is automatically disconnected. All of this happens before the 
consumer's phone rings.
    As each call is analyzed, a blacklist of robocallers is continually 
updated. The system is actually built using the same technology that 
the robocallers are using, allowing it to scale, inexpensively, to 
handle millions of calls. The more calls that come into the system for 
analysis, the better the algorithm works.
    Nomorobo works on land lines, voice-over-IP and cell phones on all 
of the major carriers and does not require any additional hardware or 
software. All that is required by the consumer is a simple, one-time 
setup, enabling a free feature called simultaneous ring.
    But, as with all new ideas, there's always some skepticism. 
Industry players have expressed three major concerns about robocall 
blocking: (1) spoofing Caller ID; (2) violating consumer privacy; and 
(3) allowing legal robocalls.
    It is incredibly easy to spoof the Caller ID to show any phone 
number--and almost all of the robocallers do this. But, while you can 
falsify the calling number, you cannot falsify calling patterns. It is 
a red flag, for example, when the same phone number, spoofed or not, 
has made 5,000 calls to different numbers in the past hour. It is also 
a red flag when the same phone number is sequentially calling large 
blocks of phone numbers. Both of these scenarios indicate robocalling 
patterns.
    A static blacklist of known robocallers only works in very limited 
situations. But, by combining the Caller ID, whether real or faked, 
with real-time calling pattern analysis, robocalls can be effectively 
detected.
    Also, with solutions that only look at the metadata of a call, 
there is no need to monitor or listen to the phone call, assuring 
consumer privacy. The Caller ID data, along with the date and time, 
across many phone lines, gives enough of a fingerprint to detect 
robocallers without having to analyze the actual content of the call.
    The final concern that has been raised is how to allow legal 
robocalls, such as schools and emergency notifications, to bypass 
robocall blocking. This can be accomplished by building a trusted, 
real-time whitelist. I have had the opportunity to speak with some of 
the legal robocalling companies and they are very open to working on a 
solution that allows them to successfully deliver their calls. They 
want the illegal robocallers put out of business as much as the average 
consumer does.
    As my final point, I will show proof of consumer demand for this 
type of service as well as commercial viability. I commissioned a 
nationwide survey that indicated that 57 percent of respondents would 
use a robocall blocking service. Further, 17 percent said they would 
pay a monthly fee for such a service.
    Since the beginning of April, when the FTC announced the winner of 
the competition, over 3,600 people have signed up on the Nomorobo 
mailing list. I have received over 400 hundred e-mails asking, or 
rather, begging for this service to be released.
    Based on the feedback that I have received, robocalls are a serious 
quality-of-life issue. I hear time and time again how consumers feel 
helpless to stop robocalls. It hits at a certain core level. Here they 
are, in their homes, with their family, and they are being interrupted 
by a fraudster trying to sell them something they do not want or need.
    Members of this Committee, I hope that I have effectively 
demonstrated that the technology to defeat robocalls exists today. It 
can be implemented quickly and easily with no changes to the current 
telephone infrastructure. And, while there are some concerns, such as 
spoofing and privacy, there are also solutions. Stopping robocalls 
would be a huge win for the consumer. The market is large and the 
problem is so irritating that consumers have even shown a willingness 
to pay for a solution.
    I thank you for your time and I am committed to supporting your 
efforts in any way that I can.



    Senator McCaskill. I appreciate you being here very much.
    And let me just say, Mr. Stein, I was fascinated with--
because you have now had experience doing this for years, and 
it has worked commercially for your carrier.
    Mr. Stein. Absolutely.
    Senator McCaskill. And so let me just say for the record 
that the first company that is smart enough to do this in the 
United States, I am switching carriers to that one.
    [Laughter.]
    Mr. Stein. Fair enough.
    Senator McCaskill. And I think that the American--and I 
would like, Mr. Altschul, for you to address this, and Mr. 
Rupy.
    I don't understand. We have heard from two good witnesses 
that the technology is available. And I understand fear of the 
consequences and Mencken's quote and that for every action we 
have in Congress, there is a reaction. On the other hand, if 
you look at the fears, to me, they are much less than what the 
reality is now that people are dealing with.
    So why is it that Mr. Foss's technology is not quickly 
being adapted in these commercial markets? And why is it that 
Mr. Stein's patented product has not been licensed to an 
American carrier?
    Mr. Altschul. I don't know about the license issues, but we 
do have concerns about overreaching and blocking legitimate 
calls.
    As senators, I am sure you are more familiar than you would 
like to be with the kind of informational robocalls and text 
messages you receive from airlines when flights are delayed 
because of weather or other events. The volume of these calls 
are unpredictable, and they will flood carrier networks with 
identical recorded messages and text messages.
    And they will carry a caller ID. That caller ID, if it is 
put on a whitelist, can then be spoofed, as I think we all 
agree how easy it is to spoof a number, and have the same 
fingerprint or pattern as other messages.
    One of the things----
    Senator McCaskill. Well, how does Mr. Stein's licensed 
product--I hate to interrupt you, but if I could get a 
conversation between the two of you.
    Mr. Altschul. Sure.
    Senator McCaskill. Mr. Stein, address the airlines calling 
with information that a flight has been delayed.
    Mr. Stein. Well, first----
    Senator McCaskill. In reality, how does that work----
    Mr. Stein. Sure.
    Senator McCaskill.--with your technology?
    Mr. Stein. Sure. Remember that the technology has been 
deployed for a number of years, so I will speak specifically to 
the Canadian calling patterns, which, for the record, I don't 
have any reason to believe are any different than American.
    The reality is that the system, the Telemarketing Guard 
system itself, will only begin to monitor and, therefore, take 
action once there are reports by enough people that say, this 
is an unwanted telemarketer.
    Further, once that call comes in, the system will not block 
that call. Being a carrier ourselves, we have always viewed it 
as our responsibility to put the two people on the phone, not 
impede that. But it is to give a moment of pause and to get the 
other party, the calling party, to press ``1,'' record their 
name, and so forth.
    In the event of delayed flights and things like that, these 
things tend to go right through. There hasn't been any effect. 
We have never seen a complaint like that because----
    Senator McCaskill. So no consumer is going----
    Mr. Stein.--people have never----
    Senator McCaskill.--to call----
    Mr. Stein. That is right. No consumer----
    Senator McCaskill. Nobody is going to call and say, the 
airline let me know my flight was late. And that is what the 
initial----
    Mr. Stein. That is right.
    Senator McCaskill. That is the initial beginning of the 
block, is a critical mass of people calling and saying, hey, 
these guys are----
    Mr. Stein. That is right, because they----
    Senator McCaskill.--rip-off people or they are trying to 
sell me siding.
    Mr. Stein.--they are not objecting. The consumer is not 
objecting. And I talk about this benefit, in that nobody other 
than the consumers themselves decide what is and what is not an 
unwanted telemarketer or robocall. And so that----
    Mr. Altschul. But my point is that that number, which is 
welcome and legitimate and properly described on caller ID, is 
basically the identifier that the carrier and the customer and 
Mr. Stein's system has to track wanted and unwanted calls.
    Right now, there is no need for scammers to actually pick 
numbers that consumers would recognize as the source of 
messages, informational messages, they would like to receive. 
But there is no limitation on a fraudster's ability to use an 
airline's number to fill out the caller ID field in the 
robocalls and messages that they send.
    Senator McCaskill. Well, let me just address that. So let's 
assume in Canada, since 2007, that a fraudster got a hold of 
United Airlines' number and started using that.
    How would it work with your system, Mr. Stein, if that 
happened, if they spoofed a legitimate number that no consumer 
would complain about, but they started using it and----
    Mr. Stein. Right.
    Senator McCaskill. What would happen? How would that work?
    Mr. Stein. Two quick comments.
    First, the system is quite smart. And over the years that 
we have tuned it and built and enhanced it, we have built in a 
great many safeguards to prevent this exact thing from 
happening. And I won't elaborate in full detail on all those, 
but such is to say that if such a thing were to happen and 
reports were to start to come in, one would assume that at the 
same time the airline is using that phone number, too, and 
therefore a lot of those calls are getting accepted by our 
customers.
    So we would be seeing votes going in both directions, and 
the system becomes increasingly skeptical and looks for what 
distinguishes the two types of calls, and then is able to break 
them down based on many of the other criteria that are no 
longer using just, say, the caller ID, which is the thing that 
is easy to spoof. There are a lot of other characteristics in a 
phone network that are available that we use.
    Senator McCaskill. He wins.
    Mr. Altschul. Well, give me another chance.
    [Laughter.]
    Mr. Stein. I would be happy to----
    Mr. Altschul. As Mr. Foss testified, his technology is the 
same technology or built on the same roots as the technology 
these scammers are using. And what we have found, particularly 
in the area of policing text messages that come across 
carriers' gateways from the Internet is, as the carriers become 
more sophisticated in looking at the fingerprints, looking at 
the volume of calls, the number, the speed, the number of 
identical messages, the fraudsters become increasingly better 
educated and sophisticated at the same time.
    So this is a cat-and-mouse game. You set a threshold, say, 
originally of 10,000 messages a minute or an hour, and any 
message volume for identical messages above that would get 
caught. Before long, the fraudsters set their threshold at 
9,000 messages. You lower the threshold again, the fraudsters 
find out their messages aren't going through, they change their 
threshold to still stay under the limit. The costs of doing 
this really are almost zero.
    And so, for every action and every, you know, time you 
raise the wall, the bad guys come back at you with a taller 
ladder.
    Senator McCaskill. Well, I think the point that is being 
made, and for Mr. Rupy and Mr. Altschul, the point that is 
being made is we have the capability of being as sophisticated 
in terms of technology as the bad guys. And there are a number 
of different algorithms that could be used to identify the bad 
guys that currently our American carriers just aren't bothering 
to use.
    And that is hard for me--I mean, Mr. Foss is on the 
precipice of hopefully rolling out a product that will show 
that Canada won't be a decade ahead of us, as opposed to 
merely--what are we up to now? Six, 7 years? You know, if the 
sky was going to fall, I think Mr. Stein probably wouldn't be 
here.
    And, Mr. Rupy, I will wait for Mr. Heller to ask questions 
to come back and ask your take on this.
    Because it worries me that we are going to say, well, you 
know, if we do this to try to catch the bad guys, they are just 
going to do something else. Can you imagine the amount of money 
we could have saved if we just would have just given up on 
trying to interdict drugs?
    Mr. Altschul. Well, and to be clear----
    Senator McCaskill. ``Well, if we do that, if we go after 
their airplanes, they are going to do boats. Let's not do the 
airplanes. Or if we do boats, they are going to go over, you 
know, the Mexican border. Let's don't do that, because then 
they will just go over the Mexican border.''
    We just keep trying. And I think this is one of these 
issues that we really haven't teed up yet to really try hard.
    Mr. Altschul. Well, to be clear, wireless carriers, with 
respect to SMS text messages, are doing exactly what you have 
described, and it has been an iterative learning experience. 
And some of the lessons learned--it is just basically a spam 
filter, but a spam filter for text messages--are instructional 
as to how smart the bad guys are.
    Senator McCaskill. We are smart.
    Senator Heller?
    Senator Heller. Madam Chairwoman, thank you.
    Mr. Stein, I want to talk a little bit about Telemarketing 
Guard. Is that a unique system in Canada?
    Mr. Stein. Yes.
    Senator Heller. Are there any other carriers that have 
anything that is similar to what you have?
    Mr. Stein. No. We--no.
    Senator Heller. You talked about years. How long has it 
taken you to develop this particular system?
    Mr. Stein. We came up with the idea in early 2006. We had 
it commercially deployed, built, tested, et cetera, 
commercially deployed by, I believe, early 2007.
    Senator Heller. Any initial weaknesses to the system, 
things that----
    Mr. Stein. No, I wouldn't say there were weaknesses. I 
would say we learned lots in the initial days, but nothing 
concerning, no.
    Senator Heller. OK.
    Mr. Stein. No complaints from customers, et cetera, nothing 
like that.
    Senator Heller. Have you been approached by any other 
carriers, whether in Canada or the U.S., to borrow or buy the 
technology?
    Mr. Stein. A little bit. We participated in the FTC's 
robocall summit in the fall last year. After that, we had a 
couple of calls, some light inquiries, but nothing pursued too 
greatly.
    Senator Heller. So you got beaten out by Nomorobo?
    [Laughter.]
    Mr. Stein. Well, in fairness, we didn't submit 
Telemarketing Guard to the challenge, as we were not eligible 
for it. We had presented at the summit that preceded the 
challenge.
    Senator Heller. OK. Are you aware of any barriers that may 
prohibit bringing this kind of technology from Canada to the 
United States?
    Mr. Stein. No, I am not.
    Senator Heller. OK. OK.
    Mr. Foss, congratulations.
    Mr. Foss. Thank you.
    Senator Heller. And you said you had about 3,600 people now 
that have--do they buy your product, they download your 
product? What do they do? How does someone know to get involved 
in what the FTC has produced in this case?
    Mr. Foss. Sure. And that is the funny part, is that it is 
not even available yet. It was just the announcement. I set up 
a website, I put in my e-mail and said, it is coming soon. 
Thirty-six hundred people said, give this to me, whatever it 
is. They don't know how much it is going to be, how it is going 
to work. They just know that there is a problem. So this is 
just basically the press that has been generated by this and 
directed them to the website.
    Senator Heller. When do you think it will be readily 
available?
    Mr. Foss. By the end of the summer, actually.
    Senator Heller. So you will have some kind of a program to 
make sure that the American public are aware of what your 
product is?
    Mr. Foss. Exactly, exactly. After the competition, I wound 
up talking to a bunch of investors. I got enough seed money to 
go and build this into a beta to actually go and launch it and 
to address some of these exact concerns to see--you know, the 
best way is just to prove that it will work.
    And one of the things, I think, that Mr. Stein's product is 
actually better at than mine, because he is a carrier, is the 
worst-case scenario, I think, in Mr. Stein's case is that the 
call gets diverted to voice-mail. You know, a lot of these 
things--the thinking that went into it before everybody had 
voice-mail was that, and especially on mine, is that the call 
is going to be disconnected, you are going to lose the call 
forever. But now if we can just divert it to voice-mail, much 
like spam does into your spam filter, I think everybody would 
rather have a voice-mail box with five or six robocalls than 
five or six robocalls.
    Senator Heller. OK.
    You mentioned during your testimony that there were some 
industry players that were concerned with this technology. What 
are those concerns, and what have you done to address those 
concerns?
    Mr. Foss. Yes. So the main concern is the caller ID 
spoofing. A lot of players feel and what they say is that, 
well, the caller ID is always going to be wrong, so therefore 
we can't stop this problem.
    But, again, I see it a little bit differently. And by using 
the caller ID, whether it is real or not, with these calling 
patterns, real-time calling patterns, that we can actually 
start--again, even if it is faked, it doesn't really matter.
    The second is the consumer privacy. A lot of people have 
said that this isn't like e-mail, because in an e-mail you can 
go and analyze the content, and that in order to do this, you 
would have to listen in on everybody's phone calls.
    And I don't believe that is correct. I think that using 
this caller ID, with the calling patterns--and, again, much 
like the other solutions that are here--some other reported 
data, the FTC data, you actually have a stab at making this--it 
is not going to be perfect.
    It is absolutely not going to be 100 percent. But even with 
spam filters today, certain spam gets through, sometimes real 
e-mails get into your spam folder. And I think that we need to 
try it, and I think that we need to start somewhere.
    Senator Heller. Mr. Rupy, you said in your testimony that 
technology is constantly changing. Do you believe a solution 
like this, Nomorobo, is a solution that can work?
    Mr. Rupy. Senator, that is a fantastic question, and I have 
to say I think it is absolutely fantastic that there are 
innovators like Mr. Foss out there who are working to develop 
these various solutions. And as Mr. Foss acknowledges, there 
are challenges to some of these technological solutions.
    And my point on the technological issue is that, like so 
many issues that arise in this Internet space, it is a 
constantly evolving and moving target. So I think in terms of 
designing a single technological silver bullet that can fully 
address the robocall issue, that will be an ongoing challenge.
    Senator Heller. One more question, if you don't mind.
    Senator McCaskill. Sure. Take all the time you would like.
    Senator Heller. Mr. Altschul, government agencies cited 
their number of complaints. Do you find those numbers to be 
accurate?
    Mr. Altschul. Carriers receive complaints. The government 
agencies at all levels, Federal and state, receive these 
complaints. So they are accurate, but our gripe is the way they 
are actually displayed and recorded by the Federal 
Communications Commission. They are divided across services, 
and it really doesn't provide a clear picture of what is going 
on or the magnitude of the problem.
    Senator Heller. Has the industry had an opportunity to 
verify the number of cites and complaints that----
    Mr. Altschul. I am not in any way challenging the numbers. 
It is how they are reported.
    Senator Heller. OK.
    Thank you.
    Senator McCaskill. Mr. Rupy, when the common carriers see 
mass amounts of calling and short calls in a massive quantity 
come over the transom, what do you do?
    Mr. Rupy. Senator, that is where, during my oral testimony 
and the written testimony, several of our member companies have 
these network operations centers. And there are measures that 
these companies can take to address these mass-calling events. 
And that is where some of these working groups that I mentioned 
come in.
    Our experience----
    Senator McCaskill. What do they do now, though? You said 
they take different measures. Can you give me an example of one 
of the--you know, you don't have to name the carrier, but give 
me an example of--let's assume one of my carriers, which is 
AT&T, let's assume a massive amount comes over in a short 
period of time in a geographically concentric area. Do you know 
what they actually do when that happens, if anything?
    Mr. Rupy. Senator, I know they take actions. I don't know 
what those specific actions are. And we would be happy to 
provide that information.
    Senator McCaskill. I think that would be important for us 
to know.
    Mr. Rupy. Absolutely. Sure. And----
    Senator McCaskill. Go ahead.
    Mr. Rupy. And just to keep in mind, oftentimes these mass-
calling events, I mean, they are not all directly attributable 
to robocalling events. So, you know, for example, on September 
11th, we had mass-calling events in New York City and 
Washington, D.C. So----
    Senator McCaskill. Well, I think that is pretty obvious, 
though. I mean, obviously everyone understands that.
    I am talking about, all of a sudden it is Kansas City--and, 
you know, it is interesting. I was on a radio program this 
morning talking about this. And they had gone out and done a 
man-on-the-street interviewing people. And every single person 
they talked to said they had gotten a call about siding. So, 
clearly, there had been a massive amount of calling in the 
Kansas City area about siding.
    And that is what I am talking about. I mean, there is 
nothing going on, there is no extraordinary weather event. You 
know, if a plane is late, we are talking about maybe 100, 200 
people; we are not talking about thousands.
    I need to know what, if anything, these carriers are doing. 
And do they feel an obligation to do something?
    Mr. Rupy. Well, and they are certainly taking action on 
those issues, Senator. But I think one of the points that was 
raised earlier by various folks on the panel here is that, 
under our current legal framework, regardless of whether it is 
a mass-calling event or sort of a standard calling volume, we 
are under a legal obligation to complete those phone calls 
and----
    Senator McCaskill. Well, so you are saying that you legally 
couldn't adopt Mr. Stein's technology?
    Mr. Rupy. As I understand----
    Senator McCaskill. It connects; it just decides whether it 
goes to voice-mail.
    Mr. Rupy. As I understand Mr. Stein's and Mr. Foss's 
technology, to a certain degree you have these--the decision is 
removed, to a certain degree, from the consumer and is made by 
the carrier with----
    Senator McCaskill. No, that is not true. That is not true. 
I don't think that is true.
    Mr. Stein, the carrier is not making the decision, is it?
    Mr. Stein. No, the carrier does not make that decision. I 
can only speak, of course, to our system.
    The system doesn't block a call under any circumstance, 
other than if the customer were to say, here is one given 
number that I don't want, a blacklist, available on many 
services.
    In the case of Telemarketing Guard, it impedes the call and 
asks the caller to press a digit to record their name. But in 
all of those cases, those recorded names, the phone call is 
made, et cetera.
    And I am not a lawyer, so I can't speak to the legality of 
it. I am sure we have a lot of them in the room, though.
    [Laughter.]
    Senator McCaskill. I would really appreciate, Mr. Rupy, if 
you would take back to the legal staff at your organization the 
specifics of both Mr. Stein's and Mr. Foss's technology and get 
back to us with what specific problems, from a legal framework, 
you believe that there are.
    I think if this were offered by a carrier, you know, I am 
just shaking my head that an American carrier has not tried to 
adopt one of these technologies because I think it is such a 
winner in an open, capitalistic, competitive market. And by my 
television ads that I watch, all the carriers are pretty darn 
competitive right now. I mean, they are desperately not just 
trying to get new customers; they are trying to hold on to 
customers. Because, you know, now that we can take our phone 
numbers, there is this incredible desire to see if you can't 
get somebody to walk from someone else to you.
    And for the life of me, I can't figure out why you all are 
not more aggressively going after this very desirable 
technology on behalf of consumers.
    Mr. Rupy. Senator, we can absolutely provide that 
information.
    And just to be clear, I mean, our member companies do 
offer--and I always encourage consumers to reach out to their 
respective carriers to see the services that they are offering. 
And they do range from things like, whether it is caller 
identification, to conditional call forwarding, to anonymous-
call blocking. There are tools that the carriers are providing 
and continuing to develop.
    And, again, we operate under that very stringent obligation 
to complete those calls. And it is very clear to us that that 
is something we need to comply with.
    Senator McCaskill. Well, I don't want anybody to break the 
law.
    [Laughter.]
    Senator McCaskill. But I have a feeling we can do this with 
the technology that is out there without breaking any law and 
maybe even without us having to write any laws. And wouldn't 
that be special? Because it is always nice when we can reach a 
marketplace solution in the private sector.
    And I know that I am getting a nodding head from Senator 
Heller right now.
    [Laughter.]
    Senator McCaskill. It is always better to do it in the 
marketplace with a competitive solution as it relates to 
capitalism than it is for the government to come in with a 
heavy hand and try to impose a solution.
    So I think it is pretty important that we hear from you 
about what you see the legal missteps would be, since we have 
an example of technology that has been used in a country that 
also embraces capitalism----
    [Laughter.]
    Senator McCaskill.--and it seems to be working and working 
well for their company. So I would really appreciate you all 
with that follow-up.
    Do you have any other questions?
    Senator Heller. Yes, I do. And thank you, Madam Chairwoman, 
and thanks for your comments and to follow up.
    And this is for the panel. I guess the bottom line with 
this particular hearing is, should the FTC and the FCC be given 
enforcement powers or additional enforcement powers, or can 
this be solved through the private industry itself?
    Mr. Rupy?
    Mr. Rupy. Senator, I think as Senator McCaskill mentioned 
earlier this morning, the existing legal framework dealing with 
robocalls appropriately targets the bad actors who are engaging 
in this fraudulent activity.
    And I think to the extent that we continue to target that 
enforcement and make that enforcement aggressive against those 
actors, that is the ideal solution here. Because, as I have 
said in my written testimony, our member companies work with 
agencies like the FTC to prosecute these actors. We want to 
catch them as much as everyone here in this room.
    Mr. Altschul. I would agree. I think it requires a holistic 
solution. Everybody has to play a role. And, certainly, the 
enforcement agencies have a critical role, as do consumers, as 
does the industry.
    One of the things that our industry has begun looking at, 
which is far from yielding any results, is how to better map 
and trace these calls and messages when they cross through the 
Internet to traditional carrier networks.
    As you may know, carrier networks, when they were closed, 
used a signaling system called Signaling System 7--there never 
was a System 8--as a way of setting up and identifying calls 
for billing, tracing, all kinds of things. The Internet uses a 
system call SIP, Session Initiation Protocol. And mapping or 
being able to marry these two very, very different kinds of 
protocols is part of the problem right now the enforcement 
agencies and everyone is having in trying to trace this back to 
the source of these messages.
    And if the technical experts who have begun to work on this 
marrying of SIP to SS7 messaging protocols are able to solve 
that problem, we will enable, you know, great progress in 
identifying and stopping these messages at the source.
    Senator Heller. I am going to guess Mr. Stein and Mr. Foss 
believe that there is a private-sector solution to these 
problems, and I will leave it at that.
    I just want to ask one more question for you, Mr. Rupy and 
Mr. Altschul: if you have any response to the FTC raising the 
issue of abolishing the common carrier exemption. Do you have 
any feel on that?
    Mr. Rupy. In terms of the common carrier exemption, 
Senator, I think, as Senator McCaskill raised in her testimony 
this morning, we have these issues where we have sort of 
conflicting regulations, one for wireline, one for wireless. 
And I think to the extent you start expanding the scope of, you 
know, numerous agencies regulating similar players in the 
field, that gets to be problematic.
    Second, we fully support--and what I thought I heard in the 
earlier testimony from the FTC is that, to the extent there is 
an entity out there engaging in illegal activity, they are 
going to go after that entity, as well they should. And we 
fully support that, whether they are a common carrier or 
whomever.
    Mr. Altschul. As the FCC's Mr. Bash testified, there is an 
existing working relationship between the two agencies. They 
are both enforcing the same laws. And I think that there are 
some institutional advantages that each institution has 
developed in their respective areas. I am not aware that it is 
a problem that has actually deterred any kind of investigation 
or enforcement activity.
    Senator Heller. OK.
    I want to thank the witnesses for your time and energy.
    And, Madam Chairwoman, thank you for holding this hearing.
    Senator McCaskill. I appreciate everyone being here.
    I will tell you that I know that there are concerns, and 
all of the concerns about what can be done are based in wanting 
to follow the law and stay true to what your mission is as 
carriers, whether it be wireless or wired.
    I do want you to know that I am going to follow up in 3 
months and ask to find out what your members are doing in this 
regard and what they feel like they can do. And whatever 
information that you can give us in the next 3 months that 
would spell out the problems you would have with adopting 
either the technology that Mr. Foss is ready to roll out by the 
end of the summer--do you know what it is going to cost, Mr. 
Foss?
    Mr. Foss. I am actually hoping to offer it for free.
    Senator McCaskill. OK. So am I going to have to look at 
ads?
    Mr. Foss. No, actually, because I figure that on the----
    Senator McCaskill. How are you going to do that? We know we 
have to look at ads if it is free.
    Mr. Foss. I didn't put this in my testimony, but this 
problem doesn't only affect the consumer; it affects 
businesses.
    Senator McCaskill. Right.
    Mr. Foss. And as the other panel talked about it, the 
PSAPs, the emergency call centers. The FCC put me in touch with 
the organization that manages a lot of these 911 centers. I 
think there are over 5,000 of them. You know, this do-not-call 
list is being implemented.
    And, you know, I said to them, I said, if there was a 
blacklist, a real-time blacklist, an up-to-date list of the 
numbers that you shouldn't be answering, would that be helpful? 
And they said that they had never even thought about that, and 
if that existed, it would be amazing.
    So I think that there is an actual, you know, this data set 
of the real-time robocallers and the calls that you shouldn't 
pick up on, even I think on the consumer side--or, I am sorry, 
on the business side or anybody who has large call centers, you 
know, thousands of phone lines.
    And I spoke to some that are in financial services, you 
know, the Citibanks and the Chases of the world. Every call 
that comes in, they have to go and screen for fraudsters. So if 
they know before they even send it for screening that they 
should immediately dump it, I think that there is a real 
valuable asset there.
    So I think that by doing it with the consumers and offering 
them, you know, a really good service of blocking the 
robocalls, my thesis is that I can make money on the business 
side.
    Senator McCaskill. On the business side.
    Mr. Foss. Yes.
    Senator McCaskill. OK. Well, you don't need to worry; when 
you roll out, I will give it a try.
    Mr. Foss. Sounds good. Thank you.
    Senator McCaskill. And thank you, Mr. Stein, for coming 
from Canada. And we will look forward to following up with our 
carriers here in America to see if we can't reach a solution.
    Because I do know this: With the technology that is 
available, if it is just about chasing these guys, law-
enforcement-wise, around the country, we are never going to get 
the results that consumers deserve on this.
    So I thank you all very much for being here. We appreciate 
it.
    [Whereupon, at 11:39 a.m., the hearing was adjourned.]
                            A P P E N D I X

  Response to Written Questions Submitted by Hon. Claire McCaskill to 
                             Lois Greisman
    Question 1. Ms. Greisman, the FTC has essentially placed a call for 
help with robocalls. Then-FTC Chairman Jon Leibowitz noted last year at 
a summit on the issue, ``Law enforcement alone can't stop the 
robocalls.'' No matter how many cases the FTC brings, the agency says 
there is not much more it can do from an enforcement perspective to 
abolish illegal robocalls. As a result, the Commission held a public 
competition to find a viable technological solution that could provide 
some level of defense against robocalls. Why do you think a 
technological solution is the best answer to this problem?
    Answer. I do not believe there is one best answer to this problem; 
rather, the FTC must simultaneously pursue multiple strategies to fight 
illegal robocalls. We launched the Robocall Challenge because 
technological advances caused the explosion in illegal robocalls, and 
we believe it is important to encourage technological solutions that 
can counteract the proliferation of illegal robocalls. But the agency's 
other efforts--including law enforcement, coordination with experts, 
and consumer education--continue.
    As one example, we continue our aggressive and strategic law 
enforcement, and the actions we have brought in Federal court have shut 
down entities responsible for billions of illegal robocalls. For 
instance, the FTC put a robocall operation out of the telemarketing 
business and recovered approximately $3 million under a settlement 
resolving FTC charges that the defendants bombarded consumers with more 
than two billion robocalls, including the ubiquitous ``Rachel from 
cardholder services'' calls, sometimes using false Caller ID names, 
such as ``SALES DEPT.'' See FTC v. Asia Pacific Telecom, Inc., 
available at http://www.ftc.gov/opa/2012/03/asiapacific.shtm.

    Question 2. The FTC selected three winners in its robocall 
challenge. Why were those three entrants chosen as winners? What about 
their submissions, compared to the rest, does the FTC believe will best 
limit fraudulent robocalls for America's consumers?
    Answer. The Robocall Challenge submissions were judged by Steve 
Bellovin (Chief Technologist from the FTC), Henning Schulzrinne (Chief 
Technology Officer at the Federal Communications Commission), and Kara 
Swisher (co-Executive Editor of All Things Digital). The judges 
reviewed hundreds of entries to find submissions that best met all 
three of the judging criteria: (1) Does it work?; (2) Is it easy to 
use?; and (3) Can it be rolled out? What follows is a more detailed 
explanation of the criteria, which was publicly posted at http://
robocall.challenge.gov/details/criteria:
    Does it work? (weighted at 50 percent)

   How successful is the proposed solution likely to be in 
        blocking illegal robocalls? Will it block wanted calls? An 
        ideal solution blocks all illegal robocalls and no calls that 
        are legally permitted. (For example, automated calls by 
        political parties, charities, and health care providers, as 
        well as reverse 911 calls, are not illegal robocalls.)

   How many consumer phones can be protected? What types of 
        phones? Mobile phones? Traditional wired lines? Voice over 
        Internet Protocol (``VoIP'') land lines? Proposals that will 
        work for all phones will be more heavily weighted.

   What evidence do you already have to support your idea? 
        Running code? Experiments? Peer-reviewed publications?

   How easy might it be for robocallers to adapt and counter 
        your scheme? How flexible is your scheme to adapt to new 
        calling techniques? How have you validated these points? 
        Remember that the real test of a security system is not whether 
        or not you can break it; it's whether or not other people can.

    Is it easy to use? (weighted at 25 percent)

   How difficult would it be for a consumer to learn to use 
        your solution?

   How efficient would it be to use your solution, from a 
        consumer's perspective?

   Are there mistakes consumers might make in using your 
        solution, and how severe would they be?

   How satisfying would it be to use your solution?

   Would your solution be accessible to people with 
        disabilities?

    Can it be rolled out? (weighted at 25 percent)

   What has to be changed for your idea to work? Can it 
        function in today's marketplace? (E.g., Does it require changes 
        to all phone switches world-wide, and require active 
        cooperation by all of the world's phone companies and VoIP 
        gateways, or can it work with limited adoption?) Solutions that 
        are deployable at once will be more heavily weighted, as will 
        solutions that give immediate benefits with even small-scale 
        deployment.

   Is deployment economically realistic?

   How rapidly can your idea be put into production?

    The judges selected the winners from among the contestants' many 
informed, creative, and intelligent submissions, based on the criteria 
laid out above.
    While I cannot speak for the judges, I believe the winning 
solutions contain promising ideas about how to address difficult 
realities such as the limitations of the telecommunications 
infrastructure and the prevalence of caller ID spoofing. For example, 
one of the winners, Aaron Foss, proposed an innovative method of 
deploying a filter, via a cloud-based service that consumers could 
access using a simultaneous ring feature on their current telephones. 
The other two winners tackled the problem of caller ID spoofing in 
novel ways; they each designed their own mechanisms that can help 
determine whether an incoming call's caller ID information is authentic 
or not. I believe the three winning solutions represent real 
breakthroughs compared with what is currently available in the 
marketplace.

    Question 3. The United States Telecom Association, at the hearing, 
said its member companies work with various law enforcement agencies, 
including the FTC, to prosecute individuals and entities responsible 
for fraudulent robocalls. Would this be an accurate assessment of the 
industry from the FTC's point of view?
    Answer. Many of the members of the United States Telecom 
Association do assist us with investigations of those responsible for 
illegal robocalls, and we greatly appreciate this assistance. As I 
stated in my testimony, I do believe that carriers could be more 
proactive in identifying suspicious activities on their networks that 
could be indicative of illegal robocalling.

    Question 4. What percent of the FTC's investigations into potential 
violations of your telemarketing and robocall rules are initiated by 
information voluntarily submitted by industry to your agency? Since the 
establishment of the National Do Not Call Registry, how many times have 
telecommunications providers alerted the FTC to potential violations of 
either your telemarketing rules or robocall rules?
    Answer. Generally speaking, industry players have not proactively 
alerted the FTC to potential violations of our rules. The more common 
scenario is that our attorneys or investigators contact a carrier about 
a potential rule violation, and the carrier then assists us in 
obtaining available information about that particular call campaign.

    Question 5. The FTC and the FCC have clear rules establishing what 
is, and what is not, allowable when it comes to robocalls, and both 
agencies have taken enforcement actions to stop illegal robocalls. Yet 
despite all of these efforts, intrusive and fraudulent robocalls have 
proliferated. Technological solutions may very well provide the 
American public with relief, but I also think that there is no 
substitute for strong law enforcement. As such, I am interested in 
learning further about the FTC's and the FCC's efforts and what more 
can be done to stop illegal robocalls. What are the limitations your 
agency faces in bringing more enforcement cases? Is there a need for 
legislation to assist your efforts?
    Answer. We do face challenges related to law enforcement against 
illegal robocallers. Given automated dialing technology, inexpensive 
long distance calling rates, and the ability to move internationally 
and employ cheap labor, robocalling has become an attractive marketing 
channel to fraudsters. And new technologies make it easy for 
robocallers to hide their identities by spoofing and regularly changing 
caller ID information, as well as by allowing them to generate calls 
from any location in the world where they have access to an Internet 
connection. In addition, a single call now traverses the networks of 
many different service providers and no single entity knows the entire 
path of a call; the result is that every entity must timely provide 
data in order for law enforcers to successfully trace a call. These 
factors, among others, make investigation and enforcement increasingly 
difficult and time-consuming.
    Separate from these challenges, and as I stated in my testimony, I 
believe the common carrier exemption is outdated and unnecessary. The 
telecommunications industry has become much more complex and 
diversified, and the line between what is and is not a carrier has 
blurred significantly. Currently, numerous entities participate in 
delivering the robocall, including the associated caller ID 
information, and not all of their functions fit squarely into the 
categories of carrier or non-carrier. It would be far more efficient if 
the FTC could address illegal telemarketers and those who facilitate 
their activities without having to determine which of the entities that 
participated in a single call campaign might be considered common 
carriers. In other words, the exemption creates an obstacle to 
effective law enforcement efforts against robocallers. For these 
reasons and in this context, I support elimination of the common 
carrier exemption.
                                 ______
                                 
   Response to Written Questions Submitted by Hon. Amy Klobuchar to 
                             Lois Greisman
    Question 1. I want to applaud the FTC for undertaking the 
``Robocall challenge'' as an innovative way for government to work with 
the private sector and software engineers to find solutions. Ms. 
Greisman, can you discuss the process for the challenge and how you 
chose the awardees? What is the next step for the FTC in encouraging 
getting these products to market and helping to fight fraud?
    Answer. The Robocall Challenge was the FTC's first public contest 
under the America COMPETES Reauthorization Act of 2010. One of our 
first steps involved choosing three experts to judge the challenge. Two 
of our judges were the Chief Technologists from the FTC and the Federal 
Communications Commission--Steve Bellovin and Henning Schulzrinne--who 
both have extensive technical backgrounds in telecommunications, Voice 
over Internet Protocol (``VoIP'') technology, and security. The third 
judge was Kara Swisher, one of the co-founders of All Things Digital 
and someone who has broad expertise regarding consumer technology 
products and the consumer experience. The judges helped determine the 
judging criteria, which were: 1) Does it work? (50 percent); 2) Is it 
easy to use? (25 percent); and 3) Can it be rolled out? (25 percent). 
For more information regarding these criteria, please visit this 
website: http://robocall.challenge.gov/details/criteria.
    We publicly announced the Robocall Challenge on October 18, 2012, 
and submissions were due by January 17, 2013. We received 798 eligible 
submissions. Pursuant to the official rules, an internal panel screened 
these submissions to determine, in accordance with the judging 
criteria, which submissions warranted further review by the judges. The 
internal panel identified 266 submissions that were then reviewed by 
the expert judging panel. Following numerous meetings and discussions, 
the judges chose seven finalists and assigned numerical scores to each. 
Two engineers from Google won the nonmonetary award in the large 
organization category. The judges found a tie within the category of 
individuals and small organizations; thus, the two winners split the 
$50,000 prize.
    The goal of the challenge was to stimulate the marketplace and 
encourage the development of new ideas. The FTC does not take an active 
role in bringing the winning solutions to the market and does not 
endorse particular consumer products. To identify and reward the 
challenge winners and promote the challenge as a tool to spur 
innovation in the marketplace, we held a press conference and produced 
videos about the challenge. Through these means and related efforts, we 
think we have helped to encourage innovators to focus their talents on 
developing a technical solution to the problem of illegal robocalls.

    Question 2. Ms. Greisman and Mr. Bash, we know that technology will 
continue to evolve. How are the FTC and the FCC working to keep up with 
these evolutions in communications to protect consumers from future 
scamming operations?
    Answer. We issued the Robocall Challenge to spur technological 
innovations that would complement our law enforcement efforts to 
protect consumers from scammers. As we looked at the marketplace in the 
context of e-mail spam, we saw numerous experts deploying technological 
solutions to protect consumers against spammers and fraudsters, but 
relatively little focus on robocalls. Through the challenge, we sought 
to bring more attention to illegal robocalls and prompt rich and vital 
initiatives to address the problem. I believe that the challenge 
accomplished this goal and that the winners' sophisticated filters and 
other similar products can significantly enhance consumer protection. 
Notably, none of the four technology experts who created the winning 
solutions had ever worked on the robocall problem before. I will add 
that while the challenge spurred nearly 800 innovators to submit 
proposals, it also prompted others to go to the drawing table. We have 
heard that the FTC's recent robocall initiatives gave other 
entrepreneurs new connections and ideas to fight illegal robocalls, 
which is an important ripple effect. We hope this will help stimulate 
the market to develop technology that will combat telephone spam, 
similar to efforts to develop technology to reduce e-mail spam.
    In addition, we work to ensure that our internal team at the FTC 
keeps up with the ongoing evolution of communications technology. For 
example, we regularly speak to and work with technical experts who can 
help us understand evolving technology, including academics, industry 
insiders, and entrepreneurs. We partner with internationally renowned 
technological associations--such as the Messaging, Malware and Mobile 
Anti-Abuse Working Group and the Internet Engineering Task Force--to 
work toward a longer-term goal of changing the telephone network 
protocols to allow for authenticated telephone calls. We also use our 
evolving knowledge to innovate with respect to our own law enforcement 
investigations and targeting. As one public example, last October we 
announced our new robocall honeypot, which is a group of phone numbers 
that allows the FTC to receive robocalls directly and helps the agency 
gather evidence and take quick action.
                                 ______
                                 
    Response to Written Questions Submitted by Hon. Mark Warner to 
                             Lois Greisman
    Question 1. Over the past year or so, my office has seen a marked 
increase in calls and letters regarding possible abuses by some 
telemarketers. Since January 2013, my office has heard from more than 
300 people requesting assistance with the Do Not Call List, and since 
taking office in 2009, my office has heard from over 1200 people on 
this issue. A small sampling of some of the concerns we have received 
are also included in this document for the record.*
---------------------------------------------------------------------------
    \*\ Selected Constituent Robocall Concerns

    ``It is an invasion of our privacy, and it ties up our phones and 
disrupts our lives to get as many as 15 calls every single day when we 
have been on the donotcall list since day 1. Anything you can do about 
this issue will be greatly appreciated.''
      --Constituent from Arlington, VA 5/26/2012

    ``I am registered on the ``Do Not Call'' list for my home phone 
(not cellphone) and I am still getting many solicitation ``robo calls'' 
for lower credit card rates, car warranties, and other commercial 
products. Some callers block caller ID. I systematically report these 
callers via the ``report a violator'' process on the Registry website. 
I have been on the do-not-call registry since its inception, and I have 
verified this on the Registry site. I also put my elderly mother's home 
phone number on the DNC Registry several years ago. She also gets many 
solicitation calls. I am well versed on the types of calls that the DNC 
system is supposed to address, and the kinds of calls that are 
excepted. I am astonished at the number of calls I am getting even as I 
am on the DNC list.''
      --Constituent from Fairfax, VA 05/04/2012

    ``xxx-xxx-xxxx [redacted]. This number continues to call with 
impunity, even though they are on my FTC Do Not Call Registry, and 
several other residents I'm friends with. They are scam artists, trying 
to mine personal information, and the FTC hasn't responded to my 
concerns. Are you game for going after this group of obvious scammers, 
because a lot of vulnerable citizens, could be prey for their scam 
which involves lowering debt. They call themselves [redacted], and they 
are a company I and others have never done business with. Thank you 
kindly.''
      --Constituent from Fairfax, VA 06/06/2012

    ``I have been getting calls on my home phone from a 'Credit Card 
Services' for over a year now. I have submitted at least five 
complaints on the FTC website and at least two complaints' on the 'Do 
Not Call' website. I have asked to speak to a supervisor numerous 
times, only to be hung up on. I have told them over and over and over 
again to not call me. I have threatened them with FTC complaints. I 
have received over 30 calls from this company and have turned in many 
complaints to the Federal Trade Commission and nothing seems to work. 
If you look on the internet, you will see tens of thousands of 
complaints. Therefore, I would like to request that you (my 
congressmen) get the Federal Trade Commission to do their job and shut 
these people down.''
      --Constituent from Alexandria, VA 07/23/2012

    ``Over the last couple of months, I've been getting an increasing 
number of robo-dialer/recorded commercial calls in violation of the Do-
Not-Call registry. Many have been from the same 'crook', often ``Credit 
Card Services.'' I've reported most of them on the FTC's Do Not Call 
registry. (That is not counting the growing number of political calls, 
which unfortunately are not violations of Do Not Call).''
      --Constituent from Reston, VA 08/20/2012

    ``Senator--Please have someone on your staff Google (xxx)xxx-xxxx 
[redacted] and you will see several websites dedicated to complaints 
about harassing phone calls from this number asking if we want to 
refinance our VA loan. We have been on the Do Not Call list since 2006 
and have asked them to stop calling us 6-8 times a day. They pointedly 
refuse to stop. This is not about freedom of speech, it is invasion of 
privacy. I, on behalf of many, many people request my Federal 
Government figure a way to make these people stop calling over and over 
again.''
      --Constituent from Yorktown, VA 08/27/2012

    ``My name is [redacted] and I reside in Charlottesville, VA. I am 
in the fourth grade. I am writing to ask that you help by intervening 
in the issue of unsolicited phone calls. Our number is on the Do Not 
Call list. In the last two days we've received three such calls.''
      --Constituent from Charlottesville, VA 05/23/2012
---------------------------------------------------------------------------
    As a supporter of the Do Not Call Act, I sympathize with the 
frustration of my constituents. I recognize that the same technology 
that is allowing telephone service providers to more efficiently manage 
networks is also enabling disreputable callers to abuse the system.
    Still, it seems to me that if we can't find a technical solution to 
abusive telemarketing calls, that raises many serious questions as 
well. I encourage you to think more creatively about possible 
solutions, and about any legislative authorities that would better 
enable the FTC to keep pace with technology. For instance, have similar 
problems occurred in other countries? If so, are there any solutions 
adopted in other markets that might be applicable in the U.S.?
    Answer. Yes, the same problems are occurring in other countries. We 
have undertaken a global search for solutions, and we did identify the 
``Telemarketing Guard'' by Primus Telecommunications Canada, whose 
Chief Technology Officer Matthew Stein testified on July 10 after also 
appearing at our Robocall Summit the previous fall. We have actively 
encouraged carriers and others to bring Telemarketing Guard or a 
similar solution to consumers in the United States. Telemarketing Guard 
is currently only available to approximately one million Canadian 
consumers.
    Unfortunately, we are unaware of successful solutions that have 
been more broadly adopted in other countries. Instead, the FTC is 
actively participating in a joint search for such solutions. Our Office 
of International Affairs (``OIA'') coordinates with our international 
counterparts on related issues. For example, our OIA participates in 
several multinational networks that coordinate on broad strategic 
matters related to illegal telemarketing, including through the London 
Action Plan (``LAP'') on international spam enforcement cooperation and 
the Centre of Operations Linked to Telemarketing. Through our 
involvement in the LAP's Do Not Call Working Group, we are actively 
engaged with the multinational organization's initiatives to develop an 
international strategy related to caller ID spoofing. One example is 
the LAP's upcoming October meeting, which is being held in coordination 
with the Messaging, Malware and Mobile Anti-Abuse Working Group. The 
FTC, with the Canadian Radio-television and Telecommunications 
Commission and the Australian Communications and Media Authority, will 
lead a discussion of proposed solutions--technological, policy and 
enforcement--that can be considered for global telecommunications 
systems. Also at that meeting, we are leading a panel on telephony 
abuse, which includes caller ID spoofing.
    We are also fully engaged with international communities of 
technical experts that are working to address this problem, such as the 
Internet Engineering Task Force. In addition, we have collaborated with 
foreign law enforcement authorities on particular cases, for example 
working closely with Canadian law enforcement on FTC v. Direct 
Financial Management, Inc., No. 10 C 7194 (N.D. Ill. Feb. 8, 2012), and 
FTC v. Economic Relief Technologies, LLC, No. 1:09-cv-03347 (N.D. Ga. 
Jul. 22, 2010).

    Question 2. In 2012, the Federal Trade Commission (FTC) challenged 
innovators to come up with a solution that would block illegal 
commercial robocalls on landlines and mobile phones. One of the 
proposed solutions creates a filtering system, similar to an e-mail 
spam filter, that intercepts and filters out illegal robocalls using a 
technology that ``blacklists'' and ``whitelists'' phone numbers. The 
proposal envisions a consumer-facing system, however, others have 
suggested that a network-based system might be more efficient and less 
burdensome for consumers.
    Do you believe that a filtering system would be effective? If so, 
do you believe it should be implemented by networks or by consumers? If 
not, do you have ideas for a better solution?
    Answer. I believe effective solutions for blocking illegal 
robocalls could be based on any number of possible technical 
approaches. An effective solution might, for example, be based on 
filtering, and could be designed to be implemented by networks, 
consumers, or otherwise. However, it is important to consider not only 
whether the proposed solutions would be effective to block illegal 
robocalls, but also whether they would be easy to use, and whether they 
could be rolled out in a timely manner. For example, a network-based 
solution could require extensive investment and active participation by 
carriers, which might make such a solution more difficult to roll out 
than a solution that consumers could implement on their own, with 
little or no reliance on carriers. In any event, the FTC actively 
encourages carriers to pursue all efforts to curb illegal robocalls, 
regardless of the specific technical approach or approaches adopted.
                                 ______
                                 
     Response to Written Questions Submitted by Hon. Dan Coats to 
                             Lois Greisman
    Question 1. I commend the work the Federal Communications 
Commission (FCC) and the Federal Trade Commission (FTC) have done in 
establishing a national Do-Not-Call Registry pursuant to their 
authorities under the Telephone Consumer Protection Act (TCPA). The 
registry is nationwide in scope, applies to all telemarketers (with the 
exception of certain non-profit organizations), and covers both 
interstate and intrastate telemarketing calls. Recently, I have heard a 
number of concerns from my state regarding the regulation of high 
volume auto-dialer initiated voice over Internet protocol (VOIP) 
``broadcasted'' calls. My understanding is that these calls can put 
10,000 calls per minute onto Indiana's landline telephone network, by 
using VOIP technology, in an attempt to get around Indiana's Do Not 
Call List. Does the technology exist to identify these high volume, 
auto-dialer initiated calls in real time?
    Answer. I am not currently aware of any such identification 
technology that is broadly available to U.S. consumers. There are 
certain call-blocking ``apps'' that work only on wireless smartphones. 
The FTC launched the Robocall Challenge to encourage parties to create 
solutions that would identify and block illegal, high-volume, 
autodialed calls, which are generally made using voice over Internet 
protocol technology. The Challenge was designed to stimulate the 
marketplace to put such technological solutions into the hands of U.S. 
consumers, and we believe it was enormously fruitful. The winning 
solutions, including that of Aaron Foss, who testified at the hearing 
on July 10th, contained promising ideas about how to address illegal 
robocalls using a combination of call pattern analytics and crowd-
sourced data.

    Question 1a. My understanding is that when phone calls are made, 
there are usually two user-facing identifiable pieces of information: a 
phone number and a Caller ID Name (CNAM). I understand that the CNAM 
can be used to display the calling party's name alongside the phone 
number, to help users easily identify a caller. I have also been told 
that there are numerous CNAM lookup services which allow you to pay a 
small fee to lookup the CNAM of a specified caller (by phone number). 
Do any mechanisms exist to prevent telemarketers from blocking CNAM 
lookups by individuals?
    Answer. I am unaware of any technological mechanisms that would 
prevent telemarketers from blocking CNAM lookups by individuals. 
However, with certain limited exceptions, a telemarketer violates the 
FTC's Telemarketing Sales Rule (TSR) if it fails to transmit an 
accurate telephone number and, when made available by the 
telemarketer's carrier, its CNAM, to any caller identification service 
used by the call recipient. 16 C.F.R. 310.4(a)(8). Thus, telemarketers 
violate the TSR if they block their telephone numbers, causing a 
consumer's caller ID or telephone to show ``blocked'' or 
``unavailable.'' In addition, it is illegal to assist and facilitate a 
practice prohibited by the TSR; such liability attaches if the entity 
knows or consciously avoids knowing of the prohibited activity. 16 
C.F.R. 310.3(b). As a result, carriers or CNAM lookup services that 
help telemarketers hide their identities by providing false caller ID 
information or blocking the telemarketers' phone numbers, or that 
otherwise facilitate illegal activity, may be liable under the TSR.
                                 ______
                                 
  Response to Written Questions Submitted by Hon. Claire McCaskill to 
                              Eric J. Bash
    Question 1. The FTC focuses on deceptive telemarketing through the 
lens of consumer protection. The FCC, as regulator of the 
telecommunications industry, brings its expertise on the wireline and 
wireless telephone networks themselves. Does the FCC have any concerns 
about or see any barriers to the winning technological solutions chosen 
by the FTC?
    Answer. Henning Schulzrinne, the FCC's Chief Technology Officer, 
was one of three judges who determined the winners of the FTC-sponsored 
competition. Other FCC staff members have also spoken informally with 
the winners of the FTC Robocall Challenge to gain a better 
understanding of their winning ideas. We understand that the winning 
ideas are currently in the development or implementation phases. While 
there are questions about some details, including whether caller ID 
spoofing may affect their use of caller ID information to identify 
robocallers, we believe the ideas are promising. The competition 
explicitly focused on ideas that could be implemented quickly, even if 
they could not suppress all illegal robocalls. Longer term approaches 
that increase the trustworthiness of caller ID information may make 
solutions such as those identified in the FTC-sponsored competition 
work even better.

    Question 2. At the hearing, you said that additional legislation 
could be useful to better enforce against individuals or entities that 
provide or facilitate phony numbers used to spoof caller IDs. You also 
mentioned that the FCC has previously suggested revising the Truth in 
Caller ID Act to give the FCC direct regulatory authority over so-
called third-party spoofing providers. From your agency's perspective, 
would changing the Truth in Caller ID Act be the most effective way for 
the FCC to help stop caller ID spoofing? Are there any other 
legislative solutions the FCC believes would better equip it to take 
enforcement actions against such entities or individuals?
    Answer. In addition to recommending that Congress give the FCC 
authority to regulate third-party spoofing providers, the FCC has also 
suggested that Congress expand the Truth in Caller ID Act in several 
other ways, by:

   broadening the scope of the statute to prohibit spoofing by 
        persons outside of the United States when directed at people 
        inside the United States;

   clarifying whether the existing restrictions should apply to 
        Voice over Internet Protocol providers that enable only 
        outbound calls; and

   stating explicitly that text messaging is covered by the 
        statute.

    The FCC recommended that Congress take these additional steps to 
secure the integrity of telephone numbers as a reliable identifier of a 
call's origin, particularly as VoIP technology increasingly replaces 
the traditional technologies upon which telecommunication service is 
widely based, and as text messaging increasingly supplements voice 
communications.
    Technological solutions that empower consumers to block illegal 
robocalls so that they do not receive them in the first instance may 
also be helpful in thwarting illegal robocalls. An industry standards 
organization is currently working with FCC technology staff to design a 
system whereby originating carriers and certain VoIP callers would 
cryptographically sign calls so that receiving carriers can validate 
that callers in fact have the right to use the telephone number they 
are using. The Commission staff hopes that the joint effort may lead to 
implementable specifications in about a year.

    Question 3. The FCC's distinction in its rules for wireline and 
wireless phones stems from the Telephone Consumer Protection Act of 
1991. Needless to say, the wireless industry has changed dramatically 
since then. Would revisiting that statute to eliminate the 
anachronistic distinction be something that would allow the FCC to be 
more aggressive in taking on fraudulent robocalls?
    Answer. The restrictions on robocalls in the Telephone Consumer 
Protection Act (TCPA) and the FCC's implementing rules are generally 
stricter for calls to wireless numbers than to wireline/residential 
ones. Section 227(b)(1)(A) of the TCPA and FCC rules prohibit non-
emergency autodialed or prerecorded calls to wireless numbers, 
regardless of content, without prior express consent. Section 
227(b)(1)(B) and FCC rules prohibit prerecorded telemarketing calls to 
residential/wireline numbers without prior express consent. Neither 
autodialed calls nor purely informational calls are covered by the 
latter provision concerning calls to residential lines. (Note that the 
TCPA does not distinguish between fraudulent robocalls and other 
robocalls, for either residential/landline or wireless numbers; as 
such, while the Commission is certainly very concerned about fraudulent 
robocalls, whether a call is fraudulent is not an element of legal 
analysis under the TCPA.)
    In light of increasing consumer reliance on wireless services since 
the TCPA was enacted more than twenty years ago, the distinctions in 
the statute between wireless and residential/wireline numbers may well 
be outdated. These distinctions can be a source of confusion to 
consumers, complicate compliance efforts for law-abiding callers and 
marketers, and introduce additional steps for law enforcement, in terms 
of both the factual discovery and legal analysis needed to investigate 
and pursue those who violate the law. As a result, harmonizing the 
legal standards that apply to robocalls to residential/wireline and 
wireless numbers may well benefit consumers, callers and telemarketers, 
as well as law enforcement.

    Question 4. What are the limitations your agency faces in bringing 
more enforcement cases? Is there a need for legislation to assist your 
efforts?
    Answer. As discussed at the hearing, two major impediments to the 
FCC taking stronger enforcement action against illegal robocallers are 
the difficulty of identifying wrongdoers, and limitations on the FCC's 
power. Amendments to the Truth in Caller ID Act such as those the FCC 
has proposed (see above), coupled with development and implementation 
of technological means to improve caller ID authentication (also 
discussed above), would help to address the first of the FCC's 
enforcement challenges. Congress could enhance the FCC's enforcement 
powers against illegal robocallers by making it easier for the agency 
to impose significant forfeitures, in at least three ways: (1) allow 
the FCC to impose a forfeiture on a non-licensee robocaller without 
first issuing a citation; (2) extend the current statute of limitations 
from one year to at least two; (3) increase the maximum forfeiture that 
the agency can impose on non-licensee robocallers.
                                 ______
                                 
    Response to Written Question Submitted by Hon. Amy Klobuchar to 
                              Eric J. Bash
    Question. Ms. Greisman and Mr. Bash, we know that technology will 
continue to evolve. How are the FTC and the FCC working to keep up with 
these evolutions in communications to protect consumers from future 
scamming operations?
    Answer. The Commission recognized in 2003 and 2008 orders that 
``[i]t is clear from the statutory language and the legislative history 
that Congress anticipated that the FCC, under its TCPA rulemaking 
authority, might need to consider changes in technologies.'' In those 
orders, the Commission made it clear that as automated calling moved 
away from random or sequential dialing, the TCPA could still be applied 
to newer or different calling technologies, including predictive 
dialers that relied more primarily on defined lists of telephone 
numbers rather than random or sequential dialing. We will continue to 
monitor and address new technologies in this area as warranted, and 
Commission staff is actively fostering industry standards that, in the 
long term, should help to reduce the number of illegal robocalls and 
the malicious caller ID spoofing often associated with them. In the 
short term, we also plan to work with key telecommunication providers 
to address the problem of consumers being inundated with calls if their 
numbers happen to be used as caller ID by illegal robocallers.
                                 ______
                                 
    Response to Written Questions Submitted by Hon. Mark Warner to 
                              Eric J. Bash
    Question 1. Over the past year or so, my office has seen a marked 
increase in calls and letters regarding possible abuses by some 
telemarketers. Since January 2013, my office has heard from more than 
300 people requesting assistance with the Do Not Call List, and since 
taking office in 2009, my office has heard from over 1200 people on 
this issue. A small sampling of some of the concerns we have received 
are also included in this document for the record.*
---------------------------------------------------------------------------
    \*\ Selected Constituent Robocall Concerns

    ``It is an invasion of our privacy, and it ties up our phones and 
disrupts our lives to get as many as 15 calls every single day when we 
have been on the donotcall list since day 1. Anything you can do about 
this issue will be greatly appreciated.''
      --Constituent from Arlington, VA 5/26/2012

    ``I am registered on the ``Do Not Call'' list for my home phone 
(not cellphone) and I am still getting many solicitation ``robo calls'' 
for lower credit card rates, car warranties, and other commercial 
products. Some callers block caller ID. I systematically report these 
callers via the ``report a violator'' process on the Registry website. 
I have been on the do-not-call registry since its inception, and I have 
verified this on the Registry site. I also put my elderly mother's home 
phone number on the DNC Registry several years ago. She also gets many 
solicitation calls. I am well versed on the types of calls that the DNC 
system is supposed to address, and the kinds of calls that are 
excepted. I am astonished at the number of calls I am getting even as I 
am on the DNC list.''
      --Constituent from Fairfax, VA 05/04/2012

    ``xxx-xxx-xxxx [redacted]. This number continues to call with 
impunity, even though they are on my FTC Do Not Call Registry, and 
several other residents I'm friends with. They are scam artists, trying 
to mine personal information, and the FTC hasn't responded to my 
concerns. Are you game for going after this group of obvious scammers, 
because a lot of vulnerable citizens, could be prey for their scam 
which involves lowering debt. They call themselves [redacted], and they 
are a company I and others have never done business with. Thank you 
kindly.''
      --Constituent from Fairfax, VA 06/06/2012

    ``I have been getting calls on my home phone from a 'Credit Card 
Services' for over a year now. I have submitted at least five 
complaints on the FTC website and at least two complaints' on the 'Do 
Not Call' website. I have asked to speak to a supervisor numerous 
times, only to be hung up on. I have told them over and over and over 
again to not call me. I have threatened them with FTC complaints. I 
have received over 30 calls from this company and have turned in many 
complaints to the Federal Trade Commission and nothing seems to work. 
If you look on the internet, you will see tens of thousands of 
complaints. Therefore, I would like to request that you (my 
congressmen) get the Federal Trade Commission to do their job and shut 
these people down.''
      --Constituent from Alexandria, VA 07/23/2012

    ``Over the last couple of months, I've been getting an increasing 
number of robo-dialer/recorded commercial calls in violation of the Do-
Not-Call registry. Many have been from the same 'crook', often ``Credit 
Card Services.'' I've reported most of them on the FTC's Do Not Call 
registry. (That is not counting the growing number of political calls, 
which unfortunately are not violations of Do Not Call).''
      --Constituent from Reston, VA 08/20/2012

    ``Senator--Please have someone on your staff Google (xxx)xxx-xxxx 
[redacted] and you will see several websites dedicated to complaints 
about harassing phone calls from this number asking if we want to 
refinance our VA loan. We have been on the Do Not Call list since 2006 
and have asked them to stop calling us 6-8 times a day. They pointedly 
refuse to stop. This is not about freedom of speech, it is invasion of 
privacy. I, on behalf of many, many people request my Federal 
Government figure a way to make these people stop calling over and over 
again.''
      --Constituent from Yorktown, VA 08/27/2012

    ``My name is [redacted] and I reside in Charlottesville, VA. I am 
in the fourth grade. I am writing to ask that you help by intervening 
in the issue of unsolicited phone calls. Our number is on the Do Not 
Call list. In the last two days we've received three such calls.''
      --Constituent from Charlottesville, VA 05/23/2012
---------------------------------------------------------------------------
    As a supporter of the Do Not Call Act, I sympathize with the 
frustration of my constituents. I recognize that the same technology 
that is allowing telephone service providers to more efficiently manage 
networks is also enabling disreputable callers to abuse the system.
    Still, it seems to me that if we can't find a technical solution to 
abusive telemarketing calls, that raises many serious questions as 
well. I encourage you to think more creatively about possible 
solutions, and about any legislative authorities that would better 
enable the FTC to keep pace with technology. For instance, have similar 
problems occurred in other countries? If so, are there any solutions 
adopted in other markets that might be applicable in the U.S.?
    Answer. The Commission staff has previously discussed telemarketing 
and related consumer issues with its Canadian counterparts, to the 
mutual benefit of both groups. Our recent research shows that, in 
addition to Canada, the United Kingdom, Australia, and India have all 
addressed problems with unwanted telemarketing calls to consumers. For 
example, the UK has a ``Telephone Preference Service,'' which appears 
to be similar to our National Do-Not-Call Registry. Similarly, India 
and Australia also have do-not-call lists. In the UK, a technology is 
available that blocks all calls until the caller enters an identifying 
phone number, thereby establishing that the call is a human-originated 
call rather than a robocall. In Canada, a blocking service has been 
implemented that is aimed at stopping unwanted calls from known 
robocall or telemarketer numbers, based, in part, on filtering 
technology that relies on telemarketers identified by consumers (i.e., 
crowd-sourced). While we must, of course, focus on the specific 
statutory requirements of the TCPA, we will also continue to monitor 
the situations in other countries to ensure that we are aware of 
solutions that they may develop to problems that we have in common.

    Question 2. In 2012, the Federal Trade Commission (FTC) challenged 
innovators to come up with a solution that would block illegal 
commercial robocalls on landlines and mobile phones. One of the 
proposed solutions creates a filtering system, similar to an e-mail 
spam filter, that intercepts and filters out illegal robocalls using a 
technology that ``blacklists'' and ``whitelists'' phone numbers. The 
proposal envisions a consumer-facing system, however, others have 
suggested that a network-based system might be more efficient and less 
burdensome for consumers. Do you believe that a filtering system would 
be effective? If so, do you believe it should be implemented by 
networks or by consumers? If not, do you have ideas for a better 
solution?
    Answer. The FCC staff spoke informally with the winners of the FTC 
Robocall Challenge, and we understand that the winning ideas are 
currently in the development or implementation phases. There are 
questions about some details, including whether caller ID spoofing may 
affect their use of caller ID information to identify robocallers, and 
they may work better if the integrity of caller ID can be improved. We 
will continue to monitor the progress of these proposed solutions, 
including whether they should be implemented on telecommunications 
networks or by consumers, or through a combination of the two 
approaches. We will also work with telecommunication service providers 
to encourage the development of open interfaces that allow third-party 
services to offer innovative ways for consumers to manage their 
incoming phone calls.
                                 ______
                                 
     Response to Written Questions Submitted by Hon. Dan Coats to 
                              Eric J. Bash
    Question 1. I commend the work the Federal Communications 
Commission (FCC) and the Federal Trade Commission (FTC) have done in 
establishing a national Do-Not-Call Registry pursuant to their 
authorities under the Telephone Consumer Protection Act (TCPA). The 
registry is nationwide in scope, applies to all telemarketers (with the 
exception of certain non-profit organizations), and covers both 
interstate and intrastate telemarketing calls. Recently, I have heard a 
number of concerns from my state regarding the regulation of high 
volume auto-dialer initiated voice over Internet protocol (VOIP) 
``broadcasted'' calls. My understanding is that these calls can put 
10,000 calls per minute onto Indiana's landline telephone network, by 
using VOIP technology, in an attempt to get around Indiana's Do Not 
Call List. Does the technology exist to identify these high volume, 
auto-dialer initiated calls in real time?
    Answer. Technology exists that can identify--and block--a high-
volume of calls in certain instances, such as calls originating from a 
single number, or sharing the same electronic signature, such as call 
length, call source and destination numbers, or certain VoIP call 
attributes. Large businesses often purchase this type of technology to 
protect their corporate networks from voice SPAM, VoIP Denial of 
Service attacks, and other activities the business seeks to prevent.

    Question 1a. My understanding is that when phone calls are made, 
there are usually two user-facing identifiable pieces of information: a 
phone number and a Caller ID Name (CNAM). I understand that the CNAM 
can be used to display the calling party's name alongside the phone 
number, to help users easily identify a caller. I have also been told 
that there are numerous CNAM lookup services which allow you to pay a 
small fee to lookup the CNAM of a specified caller (by phone number). 
Do any prohibitions exist to prevent this practice by telemarketers?
    Answer. CNAM databases link Calling Party Numbers (CPNs) to the 
individuals and entities to whom the numbers have been assigned. Some 
terminating providers maintain their own CNAM database and others 
purchase CNAM database services from third-party providers that 
aggregate the listing information from a variety of sources. Typically 
this aggregation is done with real-time information feeds and may 
involve a chain of feeds through several layers of providers and 
resellers. When a phone call is made, Caller ID services often dip into 
the CNAM database to look up the name or other identifying information 
of the caller. We are not aware of any specific legal restrictions 
prohibiting access to CNAM databases. Commission staff would be happy 
to discuss these issues in further detail with your staff.
                                 ______
                                 
  Response to Written Questions Submitted by Hon. Claire McCaskill to 
                             Kevin G. Rupy
    Question 1. Your member companies are by no means the problem, but 
I believe your industry should be more proactive in being part of the 
solution if we are going to seriously address the proliferation of 
fraudulent robocalls. In your testimony, you described past and present 
actions of providers to help combat the problem. Do you believe your 
industry has done as much as it could or should to assist law 
enforcement and consumers? Why or why not?
    Answer. Yes, we believe our industry does as much as it can to 
assist both law enforcement and consumers in this regard. The 
telecommunications industry is, along with the consumer, a victim of 
unwanted calls that annoy consumers and diminish the value and 
stability of telecommunications services. Unfortunately, a large number 
of criminals, now able to use cybercrime techniques and international 
boundaries to evade national jurisdiction, present challenges to law 
enforcement, consumers and industry alike. The telecommunications 
industry is highly motivated to control abuse, and is responding to the 
growth of abuse by creating the right technologies, systems and 
processes to mitigate it. Industry is not only assisting, but in most 
cases leading enforcement, technology development and collaborative 
actions needed to address this issue.
    USTelecom members have long worked collectively and coordinated 
with private and government stakeholders to address issues relating to 
illegal robocalls. For example, in a 2010 FTC action against a 
robocaller that in one year made more than 370 million calls to 
consumers nationwide, the agency specifically acknowledged the help 
that USTelecom member companies AT&T and Verizon provided in the 
investigation and resolution of the case.
    In terms of assistance to our customers, no area is more 
challenging to address than mass calling events originating outside of 
our networks over multiple IP-based platforms using spoofed caller ID, 
many of which involved auto-dialers or pre-recorded human voices, often 
referred to as robocalls. Since no technology currently exists that 
enables carriers to identify in real time whether any single call 
traversing their network is legitimate or illegitimate, it is not 
currently practical to deploy services that can identify the illegal 
robocall needle in the high-volume call traffic haystack. As reflected 
in Attachment One, carriers have no way of distinguishing between legal 
or illegal robocalls that may be terminating on their network--only the 
consumer is in a position to make that determination.
    Nevertheless, carriers do their best to protect their customers in 
the context of suspicious mass calling events, as outlined in greater 
detail in our answer to your next question. Our members have long been 
providing--and will continue to develop--various services consumers can 
use to help mitigate the robocall problem. The scope and availability 
of these services differ by carrier, but may include basic caller-ID 
functionality, conditional call-forwarding, anonymous call-blocking, 
block lists and other related services. Unfortunately, these services 
are susceptible to evasion by caller-ID spoofing, which can be 
accomplished at relatively low cost from anywhere in the world using 
readily available technologies such as a personal computer and free 
software.

    Question 2. Mr. Rupy, you explained at the hearing that your member 
companies' network operations centers monitor call traffic over their 
networks and initiate investigations into suspicious mass-calling 
events. You also added that your member companies address such 
suspicious mass-calling events through different measures. Could you 
provide specific details on what measures your member companies take 
when they notice a suspicious mass-calling event?
    Answer. As discussed in our testimony, many USTelecom member 
companies maintain network operations centers that monitor network 
traffic, conduct traffic data forensics and initiate mass-calling 
investigations. During suspected mass-calling events, providers can 
undertake various measures to mitigate their effect, including routing 
traffic to an alternate tandem, and coordinating with the providers 
sending the incoming traffic. For example, when a carrier realizes that 
a connecting provider is sending an unusually large amount of traffic 
onto its network, it may contact the connecting provider to request 
that its customer cease generating the traffic. Of course, given the 
interconnected nature of the Internet and the public switched telephone 
network, the company delivering the large call-traffic volume may be 
only one of several intermediaries simply passing along traffic 
received from yet another provider.
    Finally, many companies maintain call fraud bureaus that will 
initiate investigations after a suspected mass calling event. Using 
traffic data forensics and other investigative tools, providers will 
try to identify the parties behind a particular mass calling event. 
When they can identify the entities behind these calls, USTelecom's 
members have sued the perpetrators, and often engage law enforcement 
agencies and the Federal Trade Commission to investigate and prosecute 
illegal robocall incidents.

    Question 3. What issues, specifically, with regards to robocalls 
are the standards-setting groups you cited in your testimony addressing 
that would better protect American consumers from fraudulent robocalls? 
What kinds of solutions and best practices have been and will be 
adopted by industry members to address the robocall problem?
    Answer. USTelecom's member companies have an extensive record of 
working with standards-setting groups and other industry associations 
to address robocalls. In particular, they have worked with and continue 
to work with the Alliance for Telecommunications Industry Solutions 
(ATIS) to develop standards and best practices to address the robocall 
problem, with the Internet Engineering Task Force (IETF) to develop 
standards for secure call authentication and with the Communications 
Fraud Control Association (CFCA) to combat communications fraud.
    ATIS has developed various guidelines and best practices that help 
network management personnel address traffic management issues that may 
arise during mass calling events. For example, ATIS helped public 
safety agencies optimize their deployment of Emergency Notification 
Systems to better ensure call completion without overwhelming affected 
networks. ATIS has also published reference information for responsible 
companies on the use of auto-dialers, and will publish an updated 
section related to network security later this year. ATIS is also 
planning to update existing documents as they relate to the deployment 
of next generation networks in order to address various network 
management issues, including mass calling events.
    The IETF is the standards organization responsible for most Voice 
over Internet Protocol (VoIP) standards. The IETF has formed an active 
Secure Telephone Identity Revisited (STIR) Working Group, whose 
priority will be to develop standards for use in IP-based 
communications networks for authenticating callers.
    Through public-private partnerships like the CFCA, industry 
stakeholders work alongside law enforcement to identify best practices 
and solutions to a broad range of telecommunications-related issues, 
including robocalls. Given its collaborative public-private nature, the 
CFCA fosters critical relationships between individual industry 
stakeholders and law enforcement. These professional relationships are 
crucial to investigating and prosecuting individuals that engage in 
fraudulent activities occurring over communications networks, including 
illegal robocalls.
    The CFCA also provides a forum for industry stakeholders and law 
enforcement to coordinate on issues relating to the latest scams, 
evolving investigations and cases, and other related fraud matters. 
This invaluable coordination increases the abilities of public and 
private stakeholders to stay ahead of the constantly evolving robocall 
environment, and thereby more effectively combat the bad actors 
operating in this area.

    Question 4. In their written and oral testimony, witnesses from the 
FTC and the FCC proposed a number of statutory changes that would 
better equip their agencies to combat fraudulent robocalls. For 
inclusion in the hearing record, I ask that you provide your comments 
on the following proposed statutory changes by September 9, 2013: 
Elimination of the Federal Trade Commission Act's common carrier 
exemption.
    Answer. As Chairwoman McCaskill noted in her August 16, 2013 letter 
to USTelecom, in the area of fraudulent robocalls ``America's 
telecommunications providers are not the problem.'' We agree, and 
believe that this makes the elimination of the common carrier exception 
somewhat beside the point. Because the FCC already has full authority 
to pursue appropriate remedies against carriers, USTelecom is concerned 
that elimination of the common carrier exception could lead to 
regulation of the communications industry by two separate agencies, 
thereby creating the potential for duplicative or conflicting 
regulatory requirements, resulting in additional consumer confusion and 
frustration. More broadly, robocalls are among the many issues that 
USTelecom maintains requires Congress to create a new framework that 
reflects today's converged technological world.

    Question 4a. Changes to the FCC's enforcement authorities 
including:

   Allowing the FCC to impose a forfeiture on non-licensee 
        robocalls violators without first issuing citation;

    Answer. USTelecom supports full enforcement of relevant laws by 
agencies against entities engaging in illegal robocall activities. The 
FTC already has authority to enforce existing Do-Not-Call provisions, 
including the authority to seek civil penalties, restitution for 
victims of telemarketing scams and disgorgement of ill-gotten gains. As 
discussed below, USTelecom believes that in lieu of incremental 
approaches, Congress should instead focus on a new framework that 
better reflects the realities of today's converged marketplace.

    (b) Expanding the statute of limitations from one year to at least 
two years; and
    Answer. Given the immediacy of illegal robocalling incidents, the 
current one year time-frame on the statute of limitations is sufficient 
for ensuring that ample time is available to investigate and prosecute 
such incidents.

    (c) Increasing the maximum forfeiture that the FCC can impose on 
non-licensee robocallers.
    Answer. It is unlikely that increasing the maximum forfeiture 
available to the FCC will favorably impact the proliferation of these 
calls. In instances where such calls are originating from overseas, the 
threat of increased forfeitures will likely have no effect on the 
decision to engage in such activities. The better alternative is for 
the FCC to more aggressively pursue and prosecute bad actors operating 
in this area.

    Question 4b. Revisions to the Truth-In-Caller ID Act [of 2009] 
including:
    Answer. In light of the evolving, interconnected and interdependent 
global Internet network of networks, USTelecom cannot vouch for the 
efficacy of any of these proposals. However, USTelecom supports 
targeted and enhanced enforcement efforts that specifically target the 
entities engaged in illegal robocall activity. USTelecom pledges to 
continue to work with policymakers to address the problem and to 
cooperate in government enforcement actions against firms and 
individuals that abuse our open communications networks in order to 
perpetrate fraud on consumers, enterprise, and carriers alike.

   Expanding the scope of the prohibition to apply to persons 
        outside of the United States when spoofing is directed at 
        people inside the United States;
    Answer. USTelecom does not support expanding the Truth in Caller-ID 
Act of 2009 prohibitions to persons outside of the United States when 
spoofing is directed at people inside the United States. Significant 
jurisdictional issues would arise from the application of domestic law 
to international operators, and it is therefore highly questionable 
whether efforts to enforce such prohibitions would be effective. In 
addition, it is possible that such an expansion of domestic law could 
encourage other countries to pass extra-territorial laws to the 
detriment of both consumers and U.S.-based companies providing 
communications or other consumer services abroad.

    (b) Clarifying whether the existing restrictions should apply to 
VoIP providers that enable only outbound calls; and
    Answer. USTelecom does not oppose the FCC clarifying that the 
regulations relating to the Truth in Caller-ID Act of 2009 apply to 
VoIP providers that enable only outbound calls, to the extent such an 
ambiguity currently exists.

    (c) Giving the FCC authority to regulate third-party spoofing 
services.
    Answer. The FCC already has the authority to regulate third-party 
spoofing services. In its 2010 order addressing caller-ID spoofing, the 
FCC declined to impose additional obligations on such third-party 
caller ID services. It stated, however, that its decision to do so ``in 
no way immunizes them from the obligation to comply with the Act.'' The 
FCC further stated that where a third-party caller ID spoofing service 
causes the transmission or display of false or misleading caller ID 
information with the intent to defraud, cause harm, or wrongfully 
obtain anything of value, ``such service will be in violation of the 
Truth in Caller ID Act and our rules.''
    The solutions proposed in each of these questions are at best 
incremental approaches that reflect increasingly obsolete statutes in 
the context of today's rapidly evolving technological world. Robocalls 
are among the many issues that USTelecom maintains require Congress to 
create a new framework reflecting today's converged technologies. It is 
doubtful that the drafters of the Federal Trade Commission Act, the 
Communications Act, the Telephone Consumer Protection Act, or other 
similar statutes ever envisioned circumstances under which functionally 
equivalent services would be regulated by separate Federal agencies, 
sometimes applying different standards and consumer protections, even 
though those services could be delivered through technologies that 
often cannot be constrained by state or national boundaries. USTelecom 
hopes the Committee will begin the process of developing legislation 
that would remedy these types of circumstances with the goal of 
developing a pro-consumer, pro-competitive framework for the 
Information Age.
                             Attachment One


                         Attachment One (con't)


                                 ______
                                 
    Response to Written Questions Submitted by Hon. Mark Warner to 
                             Kevin G. Rupy
    Question 1. Over the past year or so, my office has seen a marked 
increase in calls and letters regarding possible abuses by some 
telemarketers. Since January 2013, my office has heard from more than 
300 people requesting assistance with the Do Not Call List, and since 
taking office in 2009, my office has heard from over 1200 people on 
this issue. A small sampling of some of the concerns we have received 
are also included in this document for the record.*
---------------------------------------------------------------------------
    \*\ Selected Constituent Robocall Concerns

    ``It is an invasion of our privacy, and it ties up our phones and 
disrupts our lives to get as many as 15 calls every single day when we 
have been on the donotcall list since day 1. Anything you can do about 
this issue will be greatly appreciated.''
      --Constituent from Arlington, VA 5/26/2012

    ``I am registered on the ``Do Not Call'' list for my home phone 
(not cellphone) and I am still getting many solicitation ``robo calls'' 
for lower credit card rates, car warranties, and other commercial 
products. Some callers block caller ID. I systematically report these 
callers via the ``report a violator'' process on the Registry website. 
I have been on the do-not-call registry since its inception, and I have 
verified this on the Registry site. I also put my elderly mother's home 
phone number on the DNC Registry several years ago. She also gets many 
solicitation calls. I am well versed on the types of calls that the DNC 
system is supposed to address, and the kinds of calls that are 
excepted. I am astonished at the number of calls I am getting even as I 
am on the DNC list.''
      --Constituent from Fairfax, VA 05/04/2012

    ``xxx-xxx-xxxx [redacted]. This number continues to call with 
impunity, even though they are on my FTC Do Not Call Registry, and 
several other residents I'm friends with. They are scam artists, trying 
to mine personal information, and the FTC hasn't responded to my 
concerns. Are you game for going after this group of obvious scammers, 
because a lot of vulnerable citizens, could be prey for their scam 
which involves lowering debt. They call themselves [redacted], and they 
are a company I and others have never done business with. Thank you 
kindly.''
      --Constituent from Fairfax, VA 06/06/2012

    ``I have been getting calls on my home phone from a 'Credit Card 
Services' for over a year now. I have submitted at least five 
complaints on the FTC website and at least two complaints' on the 'Do 
Not Call' website. I have asked to speak to a supervisor numerous 
times, only to be hung up on. I have told them over and over and over 
again to not call me. I have threatened them with FTC complaints. I 
have received over 30 calls from this company and have turned in many 
complaints to the Federal Trade Commission and nothing seems to work. 
If you look on the internet, you will see tens of thousands of 
complaints. Therefore, I would like to request that you (my 
congressmen) get the Federal Trade Commission to do their job and shut 
these people down.''
      --Constituent from Alexandria, VA 07/23/2012

    ``Over the last couple of months, I've been getting an increasing 
number of robo-dialer/recorded commercial calls in violation of the Do-
Not-Call registry. Many have been from the same 'crook', often ``Credit 
Card Services.'' I've reported most of them on the FTC's Do Not Call 
registry. (That is not counting the growing number of political calls, 
which unfortunately are not violations of Do Not Call).''
      --Constituent from Reston, VA 08/20/2012

    ``Senator--Please have someone on your staff Google (xxx)xxx-xxxx 
[redacted] and you will see several websites dedicated to complaints 
about harassing phone calls from this number asking if we want to 
refinance our VA loan. We have been on the Do Not Call list since 2006 
and have asked them to stop calling us 6-8 times a day. They pointedly 
refuse to stop. This is not about freedom of speech, it is invasion of 
privacy. I, on behalf of many, many people request my Federal 
Government figure a way to make these people stop calling over and over 
again.''
      --Constituent from Yorktown, VA 08/27/2012

    ``My name is [redacted] and I reside in Charlottesville, VA. I am 
in the fourth grade. I am writing to ask that you help by intervening 
in the issue of unsolicited phone calls. Our number is on the Do Not 
Call list. In the last two days we've received three such calls.''
      --Constituent from Charlottesville, VA 05/23/2012
---------------------------------------------------------------------------
    As a supporter of the Do Not Call Act, I sympathize with the 
frustration of my constituents. I recognize that the same technology 
that is allowing telephone service providers to more efficiently manage 
networks is also enabling disreputable callers to abuse the system.
    Still, it seems to me that if we can't find a technical solution to 
abusive telemarketing calls, that raises many serious questions as 
well. I encourage you to think more creatively about possible 
solutions, and about any legislative authorities that would better 
enable the FTC to keep pace with technology. For instance, have similar 
problems occurred in other countries? If so, are there any solutions 
adopted in other markets that might be applicable in the U.S.?
    Answer. Given the interdependent, interconnected, and global nature 
of the Internet, we would suspect that unwanted robocalls are an 
international issue. While USTelecom is not familiar with the 
availability, effectiveness, or nature of solutions adopted in other 
countries, the association and its member companies were interested in 
the testimony that a Canadian company provided to the Subcommittee 
regarding the deployment of a patented technology to address unwanted 
robocalls. Our member companies are seeking more information about this 
technology. However, as noted in our testimony and below, American law 
governing common carrier and privacy obligations with regard to voice 
telephone calls, together with consumers' historical needs and 
expectations with regard to call completion, may not make every 
international comparison useful, even if a particular solution can be 
implemented under another nation's laws or traditions.

    Question 2. In 2012, the Federal Trade Commission (FTC) challenged 
innovators to come up with a solution that would block illegal 
commercial robocalls on landlines and mobile phones. One of the 
proposed solutions creates a filtering system, similar to an e-mail 
spam filter, that intercepts and filters out illegal robocalls using a 
technology that ``blacklists'' and ``whitelists'' phone numbers. The 
proposal envisions a consumer-facing system, however, others have 
suggested that a network-based system might be more efficient and less 
burdensome for consumers. Do you believe that a filtering system would 
be effective? If so, do you believe it should be implemented by 
networks or by consumers? If not, do you have ideas for a better 
solution?
    Answer. Our member companies are providing--and will continue to 
develop--various technologies and services to help mitigate the 
robocall problem. These include basic caller-ID functionality, enhanced 
caller authentication and authorization, conditional call-forwarding, 
anonymous call-blocking, and other services that may vary by provider.
    The rapid and ever-changing nature of the robocall problem, 
however, makes the potential for a technological ``silver bullet,'' 
such as a filtering system, highly problematic. An open communications 
network is inherently vulnerable to abuse. This abuse can be managed, 
but (as explained below) only at the expense of some legitimate calls 
being delayed or blocked. The existing legal framework for phone calls 
under which USTelecom members operate generally does not permit such 
delaying or blocking. For example, USTelecom member companies in recent 
months have been working with Federal and state authorities on ways to 
mitigate the effects of criminal Telephony Denial of Service (TDoS) 
attacks directed towards public safety answering points (PSAPs). During 
such events, telephone providers may implement corrective measures to 
alleviate overwhelming call volumes. However, such corrective measures 
cannot be applied more broadly. For example, in the event a carrier 
inadvertently blocks a legitimate and critical robocall (e.g., one 
originating from a public safety entity), the positive public service 
aspects of such legitimate calls would be negated.
    Therefore, policymakers should proceed cautiously when 
contemplating the creation or facilitation of regimes using yet-to-be 
developed technologies that could prevent critical--possibly life-
saving--information from reaching the public. This is particularly 
challenging due to the relative ease with which illegal robocallers can 
``spoof'' legitimate phone numbers. Spoofing technology can easily fool 
consumers into taking calls they should avoid. For example, spoofing 
the number of the local municipal hospital can dupe a senior citizen 
into believing that a fraudulent effort to sell phony medical products 
or services is actually a legitimate call from a whitelisted number. In 
addition, solutions implementing call blocking features based upon a 
whitelist could potentially block an important--albeit unexpected--
message from a legitimate caller. Conversely, solutions that rely 
extensively on blocking calls populated by a blacklist could very well 
result in the blocking of legitimate calls from callers whose own phone 
numbers have been illegally spoofed.
    The blocking of select phone calls based on CNAM data is fraught 
with risk since it is impossible to identify legitimate robocalls from 
illegitimate robocalls as they are occurring. In particular, public 
safety agencies are increasingly using automated phone calls for 
``push-911'' services. Such systems send a recorded message to phone 
numbers en masse, listed and unlisted, in a geographical calling area. 
They have been used by public safety entities to great effect, most 
recently when residents of Watertown, Massachusetts, were advised by 
public safety agencies to shelter in place when their neighborhood 
became the epicenter of the manhunt for one of the Boston Marathon 
bombing suspects.
    Even non-public safety entities utilize robocalls for public safety 
purposes. For example, KFOR-TV, the NBC affiliate for Oklahoma City, 
Oklahoma, instituted the ``4Warn'' storm alert system, a free public 
service that allows Oklahoma residents to opt in to receive a voice 
message on their home, office or cell phone any time there is a tornado 
warning issued in their county. More than 34,000 people have signed up 
for the 4Warn service. During a 2010 tornado event, the service was 
used to send more than 28,000 warnings in less than 24 hours.
    A better solution to filtering, which appeared to be the consensus 
of the regulatory participants in last fall's FTC robocall workshop, 
would be the development of strong caller authentication and 
authorization mechanisms within the industry that will enable better 
management of the problem. The development of standards in this area 
for use in IP-based communications networks is the priority of the STIR 
Working Group recently activated within the IETF. However, such 
solutions are dependent upon a full transition to IP-based 
communications networks, a process that is currently in the early 
stages.
                                 ______
                                 
     Response to Written Questions Submitted by Hon. Dan Coats to 
                             Kevin G. Rupy
    Question 1. Does the technology exist to identify high volume, 
auto-dialer initiated calls in real time?
    Answer. While high-volume and random or sequential calling patterns 
can be identified, there are no currently available technologies that 
can reliably identify in real time whether calls are being initiated by 
auto-dialers, or what types of software and/or hardware are being used 
to initiate such calls. Moreover, given a mix of human-dialed calls 
from individual consumers, call centers and similar mass-calling 
locations (e.g., political campaign headquarters) and auto-dialer 
initiated calls spoofing legitimate numbers, current technologies 
cannot reliably distinguish between the two, nor between legal and 
illegal mass calling events.

    Question 2. Do any prohibitions exist to prevent a telemarketer 
from purchasing CNAM data?
    Answer. USTelecom is not aware of any existing statutory or 
regulatory prohibitions preventing a telemarketer from purchasing CNAM 
data.
                                 ______
                                 
  Response to Written Question Submitted by Hon. Claire McCaskill to 
                          Michael F. Altschul
    Question. Your member companies are by no means the problem, but I 
believe your industry should be more proactive in being part of the 
solution if we are going to seriously address the proliferation of 
fraudulent robocalls. In your testimony, you described past and present 
actions of providers to help combat the problem. Do you believe your 
industry has done as much as it could or should to assist law 
enforcement and consumers? Why or why not?
    Answer. The wireless industry is proud of its ongoing record of 
providing assistance to law enforcement. In particular, the FTC has 
noted the industry's assistance and cooperation (``The Commission would 
like to acknowledge the extraordinary cooperation that 
telecommunications carriers AT&T Mobility and Verizon Wireless provided 
in the investigation of the case.'' See http://www.ftc.gov/opa/2009/05/
robocalls.shtm. Also, ``The FTC acknowledges the invaluable assistance 
it received from Verizon Wireless, AT&T, and CTIA--The Wireless 
Association in this matter.'' See http://www.ftc.gov/opa/2011/02/
loan.shtm.)
    As I noted in my testimony, the wireless industry also has 
conducted its own investigations and brought lawsuits under the TCPA 
when they have been able to find the violators in the United States. 
Unfortunately, carriers experience the same difficulties law 
enforcement encounters in trying to trace calls to their source--these 
robocallers ``spoof'' caller ID, use proxy servers, and route calls 
through multiple networks, which, together, make it time consuming and 
often impossible to trace the source of these calls back to their 
origin.
                                 ______
                                 
    Response to Written Questions Submitted by Hon. Mark Warner to 
                          Michael F. Altschul
    Question 1. Over the past year or so, my office has seen a marked 
increase in calls and letters regarding possible abuses by some 
telemarketers. Since January 2013, my office has heard from more than 
300 people requesting assistance with the Do Not Call List, and since 
taking office in 2009, my office has heard from over 1200 people on 
this issue. A small sampling of some of the concerns we have received 
are also included in this document for the record.*
---------------------------------------------------------------------------
    \*\ Selected Constituent Robocall Concerns

    ``It is an invasion of our privacy, and it ties up our phones and 
disrupts our lives to get as many as 15 calls every single day when we 
have been on the donotcall list since day 1. Anything you can do about 
this issue will be greatly appreciated.''
      --Constituent from Arlington, VA 5/26/2012

    ``I am registered on the ``Do Not Call'' list for my home phone 
(not cellphone) and I am still getting many solicitation ``robo calls'' 
for lower credit card rates, car warranties, and other commercial 
products. Some callers block caller ID. I systematically report these 
callers via the ``report a violator'' process on the Registry website. 
I have been on the do-not-call registry since its inception, and I have 
verified this on the Registry site. I also put my elderly mother's home 
phone number on the DNC Registry several years ago. She also gets many 
solicitation calls. I am well versed on the types of calls that the DNC 
system is supposed to address, and the kinds of calls that are 
excepted. I am astonished at the number of calls I am getting even as I 
am on the DNC list.''
      --Constituent from Fairfax, VA 05/04/2012

    ``xxx-xxx-xxxx [redacted]. This number continues to call with 
impunity, even though they are on my FTC Do Not Call Registry, and 
several other residents I'm friends with. They are scam artists, trying 
to mine personal information, and the FTC hasn't responded to my 
concerns. Are you game for going after this group of obvious scammers, 
because a lot of vulnerable citizens, could be prey for their scam 
which involves lowering debt. They call themselves [redacted], and they 
are a company I and others have never done business with. Thank you 
kindly.''
      --Constituent from Fairfax, VA 06/06/2012

    ``I have been getting calls on my home phone from a 'Credit Card 
Services' for over a year now. I have submitted at least five 
complaints on the FTC website and at least two complaints' on the 'Do 
Not Call' website. I have asked to speak to a supervisor numerous 
times, only to be hung up on. I have told them over and over and over 
again to not call me. I have threatened them with FTC complaints. I 
have received over 30 calls from this company and have turned in many 
complaints to the Federal Trade Commission and nothing seems to work. 
If you look on the internet, you will see tens of thousands of 
complaints. Therefore, I would like to request that you (my 
congressmen) get the Federal Trade Commission to do their job and shut 
these people down.''
      --Constituent from Alexandria, VA 07/23/2012

    ``Over the last couple of months, I've been getting an increasing 
number of robo-dialer/recorded commercial calls in violation of the Do-
Not-Call registry. Many have been from the same 'crook', often ``Credit 
Card Services.'' I've reported most of them on the FTC's Do Not Call 
registry. (That is not counting the growing number of political calls, 
which unfortunately are not violations of Do Not Call).''
      --Constituent from Reston, VA 08/20/2012

    ``Senator--Please have someone on your staff Google (xxx)xxx-xxxx 
[redacted] and you will see several websites dedicated to complaints 
about harassing phone calls from this number asking if we want to 
refinance our VA loan. We have been on the Do Not Call list since 2006 
and have asked them to stop calling us 6-8 times a day. They pointedly 
refuse to stop. This is not about freedom of speech, it is invasion of 
privacy. I, on behalf of many, many people request my Federal 
Government figure a way to make these people stop calling over and over 
again.''
      --Constituent from Yorktown, VA 08/27/2012

    ``My name is [redacted] and I reside in Charlottesville, VA. I am 
in the fourth grade. I am writing to ask that you help by intervening 
in the issue of unsolicited phone calls. Our number is on the Do Not 
Call list. In the last two days we've received three such calls.''
      --Constituent from Charlottesville, VA 05/23/2012
---------------------------------------------------------------------------
    As a supporter of the Do Not Call Act, I sympathize with the 
frustration of my constituents. I recognize that the same technology 
that is allowing telephone service providers to more efficiently manage 
networks is also enabling disreputable callers to abuse the system.
    Still, it seems to me that if we can't find a technical solution to 
abusive telemarketing calls, that raises many serious questions as 
well. I encourage you to think more creatively about possible 
solutions, and about any legislative authorities that would better 
enable the FTC to keep pace with technology. For instance, have similar 
problems occurred in other countries? If so, are there any solutions 
adopted in other markets that might be applicable in the U.S.?
    Answer. Both in light of Primus' testimony at July's hearing and 
the fact that many robocalling operations, when ultimately identified, 
are located off-shore, it is likely that this phenomena has an 
international dimension to it. However, because CTIA's focus is 
domestic in nature, we do not have great familiarity with what 
solutions or attempted solutions may have been used in other markets. 
Additionally, even if technology solutions are deployed successfully in 
other markets, they would need to be evaluated to determine whether 
they could be deployed here in a manner that would be consistent with 
wireless carriers' regulatory and legal obligations.

    Question 2. In 2012, the Federal Trade Commission (FTC) challenged 
innovators to come up with a solution that would block illegal 
commercial robocalls on landlines and mobile phones. One of the 
proposed solutions creates a filtering system, similar to an e-mail 
spam filter, that intercepts and filters out illegal robocalls using a 
technology that ``blacklists'' and ``whitelists'' phone numbers. The 
proposal envisions a consumer-facing system, however, others have 
suggested that a network-based system might be more efficient and less 
burdensome for consumers. Do you believe that a filtering system would 
be effective? If so, do you believe it should be implemented by 
networks or by consumers? If not, do you have ideas for a better 
solution?
    Answer. Many of the filtering systems submitted for evaluation in 
the FTC's ``Robocall Challenge'' contest were based on Caller ID, which 
is easily spoofed, notwithstanding the fact that such spoofing is 
illegal. Given this vulnerability, I am skeptical that they will work. 
Additionally, to the extent that filtering systems were deployed at the 
network level, they would require carriers to screen the content of 
traffic addressed to their customers, something very likely to raise 
privacy concerns. And finally, even if carriers screened traffic, it 
could still be difficult to identify and separate ``bad'' robomessages 
from ``good'' auto-dialed messages such as a high volume of identical 
messages announcing airline flight delays or a school system letting 
families know of a weather delay or cancellation.
                                 ______
                                 
     Response to Written Questions Submitted by Hon. Dan Coats to 
                          Michael F. Altschul
    Question 1. I commend the work the Federal Communications 
Commission (FCC) and the Federal Trade Commission (FTC) have done in 
establishing a national Do-Not-Call Registry pursuant to their 
authorities under the Telephone Consumer Protection Act (TCPA). The 
registry is nationwide in scope, applies to all telemarketers (with the 
exception of certain non-profit organizations), and covers both 
interstate and intrastate telemarketing calls. Recently, I have heard a 
number of concerns from my state regarding the regulation of high 
volume auto-dialer initiated voice over Internet protocol (VOIP) 
``broadcasted'' calls. My understanding is that these calls can put 
10,000 calls per minute onto Indiana's landline telephone network, by 
using VOIP technology, in an attempt to get around Indiana's Do Not 
Call List. Does the technology exist to identify these high volume, 
auto-dialer initiated calls in real time?
    Answer. Network traffic management technologies exist that can 
identify a high volume of calls delivered to a carrier at an 
interconnection point. However, robo-callers can thwart these 
technologies by routing calls over different paths, limiting the volume 
of calls presented at any one point, using a mix of messages and a mix 
of spoofed Caller ID addresses to disguise the common origin of these 
calls. Moreover, there are lawful high volume auto-dialer calls sent 
with the recipient's express consent (airline flight delays, school 
closings, etc.) and there is no technology that provides real-time 
identification of lawful versus unlawful high volume calls.

    Question 1a. My understanding is that when phone calls are made, 
there are usually two user-facing identifiable pieces of information: a 
phone number and a Caller ID Name (CNAM). I understand that the CNAM 
can be used to display the calling party's name alongside the phone 
number, to help users easily identify a caller. I have also been told 
that there are numerous CNAM lookup services which allow you to pay a 
small fee to lookup the CNAM of a specified caller (by phone number). 
Do any prohibitions exist to prevent this practice by telemarketers?
    Answer. I am not aware of any such prohibitions, but question 
whether such look-ups will be useful in changing the behavior of serial 
robocallers, as those entities are most likely spoofing their numbers 
to defeat Caller ID or routing traffic to make identification of its 
origin difficult. See, for example, http://800notes.com/forum/ta-
19b1ccea03917e7/scammers-now-spoofing-good-phone-numbers and http://
www.cou
rthousenews.com/2011/08/16/39024.htm. Additionally, the blocking of 
calls based on CNAM data could result in the blocking of legitimate 
calls.
                                 ______
                                 
    Response to Written Questions Submitted by Hon. Mark Warner to 
                             Matthew Stein
    Question 1. Over the past year or so, my office has seen a marked 
increase in calls and letters regarding possible abuses by some 
telemarketers. Since January 2013, my office has heard from more than 
300 people requesting assistance with the Do Not Call List, and since 
taking office in 2009, my office has heard from over 1200 people on 
this issue. A small sampling of some of the concerns we have received 
are also included in this document for the record.*
---------------------------------------------------------------------------
    \*\ Selected Constituent Robocall Concerns

    ``It is an invasion of our privacy, and it ties up our phones and 
disrupts our lives to get as many as 15 calls every single day when we 
have been on the donotcall list since day 1. Anything you can do about 
this issue will be greatly appreciated.''
      --Constituent from Arlington, VA 5/26/2012

    ``I am registered on the ``Do Not Call'' list for my home phone 
(not cellphone) and I am still getting many solicitation ``robo calls'' 
for lower credit card rates, car warranties, and other commercial 
products. Some callers block caller ID. I systematically report these 
callers via the ``report a violator'' process on the Registry website. 
I have been on the do-not-call registry since its inception, and I have 
verified this on the Registry site. I also put my elderly mother's home 
phone number on the DNC Registry several years ago. She also gets many 
solicitation calls. I am well versed on the types of calls that the DNC 
system is supposed to address, and the kinds of calls that are 
excepted. I am astonished at the number of calls I am getting even as I 
am on the DNC list.''
      --Constituent from Fairfax, VA 05/04/2012

    ``xxx-xxx-xxxx [redacted]. This number continues to call with 
impunity, even though they are on my FTC Do Not Call Registry, and 
several other residents I'm friends with. They are scam artists, trying 
to mine personal information, and the FTC hasn't responded to my 
concerns. Are you game for going after this group of obvious scammers, 
because a lot of vulnerable citizens, could be prey for their scam 
which involves lowering debt. They call themselves [redacted], and they 
are a company I and others have never done business with. Thank you 
kindly.''
      --Constituent from Fairfax, VA 06/06/2012

    ``I have been getting calls on my home phone from a 'Credit Card 
Services' for over a year now. I have submitted at least five 
complaints on the FTC website and at least two complaints' on the 'Do 
Not Call' website. I have asked to speak to a supervisor numerous 
times, only to be hung up on. I have told them over and over and over 
again to not call me. I have threatened them with FTC complaints. I 
have received over 30 calls from this company and have turned in many 
complaints to the Federal Trade Commission and nothing seems to work. 
If you look on the internet, you will see tens of thousands of 
complaints. Therefore, I would like to request that you (my 
congressmen) get the Federal Trade Commission to do their job and shut 
these people down.''
      --Constituent from Alexandria, VA 07/23/2012

    ``Over the last couple of months, I've been getting an increasing 
number of robo-dialer/recorded commercial calls in violation of the Do-
Not-Call registry. Many have been from the same 'crook', often ``Credit 
Card Services.'' I've reported most of them on the FTC's Do Not Call 
registry. (That is not counting the growing number of political calls, 
which unfortunately are not violations of Do Not Call).''
      --Constituent from Reston, VA 08/20/2012

    ``Senator--Please have someone on your staff Google (xxx)xxx-xxxx 
[redacted] and you will see several websites dedicated to complaints 
about harassing phone calls from this number asking if we want to 
refinance our VA loan. We have been on the Do Not Call list since 2006 
and have asked them to stop calling us 6-8 times a day. They pointedly 
refuse to stop. This is not about freedom of speech, it is invasion of 
privacy. I, on behalf of many, many people request my Federal 
Government figure a way to make these people stop calling over and over 
again.''
      --Constituent from Yorktown, VA 08/27/2012

    ``My name is [redacted] and I reside in Charlottesville, VA. I am 
in the fourth grade. I am writing to ask that you help by intervening 
in the issue of unsolicited phone calls. Our number is on the Do Not 
Call list. In the last two days we've received three such calls.''
      --Constituent from Charlottesville, VA 05/23/2012
---------------------------------------------------------------------------
    As a supporter of the Do Not Call Act, I sympathize with the 
frustration of my constituents. I recognize that the same technology 
that is allowing telephone service providers to more efficiently manage 
networks is also enabling disreputable callers to abuse the system.
    Still, it seems to me that if we can't find a technical solution to 
abusive telemarketing calls, that raises many serious questions as 
well. I encourage you to think more creatively about possible 
solutions, and about any legislative authorities that would better 
enable the FTC to keep pace with technology. For instance, have similar 
problems occurred in other countries? If so, are there any solutions 
adopted in other markets that might be applicable in the U.S.?
    Answer. Primus Canada confirms that issues related to mass 
unsolicited calling, including abusive telemarketing calls (together, 
``telemarketing''), are not unique to the U.S. and are of a similar 
significant concern to its customers in Canada. In response to these 
concerns, Primus Canada invented, developed and deployed a patented 
technological solution called Telemarketing Guard to assist its 
customers with this issue.
    Telemarketing Guard provides customers with control over how they 
wish to deal with telemarketing calls. When a Primus Canada customer 
receives a call identified as a telemarketing call by the Telemarketing 
Guard system, the call is impeded and does not go directly to the 
customer. Instead, a message is played advising that the customer does 
not accept telemarketing calls and invites the caller to announce 
themselves. The customer then has the choice to accept the call, refuse 
the call or send the call to voice-mail.
    Importantly, Telemarketing Guard uses the actions of customers to 
identify potential unsolicited telemarketing calls. When a customer 
receives an unscreened telemarketing call, the customer is able to 
report the call to the Telemarketing Guard system. When a threshold of 
customers reporting the same number is reached, the system begins to 
monitor the calling phone number and applies a number of behavioral 
characteristics (e.g., frequency of calling, time of day concentration, 
sequential calling, etc.) to determine whether the call should be 
identified as a telemarketing call on a going forward basis. In 
essence, the system promotes and relies on customer engagement to 
identify potential telemarketing calls.
    Notably, the response by Primus Canada's customers has been 
exceptional. Based on internal surveys, the service has increased 
customer satisfaction and become one of the leading reasons that 
customers choose to keep their phone service with Primus Canada.
    Accordingly, Primus Canada is of the view that Telemarketing Guard 
represents the very type of creative solution contemplated in this 
Question for the Record.

    Question 2. In 2012, the Federal Trade Commission (FTC) challenged 
innovators to come up with a solution that would block illegal 
commercial robocalls on landlines and mobile phones. One of the 
proposed solutions creates a filtering system, similar to an e-mail 
spam filter, that intercepts and filters out illegal robocalls using a 
technology that ``blacklists'' and ``whitelists'' phone numbers. The 
proposal envisions a consumer-facing system, however, others have 
suggested that a network-based system might be more efficient and less 
burdensome for consumers. Do you believe that a filtering system would 
be effective? If so, do you believe it should be implemented by 
networks or by consumers? If not, do you have ideas for a better 
solution?
    Answer. As noted in response to the first Question for the Record, 
Primus Canada provides a service called Telemarketing Guard that 
enables its customers to control how they wish to address mass 
unsolicited calling (``telemarketing'').
    Telemarketing Guard service is distinct from technologies that rely 
on the use of blacklist and whitelists solutions (``list solutions'') 
to intercept and filter out telemarketing calls, including illegal 
robocalls, as it relies on dynamic information to identify potential 
telemarketing calls. Specifically and as described in response to the 
first Question for the Record, Telemarketing Guard uses the actions of 
customers and the application of behavioural characteristics to 
determine whether a call should be identified as a telemarketing call.
    Primus Canada is of the view that the use of dynamic information 
has a number of significant advantages relative to the reliance on the 
type of static information that is generally associated with 
administered list solutions. For example, the use of static information 
requires significant manual administration, oversight and intervention. 
This is necessitated by the fact that being placed on a blacklist has a 
number of significant ramifications to the calling party. As a result, 
a process is required to validate that a number should be blacklisted 
to protect against the erroneous or mischievous reporting of telephone 
numbers. A dispute process is also required to address claims that a 
number should not have been, or should no longer be, placed on the 
blacklist.
    In comparison, the use of dynamic information by the Telemarketing 
Guard system alleviates these concerns. For example, concerns of 
erroneous or mischievous reporting are addressed as a call is 
identified as a potential unsolicited call only after a threshold of 
reports by customers is reached and behavioral characteristics are 
applied. Similarly, dispute processes are not required as a number will 
cease being identified as a potential unsolicited caller if customers 
stop reporting calls from that number.
    As for implementation, Primus Canada views Telemarketing Guard as 
both a network-based and customer-facing solution. Indeed, 
Telemarketing Guard relies on customer provided information and 
engagement to identify telemarketing calls. Customers may also enable 
and disable the service at will, though few select the latter option. 
On the other hand, implementation in the network ensures that customers 
can benefit from the service without, for example, having to purchase 
equipment or software, actively participate in reporting or continually 
update individual lists.
    For these reasons, Primus Canada has selected to implement 
Telemarketing Guard in its network and in a manner that relies on 
dynamic information to identify potential telemarketing calls.
                                 ______
                                 
     Response to Written Questions Submitted by Hon. Dan Coats to 
                             Matthew Stein
    I commend the work the Federal Communications Commission (FCC) and 
the Federal Trade Commission (FTC) have done in establishing a national 
Do-Not-Call Registry pursuant to their authorities under the Telephone 
Consumer Protection Act (TCPA). The registry is nationwide in scope, 
applies to all telemarketers (with the exception of certain non-profit 
organizations), and covers both interstate and intrastate telemarketing 
calls. Recently, I have heard a number of concerns from my state 
regarding the regulation of high volume auto-dialer initiated voice 
over Internet protocol (VOIP) ``broadcasted'' calls. My understanding 
is that these calls can put 10,000 calls per minute onto Indiana's 
landline telephone network, by using VOIP technology, in an attempt to 
get around Indiana's Do Not Call List.

    Question 1. Does the technology exist to identify these high 
volume, auto-dialer initiated calls in real time?
    Answer. Yes, the technology to identify and address high volume 
auto-dialer initiated calls exists. In fact, Primus Canada has invented 
and deployed a service since 2007 that enables its customers in Canada 
to address such examples of mass unsolicited calling.
    Primus Canada provides a service called Telemarketing Guard to all 
of its telephone customers in Canada. This service enables its 
customers to report a received telemarketing call (including auto-
dialer initiated calls) to the Telemarketing Guard system.
    When a threshold of customers reporting the same number is reached, 
the system begins to monitor the calling phone number and applies a 
number of behavioral characteristics (e.g., frequency of calling, time 
of day concentration, sequential calling, etc.) to determine whether 
the call should be identified as a telemarketing call on a going 
forward basis.
    When a Primus Canada customer receives a call identified as a 
telemarketing call by the system, the call is impeded and does not go 
directly to the customer. Instead, a message is played advising that 
the customer does not accept telemarketing calls and invites the caller 
to announce themselves. The customer then has the choice to accept the 
call, refuse the call or send the call to voice-mail.
    Accordingly, in the example put forward in the question, the auto-
dialer initiated VoIP calls would be identified and impeded by the 
Telemarketing Guard system when the threshold of customers reporting 
the number is reached.
    In essence, Telemarketing Guard promotes and relies on the choices 
and actions of Primus Canada's customers to identify unwanted 
telemarketing calls. If enough customers accept a call from an 
identified telemarketer, the number will similarly cease to be 
considered a telemarketing call by the Telemarketing Guard system.
    Accordingly, Primus confirms that the technology exists to identify 
high volume, auto-dialer initiated calls.

    Question 2. My understanding is that when phone calls are made, 
there are usually two user-facing identifiable pieces of information: a 
phone number and a Caller ID Name (CNAM). I understand that the CNAM 
can be used to display the calling party's name alongside the phone 
number, to help users easily identify a caller. I have also been told 
that there are numerous CNAM lookup services which allow you to pay a 
small fee to lookup the CNAM of a specified caller (by phone number). 
Do any prohibitions exist to prevent this practice by telemarketers?
    Answer. Primus is not aware of any prohibitions that exist that 
prevent this practice by telemarketers.
                                 ______
                                 
    Response to Written Questions Submitted by Hon. Mark Warner to 
                               Aaron Foss
    Question 1. Over the past year or so, my office has seen a marked 
increase in calls and letters regarding possible abuses by some 
telemarketers. Since January 2013, my office has heard from more than 
300 people requesting assistance with the Do Not Call List, and since 
taking office in 2009, my office has heard from over 1200 people on 
this issue. A small sampling of some of the concerns we have received 
are also included in this document for the record.*
---------------------------------------------------------------------------
    \*\ Selected Constituent Robocall Concerns

    ``It is an invasion of our privacy, and it ties up our phones and 
disrupts our lives to get as many as 15 calls every single day when we 
have been on the donotcall list since day 1. Anything you can do about 
this issue will be greatly appreciated.''
      --Constituent from Arlington, VA 5/26/2012

    ``I am registered on the ``Do Not Call'' list for my home phone 
(not cellphone) and I am still getting many solicitation ``robo calls'' 
for lower credit card rates, car warranties, and other commercial 
products. Some callers block caller ID. I systematically report these 
callers via the ``report a violator'' process on the Registry website. 
I have been on the do-not-call registry since its inception, and I have 
verified this on the Registry site. I also put my elderly mother's home 
phone number on the DNC Registry several years ago. She also gets many 
solicitation calls. I am well versed on the types of calls that the DNC 
system is supposed to address, and the kinds of calls that are 
excepted. I am astonished at the number of calls I am getting even as I 
am on the DNC list.''
      --Constituent from Fairfax, VA 05/04/2012

    ``xxx-xxx-xxxx [redacted]. This number continues to call with 
impunity, even though they are on my FTC Do Not Call Registry, and 
several other residents I'm friends with. They are scam artists, trying 
to mine personal information, and the FTC hasn't responded to my 
concerns. Are you game for going after this group of obvious scammers, 
because a lot of vulnerable citizens, could be prey for their scam 
which involves lowering debt. They call themselves [redacted], and they 
are a company I and others have never done business with. Thank you 
kindly.''
      --Constituent from Fairfax, VA 06/06/2012

    ``I have been getting calls on my home phone from a 'Credit Card 
Services' for over a year now. I have submitted at least five 
complaints on the FTC website and at least two complaints' on the 'Do 
Not Call' website. I have asked to speak to a supervisor numerous 
times, only to be hung up on. I have told them over and over and over 
again to not call me. I have threatened them with FTC complaints. I 
have received over 30 calls from this company and have turned in many 
complaints to the Federal Trade Commission and nothing seems to work. 
If you look on the internet, you will see tens of thousands of 
complaints. Therefore, I would like to request that you (my 
congressmen) get the Federal Trade Commission to do their job and shut 
these people down.''
      --Constituent from Alexandria, VA 07/23/2012

    ``Over the last couple of months, I've been getting an increasing 
number of robo-dialer/recorded commercial calls in violation of the Do-
Not-Call registry. Many have been from the same 'crook', often ``Credit 
Card Services.'' I've reported most of them on the FTC's Do Not Call 
registry. (That is not counting the growing number of political calls, 
which unfortunately are not violations of Do Not Call).''
      --Constituent from Reston, VA 08/20/2012

    ``Senator--Please have someone on your staff Google (xxx)xxx-xxxx 
[redacted] and you will see several websites dedicated to complaints 
about harassing phone calls from this number asking if we want to 
refinance our VA loan. We have been on the Do Not Call list since 2006 
and have asked them to stop calling us 6-8 times a day. They pointedly 
refuse to stop. This is not about freedom of speech, it is invasion of 
privacy. I, on behalf of many, many people request my Federal 
Government figure a way to make these people stop calling over and over 
again.''
      --Constituent from Yorktown, VA 08/27/2012

    ``My name is [redacted] and I reside in Charlottesville, VA. I am 
in the fourth grade. I am writing to ask that you help by intervening 
in the issue of unsolicited phone calls. Our number is on the Do Not 
Call list. In the last two days we've received three such calls.''
      --Constituent from Charlottesville, VA 05/23/2012
---------------------------------------------------------------------------
    As a supporter of the Do Not Call Act, I sympathize with the 
frustration of my constituents. I recognize that the same technology 
that is allowing telephone service providers to more efficiently manage 
networks is also enabling disreputable callers to abuse the system.
    Still, it seems to me that if we can't find a technical solution to 
abusive telemarketing calls, that raises many serious questions as 
well. I encourage you to think more creatively about possible 
solutions, and about any legislative authorities that would better 
enable the FTC to keep pace with technology. For instance, have similar 
problems occurred in other countries? If so, are there any solutions 
adopted in other markets that might be applicable in the U.S.?
    Answer. I am the co-winners of the FTC Robocall Challenge and I 
think that there most definitely are technological solutions to this 
problem. Many of the entries to the FTC Robocall Challenge had very 
creative uses of inexpensive technology. Computer processing power is 
getting faster and cheaper by the day. Building a system to fingerprint 
robocaller calling patterns is definitely within reach.
    Question 2. In 2012, the Federal Trade Commission (FTC) challenged 
innovators to come up with a solution that would block illegal 
commercial robocalls on landlines and mobile phones. One of the 
proposed solutions creates a filtering system, similar to an e-mail 
spam filter, that intercepts and filters out illegal robocalls using a 
technology that ``blacklists'' and ``whitelists'' phone numbers. The 
proposal envisions a consumer-facing system, however, others have 
suggested that a network-based system might be more efficient and less 
burdensome for consumers.
    Do you believe that a filtering system would be effective? If so, 
do you believe it should be implemented by networks or by consumers? If 
not, do you have ideas for a better solution?
    Answer. I do believe that a filtering system would be effective in 
reducing the amount of robocalls that get to consumers' phones. Even 
simple blocking techniques would dramatically reduce the number of 
calls that interrupt and annoy consumers.
    I believe that the solution should be jointly implemented by the 
networks and consumers. The carriers should offer it as an additional 
service, but it would have to be enabled (opt-in) by the consumer. Most 
enhanced services such as call waiting and call forwarding are offered 
this way today. Consumers should ultimately have the tools available to 
them to block the calls that they don't want to receive.
                                 ______
                                 
     Response to Written Questions Submitted by Hon. Dan Coats to 
                               Aaron Foss
    I commend the work the Federal Communications Commission (FCC) and 
the Federal Trade Commission (FTC) have done in establishing a national 
Do-Not-Call Registry pursuant to their authorities under the Telephone 
Consumer Protection Act (TCPA). The registry is nationwide in scope, 
applies to all telemarketers (with the exception of certain non-profit 
organizations), and covers both interstate and intrastate telemarketing 
calls. Recently, I have heard a number of concerns from my state 
regarding the regulation of high volume auto-dialer initiated voice 
over Internet protocol (VOIP) ``broadcasted'' calls. My understanding 
is that these calls can put 10,000 calls per minute onto Indiana's 
landline telephone network, by using VOIP technology, in an attempt to 
get around Indiana's Do Not Call List.
    Question 1. Does the technology exist to identify these high 
volume, auto-dialer initiated calls in real time?
    Answer. I think that there most definitely are technological 
solutions to this problem. Many of the entries to the FTC Robocall 
Challenge had very creative uses of inexpensive technology. Computer 
processing power is getting faster and cheaper by the day. Building a 
system to fingerprint robocaller calling patterns is definitely within 
reach.

    Question 2. My understanding is that when phone calls are made, 
there are usually two user-facing identifiable pieces of information: a 
phone number and a Caller ID Name (CNAM). I understand that the CNAM 
can be used to display the calling party's name alongside the phone 
number, to help users easily identify a caller. I have also been told 
that there are numerous CNAM lookup services which allow you to pay a 
small fee to lookup the CNAM of a specified caller (by phone number). 
Do any prohibitions exist to prevent this practice by telemarketers?
    Answer. I am aware of some companies that allow high-volume callers 
to display customized CNAM data however I don't know about the legality 
around this practice.

                                  
