The U.S. Department of Justice (DoJ) has announced a settlement with VoIP service provider XCast over allegations of facilitating illegal telemarketing campaigns since at least January 2018, violating the Telemarketing Sales Rule (TSR). The stipulated order, while prohibiting further violations, mandates compliance measures, including customer screening processes to detect potential illegal telemarketing. Due to XCast’s financial inability to pay, the order imposes a $10 million civil penalty judgment but remains suspended. XCast was accused of transmitting billions of illegal robocalls, including scams falsely claiming affiliation with government agencies, and sending prerecorded marketing messages to numbers on the National Do Not Call Registry.
As part of the proposed settlement, XCast is required to sever ties with firms violating U.S. telemarketing laws, and the order permanently bars the company from providing VoIP services to entities lacking an automated procedure to block calls with invalid Caller ID or unauthenticated through the FCC’s STIR/SHAKEN Authentication Framework. The U.S. Federal Trade Commission (FTC) noted that XCast Labs took no action despite repeated warnings about illegal robocallers using its services. The development aligns with the FTC’s broader efforts to combat illegal robocalls, including a recent ban on Response Tree, preventing them from making calls to numbers on the Do Not Call Registry.
In a separate case, the FTC announced a ban on Response Tree, accusing the Californian company of operating over 50 websites that used manipulative dark patterns to collect consumers’ personal information for supposed services. These websites, including PatriotRefi.com and AbodeDefense.com, allegedly sold the gathered information to telemarketers who made millions of illegal robocalls and telemarketing calls nationwide. The ban prohibits Response Tree from making or assisting others in making such calls or contacting numbers on the Do Not Call Registry. The FTC’s actions underscore its commitment to curbing unlawful telemarketing practices and holding companies accountable for facilitating or participating in these activities.
