As attorneys general, we have made it our mission to protect the residents of Michigan and Ohio from illegal robocallers. Robocallers are like a plague of locusts, except these locusts use 21st century technology to swarm through the international telecommunications landscape where they strike in overwhelming numbers, working to scam and defraud thousands of Americans every day, including many of our constituents in Michigan and Ohio. As with any invasion, the best defense is a unified defense – and that’s exactly what our two states are trying to provide.
These scammers are opportunists, capitalizing on our desire to keep our auto warranties up to date and our loved ones safe from national disasters, and even seeking to benefit from a global pandemic. We know the number of Americans losing money to phone scams is on the rise. Truecaller, a phone number identification app, recently reported that 1 in 3 Americans (31%) have fallen victim to phone scams, with 19% or more having been victimized on more than one occasion. They also reported almost $30 billion lost to phone scams from June 2020 to June 2021; almost $10 billion more than in the previous 12 months.(( Truecaller Insights 2021 U.S. Spam & Scam Report – Truecaller Blog last accessed on September 19, 2021. ))
Teaming up to battle robocalls is a natural partnership for the Michigan and Ohio attorneys general. Ohio and Michigan recently partnered with NAAG to host the 2021 Robocall Virtual Summit. The 2-day virtual event was an opportunity for attorney general offices nationwide to join with our federal partners to share experiences, resources, and expertise on how to combat this growing problem. In addition, the Summit provided an opportunity for those in the industry who want to rid their networks of this traffic to explain their efforts to trace these calls and implement new laws.
In addition to hosting the Robocall Virtual Summit, both Michigan and Ohio launched initiatives and teams in the past few years to crack down on illegal robocalls.
Michigan launched a Robocall Initiative that focused on education, enforcement, and legislation. Leading the charge with this Robocall Initiative is a natural extension of the office’s commitment to consumer protection. The Michigan Attorney General’s website provides information and resources so that Michiganders can learn about how robocalls work, why they receive these annoying calls, and how to protect themselves from these bad actors. The Michigan attorney general’s office has also developed an easy path to report robocalls so that we can take swift action to stop them (www.mi.gov/robocalls).
The office is also working with the Michigan legislature to revamp and modernize existing state law to help us fight robocalls. In addition, we’ve stepped up enforcement efforts, spearheading a new legal strategy targeting Voice Over Internet Protocol (VoIP) service providers, who serve as the funnel for illegal robocalls. In 2020, Michigan became the first state attorney general office to impose strict penalties on a VoIP service provider, MODOK, LLC in California, and ban its ownership from the telecom industry for carrying robocalls into Michigan. The Michigan attorney general’s office also was the first law enforcement agency to announce a settlement requiring a major VoIP service provider to implement strict, first-of-their-kind measures to stop illegal robocalls from getting onto the network.
In Ohio, the attorney general’s office created the Robocall Enforcement Unit, a team that is dedicated to rooting out bad actors at every level in the robocall ecosystem. The unit educates Ohioans about robocalls, receives and tracks robocall complaints, and initiates legal action. Launched with the slogan “Just Don’t Answer,” the unit encourages Ohioans to ignore phone calls or texts that they don’t recognize. The unit created an easy-to-use Unwanted Call Notification Form to capture the necessary data to trace and investigate these calls. Ohio was the first state to share data on unwanted calls with the Federal Trade Commission for inclusion in the national clearinghouse, Consumer Sentinel’s Do-No-Call Complaint Database.
The Ohio Attorney General’s office is working with state legislators to fully incorporate the existing prohibitions of two federal statutes into Ohio law, adding new provisions designed to weed out VoIP service providers and other third parties that knowingly facilitate illegal robocalling, and specifically including civil penalties for violations.
As part of these efforts, our offices have also taken several enforcement actions to protect our constituents. Michigan and Ohio partnered with 37 other attorneys general and the Federal Trade Commission to stop a Michigan-based charitable fundraising operation, Associated Community Services, Inc. (ACS), that flooded Americans with 1.3 billion deceptive robocalls resulting in more than $110 million in fraudulent solicitations. Under Consent Judgments with ACS and a number of related defendants, the operators were banned from using robocalls for telemarketing and fundraising and a $500,000 fine was donated to legitimate charities.
Michigan and Ohio also joined six other states in a federal lawsuit against a Texas-based robocalling operation, Rising Eagle Capital Group LLC, and a VoIP service provider JSquared Telecom LLC, that blasted residents across the country with billions of robocalls under the guise of auto warranties and healthcare-related inquiries from 2018 to 2020.
The Michigan Attorney General initiated a case against individuals in the runup to the 2020 Election and charged them criminally for sending robocalls into Detroit in an effort to frighten minority voters away from voting by mail amidst the pandemic. The Michigan attorney general’s office used state-of-the-art investigative techniques that the office helped develop alongside the telecom industry, and partnered with other law enforcement agencies, like the California Department of Justice, to investigate the crime and bring charges against the perpetrators in order to safeguard elections.
Ohio teamed up with the Federal Trade Commission to file the first case against a VoIP service provider, Globex Telecom, for knowingly facilitating robocalls. Not only was this case novel ( as the first action against a VoIP provider), but it also illustrated that the line between start-up VoIP providers and telemarketers can be very blurry. The individual defendants, Mohammed Souheil, the President of Globex Telecom and Sam Madi, another Globex employee, were also key operators of the underlying robocall scam offering credit-card-interest-rate-reduction services. Globex and its subsidiaries, which included an Ohio VoIP provider and two others, now are subject to strict injunctive terms related to client screening and monitoring.
Ohio also brought an action against Madera Merchant Services for its role in processing charges against consumer bank accounts related to student debt relief and credit interest reduction robocall scams, sending the message that no entity aiding illegal robocallers is safe from scrutiny.
We recognize residents still experience robocalls and the fight to end unwanted robocalls continues. But we have made significant gains in this battle. Serious consequences are a deterrent. We believe the work we are doing makes a difference and forces bad actors to think twice before they load Michigan and Ohio area codes into their auto dialers.
Other articles in this edition include:
- Consumer Chief of the Month: Steve Kaufmann, Colorado Attorney General’s Office
- Attorney General Consumer Protection News: September 2021
- Federal Consumer Protection News: September 2021
