Scimeca: Give consumers choice and control over robocalls

Americans received 78 billion robotexts during the first half of 2023, a staggering increase of 18%. According to Robokiller, a spam-blocking service that publishes annual statistics on spam calls and political text messages, spam increased by over 300% from 2020 to 2022 and again in 2023.

More than an incessant avalanche of migraine-inducing annoyances, robotexts pose a genuine threat to data privacy and have a record of attempted election interference.

Under rising public irritation with unwanted text messages, in 2019 Congress imposed various mandates on robocalls even though pro-consumer regulations like the Telephone Consumer Protection Act (TCPA) already existed. Unfortunately, like many top-down government solutions, these add-on mandates have exacerbated the problem.

Pooling their resources together in a well-meaning effort to vet robocalls and texts as mandated by Congress, phone carriers created a monopolistic entity called The Campaign Registry (TCR). Managed by Aegis Mobile, Congress’s plan to reduce robotexts instead resulted in a rapid rise in spam texts.  

The FCC and FTC have scrutinized Aegis Mobile’s auditing and vetting practices to disappointing conclusions. In one case, Verizon hired Aegis to perform background checks that sought users’ location to ensure they were legitimate companies with no consumer protection issues. The FCC found that Aegis failed, calling its review systems inadequate.

In another, Aegis refused to comply with an FTC subpoena stemming from the Commission’s concerns about potential predatory business practices, which prompted court intervention. It is little wonder why, then, spam texts and calls still run rampant on consumers’ phones.

Concerns over election interference have also been raised related to TCR-Aegis’ vetting services. A recent lawsuit from TCR’s co-founder accused the company’s vetting operations of intentionally blocking messages of Arizona Republican Kari Lake’s senatorial campaign to benefit the company’s favored candidate. Per the lawsuit, he alerted TCR to this problem, but the company told its operational head, “…to let it go and not do anything.”

Former congressman Mark Schauer, who is now the Vice President of Winning Connections, a voter mobilization firm, has expressed public concerns that former Aegis chairman Jeff Goettman, a former Trump appointee who now serves as Chief of Staff to Virginia Governor Glenn Youngkin, is an Aegis investor who continues to draw an annual income in excess of $250,000 from the firm.

Foreign influence over this vetting system is a further concern. According to Securities and Exchange Commission filings, Kaleyra — TCR’s parent company — has Chinese investors, including Hong Kong Permanent Shine Limited and Y Intercept Hong Kong Ltd. In his lawsuit, TCR’s co-founder alleges that Kaleyra “has refused to answer what percentage of the company is owned, directly or indirectly, by individuals or entities associated with the People’s Republic of China” and whether they have direct or indirect access to the companies’ data. Have these ties influenced TCR’s operations?

The FCC reported text message scams and robotext complaints increased by over 425% from 2015 to 2022. With ongoing reports of voters receiving false political information from robotexts, such as fake texts about candidates dropping out of races and other election misinformation, the current system is clearly not working.

It’s time for Congress to “fix the glitch” they created. At a minimum, correcting this problem should involve more congressional oversight over TCR-Aegis Mobile.

In October, Sen. Ben Ray Luján’s, D-New Mexico, of the Subcommittee on Communications, Media and Broadband, held a hearing titled “Protecting Americans from Robocalls.” The hearing was a promising start to build awareness of the issue to lawmakers. Still, it did not address the systemic issues or propose any substantive remedies.

Congress should also consider reversing some of the more oppressive mandates it implemented over the robocall and message system to encourage more contractor competition within the vetting system, a pro-consumer reform in the direction of greater fairness and equity.

Washington’s goal should not be to outright stop political texts and calls, nor repeat their top-down intrusion that exacerbated the problem. Consumer choice should be the driving force of its decision-making. Companies and campaigns that violate terms of service and continue to message consumers against their wishes should face severe penalties, as should the entities responsible for the estimated $13 billion in losses the American people experienced in the first half of 2023 from robotext frauds and scams.

With the presidential primary season now in full swing and congressional campaigns soon to follow, Congress should act expeditiously to address this problem. In a politically divided nation, a cease-fire on spam calls and messages should be uniquely unifying. Let’s hope Congress hears our call to deliver the protection consumers deserve.

Gerard Scimeca is an attorney and chairman of CASE, Consumer Action for a Strong Economy, a free-market oriented consumer advocacy organization which he co-founded.