A federal civil enforcement action was filed May 12 against XCast Labs for allegedly violating the Telemarketing Sales Rule by assisting and facilitating illegal telemarketing campaigns.
According to a complaint filed in the U.S. District Court for the Central District of California, XCast Labs provided Voice over Internet Protocol (VoIP) services that transmitted billions of illegal robocalls to American consumers, including scam calls that fraudulently claimed to be from government agencies.
The robocalls delivered prerecorded marketing messages and many of them were delivered to numbers listed on the National Do Not Call Registry, failed to truthfully identify the seller of the services being marketed, falsely claimed affiliations with government entities, contained other false or misleading statements to induce purchases, or were transmitted with “spoofed” caller ID information.
Since at least Jan. 1, 2018, XCast has, through its VoIP services, “transmitted billions of illegal robocalls that sellers and telemarketers placed to American consumers” in violation of the Telemarketing Sales Rule, the government alleges.
Some of the calls marketed goods and services “with a history of deceptive sales practices, such as extended automobile warranties.” Many of the illegal robocalls XCast transmitted were “fraudulent telemarketing scams,” the government charges.
They include, for example, robocalls falsely claiming affiliations with government entities such as the Social Security Administration, threatening to cut off a call recipient’s utility service unless they make immediate payments, or claiming that a call recipient’s credit card has been charged and they must act promptly to have the charge refunded.”
XCast’s own records of the calls it transmits “make clear that it has transmitted huge numbers of illegal calls,” according to the federal complaint. XCast’s call data records include information such as the exact date and time of a call, the calling number, the called number, and the exact duration of the call.
XCast records of calls it transmitted for just three of its customers, for example, revealed that nearly two billion of those calls were placed to telephone numbers on the national Do Not Call Registry.
The federal complaint alleges that XCast Labs, based in Los Angeles, continued to allow its services to transmit these calls even after being alerted to their illegality.
The complaint – filed by the U.S. Department of Justice and the Federal Trade Commission – seeks monetary civil penalties and a permanent injunction to prohibit the defendant from future violations.
“The Department of Justice is committed to stopping telecommunications providers from enabling unscrupulous telemarketers to bombard American consumers with illegal robocalls,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division.
XCast Labs “played a key role in helping telemarketers flood homes with unlawful robocalls, including robocalls impersonating the Social Security Administration,” said Director Samuel Levine of the FTC’s Bureau of Consumer Protection. “VoIP providers like XCast Labs that bury their head in the sand when their customers use their services to break the law can expect to hear from the FTC.”