Experts Discuss Enforcement Against Imposter Fraud, Other Consumer Protection Issues

WASHINGTON, December 6, 2022 — Consumer protection efforts from telecommunications companies and federal agencies need to tackle imposter fraud in addition to robocalling, said experts at a Federal Communications Bar Association event Monday.

Imposter fraud is a particularly predatory offshoot of robocalling, involving real individuals instead of or in addition to automated messages. These scams can be very sophisticated and tailored toward individual consumers, panelists said.

By pretending to be associated with the IRS or government aid programs, imposter fraud primarily targets vulnerable communities, including non-native English speakers, low-income individuals and the elderly.

State and federal enforcement agencies should take more aggressive action to stop these bad actors, panelists said.

Another important step toward consumer protection is updating education efforts to reflect the increasing sophistication and complexity of scams. Many consumers rely on security advice that is now outdated, said Harold Feld, senior vice president at Public Knowledge.

“The idea of, ‘Don’t click the link, you should call someone”—well, now they fake numbers,” he said. “So if you call rather than click the link, you’re still talking to a to a criminal.”

While many consumers know to not give out their bank information or social security number, newer scams frequently ask for information that may seem less important, such as utility account numbers. Scammers can then use that information to perpetrate various forms of identity theft.

With scamming tactics changing every few months, telecommunications companies should provide continued consumer education beyond their initial onboarding, said Stuart Drobny, president of Stumar Investigations.

Panelists discussed a variety of actions being taken to combat robocalls, generally describing them as positive steps but not full solutions.

Although STIR/SHAKEN implementation – the Federal Communications Commission’s framework to combat illegal robocalls – has made progress, bad actors have found a workaround by purchasing thousands of legitimate phone numbers, said Diana Eisner, vice president of policy and advocacy at USTelecom.

The FCC’s actions against voice over internet protocol providers are “very promising and so far have been proven to be very effective,” said Len Briley, senior legal counsel for DIRECTV.

Other consumer protection issues involve the ACP and provider disclosures

Panelists also discussed the benefits and weaknesses of the FCC’s Affordable Connectivity Program, which subsidizes internet services for low-income households.

The ACP has been life-changing for many of the program’s participants, Feld said, citing a digital equity report released by Cox on Friday. About half of the survey participants reported that they had been unable to afford home internet prior to the ACP. Nearly all participants reported significant benefits from home internet, particularly for participating in remote learning, accessing educational resources and completing schoolwork from home.

Despite the program’s value, it has also been the subject of multiple fraud controversies. Some of these problems have emerged when consumers are not fully informed about the requirements, Feld said.

“You have lifeline recipients who get a contact from their phone lifeline provider and they say, ‘Hey, we’d like to upgrade you to a new contract,’ and they don’t tell them that it’s an ACP program… and then when [consumers] try to apply their ACP benefit, which is a one per household for a wireline connection, they discover that they can’t because they have used their ACP benefit for wireless.”

In October, Rep. Frank Pallone, Jr., D-N.J., raised concerns about several internet service providers engaging in potential “abusive, misleading, fraudulent, or otherwise predatory behaviors” related to the ACP.

Another FCC consumer protection initiative is the new broadband “nutrition label” requirement, mandating that internet providers display standardized performance metrics, monthly rates and other relevant information at points of sale.

Eisner praised the initiative, saying that the FCC had reached a good balance of ensuring that the labels would present important information without becoming unwieldy or overly complicated.

Although consumer groups called for a requirement that these labels be included on monthly internet bills, this requirement did not make it into the final order. In failing to include it, the FCC “missed something that would be a very significant benefit to consumers,” Feld said.