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End robocalls! Are these nuisance calls going the way of rotary phones?

Phone scams cost consumers an estimated $350 million in financial losses annually

Published: June 19, 2015 04:35 PM

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Just a day after the Federal Communications Commission hit AT&T with a record $100 million fine for slowing download and upload speeds for its unlimited data plans, the FCC voted to help consumers with two more concerns: robocalls and connecting low-income Americans to the Internet.

Robocalls, robotexts, and telemarketing calls are the FCC's leading source of consumer complaints. Commissioners voted 3-2 to make it easier for consumers to say "no" to unwanted calls and texts by putting stricter rules in place and closing loopholes in the law.

FCC Chairman Tom Wheeler made a point of saying phone companies can—should—offer tools for Americans to block robocalls. In the past, some phone companies have resisted doing so, maintaining they did not have the legal authority. But this FCC order makes it clear that the companies can offer this technology without violating FCC rules.

Earlier this year, Consumers Union, the policy and advocacy arm of Consumer Reports, launched the End Robocalls campaign, calling on the major phone companies to provide free, effective tools to block unwanted calls. More 330,000 consumers have signed Consumers Union's petition to the carriers.

"Americans have had enough with robocalls that ring off the hook all day long, and often target them with the latest scams," says Tim Marvin, Consumers Union's End Robocalls campaign manager. "The FCC vote means the phone companies should stop stalling and start providing their customers with free tools to block these calls."

Read more about robocalls, including how robocalls scam the Do Not Call List and tips for stopping robocalls and telemarketers.

More than 217 million phone numbers have been registered on the Federal Trade Commission's Do Not Call registry. Yet robocalls persist as scam artists ignore the lists and use the latest technology to hammer people with calls day and night. Phone scams cost consumers an estimated $350 million in financial losses annually, and we're pleased to see the FCC cracking down on them.

In a separate action, commissioners voted to consider reforming and modernizing a program called Lifeline. The program was started in 1985 during the Reagan administration to help low-income Americans pay for phone service.

Today, Lifeline offers a $9.25 monthly credit for eligible people to put toward landline phone service or wireless plans. Chairman Wheeler wants to expand the program so people can apply the credit to phone service or broadband. The plan would also strengthen oversight and administration of Lifeline, and take additional measures to eliminate waste, fraud, and abuse.

Consumers Union is a longtime supporter of Lifeline because it helps consumers in need get critical communications services. We applaud this effort to restructure the program and connect more Americans to broadband. This vote starts the process of gathering public comments and developing a rule, and we plan to speak out on the need for it.

Delara Derakhshani, policy counsel for Consumers Union, said, "People need broadband more than ever to find a job, keep a job, stay informed, and manage their day-to-day lives. Yet we still have a serious gap where millions of Americans don't have access to affordable broadband. The FCC's plan will help close the broadband gap and make Lifeline more relevant and impactful for a lot more people."

This feature is part of a regular series by Consumers Union, the policy and advocacy arm of Consumer Reports. The nonprofit organization advocates for product safety, financial reform, safer food, health reform, and other consumer issues in Washington, D.C., the states, and in the marketplace.

Read past installments of our Policy & Action feature.

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