Recently, the twelve largest telecom providers and the attorneys general of all fifty states and Washington, D.C., entered into an agreement aimed at identifying and deterring robocalls. Although this agreement is intended primarily to help combat the use of robocalls, to make spam calls illegal and to protect consumers, the agreement’s emphasis on broader access to call-blocking functionality will likely pose challenges for a wide range of legitimate callers, including creditors and debt collection agencies. This is just the latest example of heightened governmental focus on robocalls, including regulatory and legislative efforts that similarly hinge on call-blocking programs. These developments will almost certainly require significant adaptation on the part of legitimate callers, many of whom currently rely on automated call technology to efficiently contact high volumes of customers.

The agreement sets forth eight principles. At the outset, these principles call for telecom carriers to provide call blocking tools and functionality to their customers. The agreement emphasizes that these tools should be easy-to-use and available to consumers free-of-charge. Other principles involve commitments to monitor networks for robocall activity and to swiftly deploy the caller identification framework known by the acronym SHAKEN/STIR (which, as noted below, the Federal Communications Commission (“FCC”) has already proposed as a regulatory requirement in its recent notice of proposed rulemaking). The remaining principles require the carriers to investigate suspicious calls and calling patterns, to conduct at least limited due diligence on and confirm the identity of new customers (a “Know Your Customer” requirement for telecom carriers), to require a contractual commitment from upstream providers to cooperate with investigations, to devote sufficient staff and resources to assist with investigations, and to keep the attorneys general apprised of emerging scams and developing trends as well as evolving technological solutions to illegal robocalls.

While this agreement is clearly aimed at addressing the growing volume of fraudulent calls placed to consumers by means of robocall technology, efforts to combat robocalls risk entangling legitimate business uses of automated dialing technology, including calls by creditors and collection agencies. By emphasizing broader use and availability of call-blocking tools and technology, the agreement risks deepening the challenges for legitimate calls. For example, if a consumer uses call-blocking features to refuse all incoming calls from unknown numbers not already included in that consumer’s contact list, a creditor would be unable to contact that consumer by phone. As a result, efforts to combat fraudulent robocalls by relying on aggressive call-blocking programs, while well intended, could cause unintended operational problems and challenges for financial institutions and other legitimate callers—while simultaneously posing significant frustrations to their consumer customers. Creditors, collection agencies, and other parties with a legitimate business need to efficiently contact consumers will need to adapt and evolve as anti-fraud efforts continue.

This week’s memorandum of understanding is just the latest in a series of robocall developments at the federal level. In June, the FCC adopted a declaratory ruling and issued a notice of proposed rule-making. The FCC’s declaratory ruling permits providers to block unwanted calls by default, in addition to so-called “white list” opt-in call blocking functionality aimed at preventing calls from all numbers that are not in the consumer’s own contact list, even if from a legitimate, non-fraudulent caller. The FCC’s notice of proposed rulemaking would “require service providers to implement the SHAKEN/STIR caller ID authentication framework, if major voice service providers fail to do so” by the end of 2019. One potentially mitigating component of the FCC’s approach is that providers may only provide default call-blocking “so long as customers are informed and have the opportunity to opt out of the blocking.” Bipartisan federal legislation known as the TRACED Act (S.151, H.R.1602) is also pending in both the Senate and the House of Representatives, which could result in new prohibitions on a range of robocall techniques, including approaches widely used for legitimate, non-fraudulent business purposes. These are just a few of the developments that creditors, debt collectors, and a wide range of other consumer-facing businesses will need to monitor in order to appropriately adapt critical consumer contact practices in the near future.