25 Attorneys General Agree: Close Government’s Robocall Debt-Collection Loophole

Last fall, with a government shutdown looming, Congress passed an emergency spending bill that also included a lovely little loophole giving the federal government the authority to make obnoxious, pre-recorded and/or autodialed debt-collection robocalls. Some lawmakers quickly introduced legislation intended to correct that anti-consumer move, but it’s been stuck in committee since. This week, attorneys general from two dozen states and District of Columbia called on the Senate to finally consider this legislation.

In a letter [PDF] sent to Sen. John Thune (SD) and Sen. Bill Nelson (FL) — respectively the Chair and Ranking Member of the Senate Commerce Committee — the 25 attorneys general urge the committee to pass the Help Americans Never Get Unwanted Phone calls [HANGUP] Act introduced last November by Massachusetts Senator Ed Markey.

Just like their counterparts at the Federal Trade Commission and the FCC, these AGs say they are inundated with complaints about robocalls.

“Each year, the largest number of consumer complaints our offices receive are about unwanted telemarketing calls, with robocalls and debt collection calls at the top of the list,” reads the letter.

Until the passing of that October spending bill, the Telephone Consumer Protection Act [TCPA] prohibited most non-emergency robocalls to cellphones unless the recipient has given their prior express consent to receive auto-dialed calls.

But, tacked on to the October bill was a clause that amended the TCPA to allow robocalls if they are made “solely to collect a debt owed to or guaranteed by the United States.”

The attorneys general write that “It is inappropriate to grant debt collectors the right to harass citizens simply because the debt has a nexus to the federal government when the law specifically prohibits all other private and public entities, including political callers, from doing so.”

The bill gave the FCC a nine-month window to craft rules reflecting this change, so the robocalls have not started, but when the rules eventually do kick in, anyone who may have missed a federal student loan payment, have a federal tax issue, a problem with their FHA-insured home loan, or any other debt to the government could be on the receiving end of unwanted pre-recorded calls.

And because there is often no human being on the other end of the line, good luck trying to tell the federal government that it has the wrong number.

“By passing the HANGUP Act, the federal government has the opportunity to stop the barrage of debt collection robocalls that can be misdialed, at times harassing and frustrating our citizens who pay for such calls to their cellular numbers,” reads the letter.

Putting aside the annoyance factor — and the wrong number concern — for a moment, the government’s own analysis of how much revenue these robocalls could generate raises the question of whether it’s even worth it.

The Congressional Budget Office figures it could even lose as much as $500,000 a year for the government. Best case scenario is that it nets $500,000 a year.

For people who agree with the AGs and want to close this loophole, our colleagues at Consumers Union have an online portal where you can tell your state’s senator that you support the bill.

The lead authors of the letter were Missouri AG Chris Koster and Greg Zoeller of Indiana. They were joined in signing by Mark Brnovich (AZ), Cynthia Coffman (CO), George Jepson (CT), Karl Racine (DC), Doug Chin (HI), Derek Schmidt (KS), Andy Beshear (KY), Janet Mills (ME), Brian Frosh (MD), Maura Healey (MA), Lori Swanson (MN), Jim Hood (MS), Tim Fox (MT), Joseph Foster (NH), Hector Balderas (NM), Eric Schneiderman (NY), Roy Cooper (NC), Ellen Rosenblum (OR), Peter Kilmartin (RI), Herbert Slattery (TN), Sean Reyes (UT), William Sorrell (VT), and Robert Ferguson (WA).