1 billion robocalls net $225M FCC fine that will likely never be collected

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The Federal Communications Commission today proposed a $225 million fine for health-insurance telemarketers who "made approximately 1 billion spoofed robocalls across the country during the first four and a half months of 2019." But the FCC's track record in collecting on proposed fines is so poor that the fine is unlikely to ever be collected at anywhere close to the proposed amount.

Rising Eagle, a Texas-based health insurance telemarketer, made 1 billion calls "on behalf of clients that sell short-term, limited-duration health insurance plans," the FCC said. Here's how the FCC described the robocalls:

The robocalls falsely claimed to offer health insurance plans from well-known health insurance companies such as Aetna, Blue Cross Blue Shield, Cigna, and UnitedHealth Group. For example, one call stated: "Are you looking for affordable health insurance with benefits from a company you know? Policies have all been reduced nationwide such as Cigna, Blue Cross, Aetna, and United just a quick phone call away. Press 3 to get connected to a licensed agent or press 7 to be added to the Do Not Call list." If they did press 3, consumers were transferred to a call center with no affiliation to the named companies, where call center representatives then would attempt to convince the consumer to purchase an insurance product sold by one of Rising Eagle's clients. Rising Eagle's largest client, Health Advisors of America, was sued by the Missouri Attorney General for telemarketing violations in February 2019.

The proposed $225 million fine is for "apparent violations by John C. Spiller and Jakob A. Mears, who used business names including Rising Eagle and JSquared Telecom," the FCC said. It's a proposed fine because that's how the FCC process works: the commission issues a Notice of Apparent Liability for Forfeiture containing allegations, and the alleged robocaller is given an opportunity to respond and provide evidence. The process can end in a settlement or a fine that cannot exceed the proposed amount of $225 million. The amount of $225 million would be the largest-ever FCC fine, but the commission has a disappointing track record in collecting on these proposed penalties.

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