A Miami-based company accused of routing foreign-based robocalls into the United States is the target of a federal lawsuit by Florida Attorney General Ashley Moody seeking to stop the alleged operation.
Smartbiz Telecom LLC has continued to "facilitate the transmission of millions of foreign-based robocalls into the U.S.," Moody's office said in a news release about the suit that was filed Monday in U.S. District Court in Miami.
The suit alleges violations of federal laws barring telemarketing fraud, the federal Telephone Consumer Protection Act, and Florida's Deceptive and Unfair Trade Practices Act.
Smartbiz Telecom did not respond to an email seeking comment about Moody's action. The company does not list its phone number on its website.
According to the lawsuit, the company was routing fraudulent robocalls that told U.S.-based consumers that their Amazon accounts had been frozen, that their Social Security numbers were being suspended, or that they qualified for a reduced credit card interest rate.
"At best these calls are annoying, but for many they lead to catastrophic financial losses," the lawsuit states. It adds that fraudulent robocalls are the most common contact method for scams, and consumers reported losing more than $692 million to fraudulent robocalls in 2021 alone.
The Industry Traceback Group, a watchdog group appointed by the Federal Communications Commission to trace origins of illegal robocalls, notified Smartbiz at least 250 times since April 2020 about fraudulent or illegal calls traversing its network, the lawsuit states.
Despite those notifications - along with letters from the traceback group and discussions with the Attorney General's Office - about ways in can reduce or eliminate fraudulent calls on its network, Smartbiz "has chosen profit over people and refuses to implement meaningful procedures to prevent perpetration of serious fraud on its network," the suit states.
Robocalling technology enables placement of large volumes of calls over a short period of time, according to the lawsuit.
"A robocaller can make multiple calls in a single second. These calls can deliver prerecorded or artificially voiced messages, or they can allow a computer to listen for the call to be answered and then connect the call to a live operator," the suit says.
The technology "is particularly attractive to scammers because it allows them to efficiently place millions or billions of calls as they troll for vulnerable consumers who may fall victim to their scams," it says.
Overseas robocallers pay only for the calls that targets answer, according to the suit, which enables the companies to make huge numbers of call attempts "for free."
Calls' origins are disguised through use of simulated or spoofed phone numbers and Smartbiz accepts the traffic "without ever checking whether the purported [originating] phone numbers appear facially legitimate," the lawsuit claims.
The lawsuit says Smartbiz also routinely transmits calls with numbers spoofed to make them appear as if they are from a U.S. government agency, such as the Social Security Administration, banks, utilities, law enforcement agencies, large companies such as Apple or Microsoft, and even 911.
The large number of similar companies that provide call-routing services makes it unlikely that an injunction against Smartbiz will significantly reduce the overall volume of robocalls made to U.S. consumers, according to the CEO of a popular robocall blocking service.
Robocall volumes might be reduced temporarily, but overseas companies will find other U.S.-based providers to take their place, said Alex Quilici, CEO of YouMail.com. "There are plenty of folks out there who would be happy to look the other way," and route all the traffic, Quilici said.
YouMail helped the Industry Traceback Group target Smartbiz by providing data used to traceback various calls, he said. YouMail's website estimates that 4.7 billion robocalls were placed to U.S. consumers in November, a 3.8% increase over October.