- XCast, the Voice over Internet Protocol (VoIP) provider was ordered by the FTC to pay a $10 million civil penalty which was suspended due to its inability to pay.
- The company faced charges for assisting other firms in reaching people on the National Do Not Call Registry and misleading them into making purchases or donations.
- XCast is required to implement a screening process and sever ties with businesses that violate US telemarketing laws as part of the proposed settlement.
The FTC’s Move Against XCast
The Federal Trade Commission (FTC) directed the Voice over Internet Protocol (VoIP) service provider, XCast, to settle a $10 million civil fine. This decision was later suspended due to the company’s financial incapacity. In a case of financial misrepresentation by XCast, the fine becomes immediately payable, as per the FTC’s statement.
The Los Angeles-based VoIP provider, XCast has faced legal actions from regulators for allegedly facilitating other enterprises in breaching the National Do Not Call Registry to approach customers and trick them into making transactions or donations. This follows multiple warnings previously issued to the company.
The FTC’s Director of Bureau of Consumer Protection, Samuel Levine, clearly stated that firms supporting illegal robocalling practices should be prepared to be held accountable by the FTC.
DOJ Supports FTC’s Actions
Brian Boynton, the Principal Deputy Assistant Attorney General of the U.S. Department of Justice’s Civil Division, emphasized on Tuesday that their department is actively striving to safeguard American consumers from unlawful robocalls and prevent telecom providers from encouraging such practices.
Terms of XCast’s Proposed Settlement
In the proposed settlement submitted to the U.S. District Court for Central District of California, XCast has been directed to employ a screening protocol and discontinue its connections with entities that fail to adhere to U.S. telemarketing regulations.
Efforts to get a response from XCast representatives on the proposed settlement were unsuccessful.
This ruling against XCast could strengthen regulatory oversight, potentially impact trading patterns, and serve as a warning to other VoIP providers.