In-Depth: Rep. Anna Eshoo (D-CA) reintroduced this bill from the 115th Congress to protect anyone with a federally-backed loan (student loans, mortgages, veteran loans, farming loans) from unwanted robocalls and texts:
“The American people are fed up with being harassed by robocalls and texts. What Congress had instituted to protect consumers was rolled back in 2015, subjecting consumers to these incessant barrages. The bipartisan HANGUP Act cracks down on the unacceptable 26 billion robocalls made last year and stops debt collectors from going after Americans who have difficulty paying their federal student loans.”
In March 2016, a coalition of consumer and advocacy groups, including Americans for Financial Reform, Consumer Action, the NAACP, and US PIRG, wrote a letter in support of this bill:
“We write to support strongly the [Hangup Act] to repeal the recent enactment of Section 301 in the 2015 Budget Bill. Section 301 will allow collectors of debt owed to or guaranteed by the United States to make robodialed and prerecorded calls and texts to cell phones without consent. Section 301 of the budget bill opens the door to unwanted robocalls to cell phones for student loan borrowers, veterans, farmers, mortgage borrowers, taxpayers, and others with debt backed by the federal government. The provision would also allow robocalls to borrowers' relatives, their references, as well as any unrelated person who has the reassigned cellphone number of these parties. Section 301 removes the current requirement for a caller to have the consent of the called party before making autodialed or prerecorded calls or texts for the collection of debts owed or guaranteed by the federal government. Section 301 will only foster more abuses from an industry already known for its abuses of consumers. Cell phone calls can distract people while driving, interrupt them at their jobs, and needlessly impose a cost on struggling families by using up scarce minutes. Though the provision is limited to debts owed or guaranteed by the federal government, millions of consumers will be affected, including graduates who can't pay their loans due to a terrible job market, homeowners who are behind in mortgages, and people who are in tax disputes with the Internal Revenue Service. Families who have lost their homes to foreclosure could be exposed to cell phone calls for years if the delinquency on their mortgage is sold to debt buyers.”
This bill has six Democratic House cosponsors in the 116th Congress. A Senate version, sponsored by Sen. Ed Markey and one Republican cosponsor, Sen. Mike Lee (R-UT), was also introduced in February 2019. This bill was introduced in both of the last two congressional sessions, but didn’t see action either time. However, this year, legislators are hopeful that increased FCC of robocalls and the public outcry against them will improve this bill’s odds of passage.
Of Note: In 2018, Americans received over 26 billion robocalls — up 46 percent from 2017. In a letter to her Congressional colleagues seeking cosponsors for this bill, Rep. Eshoo notes that unwanted calls are the top source of consumer complaints to the Federal Communications Commission and the Federal Trade Commission. She also notes that “stunningly, one of the most dominant type of robocalls comes not from typical scammers, but in fact from federal debt collecting contractors.”
Section 301(b) of the Bipartisan Budget Act of 2015 allowed an exception to restrictions in the Telephone Consumer Protection Act of 1991 (TCPA) to allow calls and text messages “made solely to collect a debt owed to or guaranteed by the United States.” This exception took effect in August 2016, and was applauded by trade groups, including ACA International, which stated that “it shows an understanding in government that limiting dialing technology for legitimate debt collection doesn’t make sense.” However, Rep. Eshoo’s office contends that the TCPA rule’s removal has led to “millions more robocalls made not just to the original consumer, but often are directed to their relatives, references, or even employers.”
The TCPA, signed into law in 1991, was enacted in response to a rise in unregulated, harassing telemarketing calls and faxes. It restricts telephone solicitations (telemarketing) and the use of automated phone equipment, as well as the use of pre-recorded voice messages, automatic dialing, and SMS and fax use. Without explicit customer consent, companies must adhere to strict solicitation rules, solicitors must honor the National Do Not Call Registry, and subscribers may sue a company that does not follow the TCPA guidelines.
If passed, this bill would put the federal government on par with other debt collectors, barring it from robocalling without consent and opening the government up to TCPA liability and creating a new group of TCPA plaintiffs who owe debt on government loans. Given recent reports saying over 20 percent of federal student loans are in default, this bill could have a major impact on the government’s debt collection practices or leave it subject to a wave or new TCPA exposure.
Summary by Lorelei Yang(Photo Credit: iStockphoto.com / PhonlamaiPhoto)