Lawyers Win Again
Robocalls
I have written about robocalls, and given my background in marketing, I thought I had a good grasp on what was causing the robocall plague, and how to stop it. However, Walt Hickey has proven me wrong with this excellent piece on why we can’t seem to stop robocalls:
First is the technological, as advances have magnified fundamental flaws in the American phone system enabling unrelenting robocalls from untraceable origins.
The second is financial: because of that, it's incredibly profitable to use spam calls to drive business whether the caller is a scammer trying to bilk money out of marks or an actual business using telemarketing to increase sales.
Lastly is the legal situation, with a series of enormous court decisions — with one more on the way — so far paving the way for telemarketers to get away with blowing up your phone scot-free, with next to no legal recourse and under-funded enforcement just trying to keep the lid on.
Let’s break these issues down one at a time. First, the US telephone system is dumb, because of course it is, and illegal robocallers can flood it with spam with little fear of reprisal:
The robocaller is able to place their calls through a gateway carrier, which is a telecommunications company willing to place those calls to American phones. The gateway carrier may not always know they're laundering scam calls into the US telecom system, but they're often targets of FTC enforcement. Once the call is on US soil, it passes through the patchwork of carriers to your phone.
Oh, and also, caller ID is bullshit:
"Caller ID was never verified," Foss said. In the 1980s when caller ID was first implemented, there was only one phone company — AT&T — and as they were able to verify customers, caller ID was implemented the same way that a return address on an envelope was, where a person could put anything.
Then AT&T was broken up, and deregulation meant anyone could become a carrier, and the FCC laws that effectively protect the privacy of you as a phone user are equally capable of protecting bad actors, as well. As a result, caller ID is meaningless yet still relied on, which makes it easy for scammers to exploit.
Incredible. If you were wondering why you get robocalls with spoofed names and numbers, this is why. The other, somewhat logical reason carriers don’t simply ban robocalls outright is that a lot of companies and organizations use automated reminder calls for things like doctor appointments or prescription pick-ups, and banning those would cause chaos.
Okay, so our phone systems are terrible. With robocalls so common hardly anyone answers their phone, how are they profitable? They’re incredibly cheap to generate:
The economics of phone spam are incredibly favorable. For perspective, 125,000 minutes of robocalls from Message Communications Inc — which sustained a $25,000 penalty in 2015 for what the FTC described as "willful, repeated" violations — has sold for a mere $875. Assuming a consumer listens to the call for an average of three seconds, that $875 would translate into 2.5 million calls, with one cent getting a buyer 28 spam calls.
Even if just one out of every 10,000 calls turns into a qualified lead, at a going rate of $7 per lead, an hour of robocalls will pull in $1,750 in revenue, neatly doubling their investment.
The fact you can buy 2.5 million robocalls for less than a thousand dollars is staggering, but not surprising. Our phone systems were not built with cloud computing in mind. And, mixed in with all the scams, fraud, and illegal stuff are real robocalls people did request, like an automated callback from the cable company or a response to a form submitted online. For many industries - especially those with complex sales processes, like insurance companies - the phone is still the best way to close customers, and the best way to get in touch with them is to have a computer dial their phone and hope they answer.
I do have firsthand data when it comes to who picks up the phone - unsurprisingly, it is older people. I ran advertising campaigns - “lead gen” - targeted at both younger and older people, and older people answered the phone almost twice as often. Unfortunately, bad actors can exploit the trust of the elderly to sell them things they don’t need, or steal from them outright.
So what are carriers and lawmakers doing about it? Well, unfortunately, things are going in the wrong direction at the moment, in part due to the money behind robocalls:
…an Insider analysis found that the federal lobbyists employed by pro-robocall businesses outnumbered the anti-robocall consumer groups' lobbyists by a factor of 100 to 1.
And because the Supreme Court weakened the law that allowed citizens to sue robocallers:
The 2016 6-2 Supreme Court decision in Spokeo Inc. v. Robins has had broad implications in the rise of spam robocalling. Spokeo came to mean that being annoyed isn't enough to sue an illegal telemarketer in federal court. A plaintiff needs to be injured, which makes it much harder to build a case against telemarketing operations doing flagrantly illegal things that rarely injure people.
Again, as someone who had to deal with TCPA compliance at my old job, I can see why the court feels this way - clogging the judicial system with millions of $1,500 lawsuits to get robocallers to chill is not a solution, though it is (and was) a very American attempt at one.
So what is the government doing that may actually work? The FTC is now starting to pursue gateway carriers and dialing platforms, the robocall laundering services who feed the really bad stuff into the system:
Taking down just one entity can have a drastic impact, as seen in the 2018 FTC complaint against Jamie Christiano and the company TelWeb, which the agency said was responsible for creating and hawking "a computer-based telephone dialing platform" behind billions of illegal robocalls.
The government is also rolling out a new detection system for robocallers who spoof numbers, but that’s not expected to catch everything. Oh, and also, because the COVID-19 pandemic is beginning to slow, countries where a lot of robocalls originate - India, Pakistan - are going to ramp up their output in the near future, so expect your phone to blow up more than usual. Fun!
Oh, and Facebook might be about to make text spam a lot worse for Americans, as if they haven’t done enough damage to the fabric of our society in the last few years:
Last November, the Supreme Court heard oral arguments in a case with enormous implications for the sanctity of your phone. Several years ago, someone linked their telephone number to their Facebook account. They eventually gave up that telephone number, and in 2014 it was assigned to Noah Duguid, a person who does not even have a Facebook account.
When Facebook began texting that number repeatedly about suspicious activity on the account of the previous number's owner, Dugiud asked them to stop texting him. When they didn't, he sued. The case wound its way through the legal system and, after Duguid won at the Ninth Circuit court of appeals, Facebook took the case to the Supreme Court. At issue now is whether Facebook used what under the TCPA is an automated telephone dialing system, but as tends to be the case with legal matters escalated to the Supreme Court, it's about more than that.
Essentially, if Facebook and the many business groups backing their legal case win, robocallers and texters will have far more freedom to spam you without your permission.
So, what can we do as Americans unfortunate enough to own cell phones? Experts recommend installing a spam blocking app on your phone, and it should go without saying that you should not answer calls you don’t recognize, or give any information to scammers. You could also call your Congressperson, since they’re pretty much required to answer the phone.
Ken Paxton
Remember this dipshit? Well he’s being sued by Twitter:
Twitter has filed a lawsuit against Texas Attorney General Ken Paxton, claiming the Republican used his office to retaliate against it for banning the account of former President Donald Trump following the riot at the U.S. Capitol.
Days after the deadly January insurrection, Paxton announced an investigation into Twitter and four other major technology companies for what he called “the seemingly coordinated de-platforming of the President.” The attorney general’s office demanded that the companies produce a variety of records related to their content moderation policies and troves of internal communications.
Twitter responded Monday with a federal lawsuit alleging Paxton is seeking to punish it for taking Trump’s account offline — a decision the social media company says is protected free speech. It asks a judge to declare the decision to be under the ambit of the First Amendment and to, in essence, halt Paxton’s investigation.
At this point, the Republican Party runs purely on grievance, but Ken Paxton may have done an actual First Amendment violation by filing retaliatory lawsuits against tech companies accusing them of violating the Trump’s right to free speech. While he’s under investigation for abuse of power after a bunch of his senior staff blew the whistle on him and resigned. And is still pending trial for the financial fraud he did before taking office. Aren’t state politics amazing?
Flint
We’ve talked about Flint a few times, as the court cases and criminal investigations wound through the system. The latest news involves the civil lawsuit against the city by the victims of the lead and chemical poisoning:
Attorneys representing Flint residents in their proposed $641-million settlement of claims related to the city’s water crisis would receive roughly $202 million in attorney fees, according to a proposal filed Monday, March 8, in federal court.
Listen, I have no problem with attorneys being paid for their time. It’s one of the perks of being an attorney - you get to charge clients by the hour, or take a cut of a settlement if you work on contingency. But once you start getting into amounts this large, it calls into question whether that money was earned.
This piece in the Detroit Free Press debates whether the eye-popping fee request is in line with other class action suits, or whether it’s appropriate, and that’s fine. Lawyers live to debate these sorts of things. To me, this bit stands out:
However, the lead attorneys have put in 182,571 hours, which amounts to more than $84.5 million, the court filing said.
So the lead attorneys in the Flint water case, which happened seven years ago, have put in twenty one years’ worth of time on the case? Really? I don’t know, man.
I have a lot of thoughts on attorneys’ fees and whether things could be settled without the help of expensive lawyers, and, to me, the Flint case is a good example. There is no doubt the town and state administrators did a bad thing and it poisoned their citizens. That is not in dispute! Now, after years of legal wrangling and all the money the city and state have spent defending themselves in court, Flint has to come up with $641 million dollars to pay its own citizens for poisoning them, and the lawyers are taking a third of it? I am not a mayor, or a city official, but it seems like this could have been resolved in a much more cost-effective way for all parties.
Speaking of Lawyers
After facing online hatred, Senate hearings, and backlash from a slew of other scandals over the past couple of years, Robinhood is now faced with 49 lawsuits. That’s right, 49 — all because of GameStop. The trading platform made a filing with the SEC on Friday, stating that it was being hit with “46 putative class actions and three individual actions.”
The Matt Levine theory applies here - at a certain point, anything and everything is securities fraud. I am imagining securities lawyers ordering their paralegals to go on WallStreetBets and start DMing random Redditors to ask if they’ve been harmed by Robinhood. Do the lawyers find the meme kids, or do the meme kids find the lawyers? How does any of it work? Are some of the class actions made up of hedge funds located in different states? Why is this all so stupid?
Short Cons
MIT Tech Review - ““When you’re in the business of maximizing engagement, you’re not interested in truth. You’re not interested in harm, divisiveness, conspiracy. In fact, those are your friends,””
OneZero - “A meta-review of 1,000 studies found that the science tying our facial expressions to our emotions isn’t entirely universal. People make the expected facial expression to match their emotional state only 20% to 30% of the time, the researchers said.”
The Guardian - “Belgian, Dutch and French police said they had hacked into the Sky ECC network, allowing them to look “over the shoulders” of suspects as they communicated with customised devices to plot drug deals and murders.”
ARS Technica - “In late 2017 and early 2018, McAfee urged his hundreds of thousands of Twitter followers to invest in a number of obscure cryptocurrencies. Prosecutors say he failed to disclose his own financial stake in those tokens—and in some cases outright lied about it.”
Tips, thoughts, or unwanted robocalls to scammerdarkly@gmail.com