FTC set to sue companies making spam 'robo-calls' for car warranties
WASHINGTON -- Federal regulators are close to filing lawsuits against companies behind a national wave of spam "robo-calls" that warn people their auto warranties are about to expire and offer new service plans, two senators said Tuesday.
The Federal Trade Commission has started investigations into several companies involved in the deceptive calls, and the agency expects to bring cases against them within days, Sens. Charles Schumer, D-N.Y., and Mark Warner, D-Va., said at a news conference. The FTC also is providing a link on its website for consumers to file complaints.
The message "Your Car Warranty Has Expired," offering a deal on an extended warranty, already has brought some 300,000 inquiries and 4,000 complaints to the Better Business Bureau from consumers who received the calls over the past two years. The calls come even if the consumer has signed up for the national "Do Not Call" registry, which is maintained by the FTC.
"Law enforcement action in this area can be expected imminently," FTC Chairman Jon Leibowitz said Monday in a letter to Schumer. A spokeswoman for the agency declined further comment Tuesday.
Schumer had asked for an investigation by the agency into what he calls a scam of "robo-dialer harassment." The computerized calls can eat up a consumer's cellphone minutes, possibly jacking up phone charges, Schumer said.
The calls target people regardless of whether they have warranties or even own cars and have become such a nuisance that officials in 40 states are investigating the companies behind them.
About three dozen companies offer contracts similar to insurance policies, pledging to pay for car repairs in exchange for fees paid up front, according to the Better Business Bureau. They call numbers randomly and leave messages with a computerized voice telling people, falsely, that their auto warranties are about to expire.
"Out of warranty? You are still eligible to reactivate warranty coverage. This is the final call before we close the file." The recording typically gives the caller an option to stop receiving calls, but they continue to come even if consumers opt out, the officials say.
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