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December 10th, 2019

The US House of Representatives recently passed the “Pallone-Thune Telephone Robocall Abuse Criminal Enforcement and Deterrence Act,” or “TRACED Act.”  If written into law, the TRACED Act would implement a number of changes to the TCPA landscape, such as the creation of a new Interagency Working Group and new anti-spoofing requirements.  Most notably for our readership, the TRACED Act imposes new TCPA penalties in the form of civil forfeiture, adding to the already significant penalties that exist today for violations of the TCPA.

What new TCPA penalties and provisions will come into effect if the TRACED Act is signed into law?

Civil Forfeiture Added as Possible TCPA Penalty

On top of the already steep penalties for TCPA violations ($500 per violative telephone call/text message, $1,500 for each willful or knowing violation), the proposed language of the TRACED Act imposes a new civil forfeiture penalty for intentional violations of the TCPA and leaves enforcement largely at the discretion of the Federal Communications Commission (“FCC”).  Specifically, the bill states that if done “with the intent to cause such violation . . .” TCPA violations will result in “an additional penalty not to exceed $10,000.”  For the FCC to hold a person liable for this civil forfeiture penalty, that person must receive proper notice from the FCC of her/his/its apparent liability and be afforded an opportunity for a hearing before the FCC or an Administrative Law Judge.      

Generally speaking, this civil forfeiture penalty would afford the FCC greater latitude to punish those who intentionally violate the TCPA.  In fact, the bill mandates that the FCC submit an annual report to Congress detailing the FCC’s enforcement of, and punishment for, TCPA violations that occurred in the preceding year. 

Other Notable Provisions of the TRACED Act

 Beyond TCPA penalties, the TRACED Act includes several other notable provisions:

• STIR/SHAKEN Authentication Software: To authenticate the source of calls and prevent unnecessary robocalls, the TRACED Act requires telecommunications service providers to implement Secure Telephone Identity Revisited (“STIR”) and Signature-based Handling of Asserted Information Using toKENs (“SHAKEN”) software to help consumers identify spoofed calls.
• Interagency Working Group: The Attorney General and Chairman of the FCC are directed to convene an interagency working group “to study Government prosecution of violations of [the TCPA],” and review possible TCPA enforcement actions.
• Information Sharing Regarding Robocall and Spoofing Violations: Within 18 months of enactment of the TRACED Act, the FCC would be tasked with implementing regulations that create a process that “streamlines the ways in which a private entity may voluntarily share with the [FCC] information relating to [TCPA violations].”
• FCC to Report Robocall Violations to the Attorney General: The Chief of the Enforcement Bureau for the FCC must provide evidence of “willful, knowing, and repeated robocall” violations to the Attorney General and publish a report related to TCPA enforcement.

What the TRACED Act’s TCPA Penalties and Provisions Mean for Businesses

While the TRACED Act has not yet been signed into law, if and when it is, it will result in significant ramifications for businesses.  First, the TRACED Act would increase potential TCPA penalties for intentional violations of the statute and afford the FCC significant discretion with respect to enforcing such penalties.  Given its focus on rulemaking, the TRACED Act would force the FCC to continuously make and monitor TCPA-related rules, causing the TCPA landscape to periodically shift more than it does already.  This will, inevitably, lead to an even greater number of TCPA lawsuits than we see already. We will continue to monitor this legislation and provide follow up blog analysis in the future.  

If you are interested in learning more about this topic or require assistance in connection with TCPA compliance for your business, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.

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The material contained herein is provided for informational purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney. Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.

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