Hanging up on Rachel: Robo-calls have been banned, yet the phones keep ringing

"Hi. This is Rachel from Cardholder Services." It's safe to say that millions of Americans have received a call from Rachel or one of her robo-calling cohorts at some point. In fact, there have been so many complaints about calls from robo-dialers with pre-recorded announcements that the government has almost entirely banned them.

As of September 1, the Federal Trade Commission barred all prerecorded telemarketing calls unless a consumer givestheir written permission to receive them furst. Robo-soliciting over cell phones was already prohibited by the Federal Communications Commission several years ago.

Just don't tell that to Rachel. She doesn't appear to be slowing down -- and, at least for the time being, no one can stop her because it's not clear where she comes from.
Efforts to track down the source of pre-recorded calls from Rachel and her associates, all of which offer similar spiels about taking them up on their "final" offer to help you lower your credit card interest rate, have proven elusive. Internet message boards are cluttered with theories about who Rachel's enablers are and what they really want -- as well as complaints about just how annoying it can be to get calls from some machine you can't stop. The system offers you an option to opt out of the calls. It doesn't work.

The prime suspect in this calling spree has been DHC Financial Services Group -- a Florida-based debt refinancing company. Just last month, Indiana's attorney general wrapped up an investigation into DHC for allegedly violating state restrictions on telemarketing using robo-dialers and recorded messages. The case was resolved with an "Assurance of Voluntary Compliance. That's attorney general-speak for settling the case for a sum of money and a promise from the accused that they will never again do what it was they were accused of -- even though they admitted to no wrongdoing.

DHC was represented by former Indiana Attorney General Jeffrey Modisett, who did not respond to requests for comment on the case or the company. Indiana officials say they believe the company, which was registered in Florida in April is now out of business. Indeed, the company web site is gone, but that sort of thing happens a lot, particularly in Florida, where companies launch, cause problems and disappear when the heat cranks up.

Molly Butters, a spokeswoman for Indiana Attorney General Greg Zoeller, said it isn't unusual to see companies that get in trouble go belly up. "A lot of times in these types of cases we'll find there's nothing left," she told WalletPop. "As far as getting them stopped: We accomplished that."

A very similar company with the same owner has already popped up. We'll see if this one turns to Rachel to make its pitches.

If Rachel or one of her pals gives you a ring, tell your attorney general, the FCC and the Federal Trade Commission.

"The more information we get, the more likely it is that we can make a complaint," FTC spokesman Mitch Katz told WalletPop. "It cannot hurt to go on the FTC web site...and file a complaint."

After the robo-calling ban went into effect, he says the FTC saw an increase in the number of complaints. That, Katz said, is normal after a new regulation goes into effect and the public becomes aware of it.

The Better Business Bureau has received a mountain of complaints against robo-calling solicitors and urges people who get the credit card pitch to ditch it. "It is just beyond us that people would apply for this," BBB spokeswoman Allison Southwick said in an interview.

According to Southwick, the company behind the robo-call actually does what it says it will do: Call your credit card company on your behalf to request an interest rate reduction. Except, she said, all they do is put the consumer on a three-way call to the toll-free number on the back of their credit card and ask if their rate could be lowered. Any consumer can do this on their own, but if they use one of these companies, they can expect to be charged $700 to $1,000.

"It's a lot of money for something you can do for free," Southwick said.

She said hundreds of people complained, but many more were hindered because they had no idea who was calling them. "We know the complaints that we received were just the tip of the iceberg," she said. "Not knowing who's calling you is a big deterrent to filing a complaint."
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