An Irvine company has been caught with its hand in the consumer cookie jar, accused of duping hundreds of thousands of unsuspecting individuals into handing over personal details that were peddled to telemarketers, as the Federal Trade Commission revealed. The federal regulator has come down hard on Response Tree LLC and its president Derek Thomas Doherty, hammering out a proposed $7 million settlement to put an end to these alleged deceptive practices.
Under the weighty settlement, which is still pending court approval, Response Tree and Doherty will be banned from the age-old art of robocalling and assisting others to do so, especially to those who have made their peace by signing up to the national Do Not Call Registry. This move comes after the FTC claimed to have exposed a sprawling web of more than 50 websites that functioned as "consent farms," luring consumers with the illusion of mortgage refinancing loans and services that were never to materialize. Instead, these sites were harvesting data to sell as leads, according to statements obtained by the OC Register.
The FTC alleges that from January 2018 to May 2021, more than 85,000 outbound telephone calls were made to consumers based on the falsely obtained consents from just a single Response Tree website. Samuel Levine, director of the FTC’s Bureau of Consumer Protection, minced no words, stating "The FTC will continue to target every corner of the illegal telemarketing ecosystem to protect consumers and hold wrongdoers accountable."
Not only were Response Tree's websites set up to fool consumers into providing their personal information, but they also used manipulative "dark patterns" to obscure the true intent behind the collecting of data. The lawsuit hammered home the point, alleging the company knew full well they were selling these so-called leads without the necessary consents for the subsequent flood of robocalls and telemarketing campaigns, "TheRetailRewards.com," and "AbodeDefense.com" among other websites were specifically called out in this intricate con, according to the FTC's own press release.
If the court signs off on the deal, the substantial $7 million judgment will hover over Response Tree and Doherty like a dark cloud, suspended only by their claim of an inability to pay. Yet, should it be discovered they were less than truthful about their financial state, the full sum will be due immediately. Stripped from their toolbox is the ability to sell, transfer, or disclose any consumer data connected with lead generation activities, clamping down on what the FTC sees as the lifeblood of illegal telemarketing tactics.
