Together with the Florida Attorney General, the Federal Trade Commission filed suit against Lifewatch for allegedly using deceptive robocalls to urge older consumers to sign up for medical alert systems with a recurring monthly charge.
Last year the regulators settled with one of Lifewatch's telemarketing partners. The new federal complaint charged New York-based Lifewatch with direct responsibility for the illegal activities in that case and the deceptions in its current robocall campaign with other telemarketing companies.
The FTC and Florida AG alleged that since 2012, the defendant targeted seniors with "hundreds of millions" of robocalls, often claiming that a medical alert system had already been purchased for them and they could receive it "at no cost whatsoever."
Pre-recorded messages were placed to consumers on the National Do Not Call Registry that used "spoofed" caller ID information. If a consumer pressed a number to speak with a live operator, the FTC and Florida AG said they were pressured by the telemarketer to take advantage of a one-day offer to receive the system—which cost more than $400—for free.
Consumers were informed that their credit card or bank account information was necessary to pay a monthly monitoring fee for the system. Although they were also told that they would not be billed until they actually received and activated the system, they were charged a typical monthly fee between $29.95 and $39.95 "almost immediately." Lifewatch also made cancellation difficult, the FTC and Florida AG added, and some consumers were informed they had to either pay to return the system at their own expense or pay a $400 penalty.
For the alleged violations of Florida's Unfair and Deceptive Trade Practices Act, the Federal Trade Commission Act and the FTC's Telemarketing Sales Rule, the complaint requested the court to enjoin the deceptive practices and order consumer restitution.
To read the complaint and memorandum in support of an injunction in FTC v. Lifewatch, click here.
Why it matters: Lifewatch's attempts to evade liability by pointing the finger at its telemarketing partners did not convince the FTC or the Florida AG, particularly as the company persisted in its activities even after the regulators shut down one of its telemarketers last year. "The simple truth is that Lifewatch is well aware of, and responsible for, the illegal tactics employed by its telemarketers," the regulators argued in their motion in support of an injunction. "These tactics are not the unavoidable result of bad conduct by a few rogue telemarketers—these tactics are responsible for making Lifewatch the company it is today."