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Businesses Are Asking Congress to Weaken Robocall Laws

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Dave Thompson / PA Wire via AP, file

It's one thing Americans agree on: We hate robocalls and we want them stopped.

Companies realize this — and yet, they're asking Congress to weaken the rules and reduce the possible penalties for making illegal robocalls. Consumer groups vow that isn't going to happen without a fight.

In the first four months of this year, the Federal Trade Commission received more than 1.6 million complaints about unwanted calls. Sixty-four percent, or 1.1 million complaints, were for robocalls.

"In the last few years, we've seen an explosion of these illegal calls," said Bikram Bandy, who runs the FTC's National Do Not Call Registry. "Many of the complaints about robocalls are linked to companies that are trying to defraud consumers."

There are 220-million landline and cellphone numbers on the Do Not Call list, but scammers don't care who they call, when they call, or how many times they call.

Consumer Reports estimates that 35 percent of all phone calls placed in the U.S. are now robocalls.

Joel Fischman is one of nearly 33,000 people who have shared their robocall horror stories on the End Robocalls website run by Consumers Union.

Read More: Budget Deal Gives Debt Collectors Authority to 'Robocall' Cellphones

Fischman, who lives in the Washington, D.C. area, told NBC News that he is inundated with robocalls to his landline and cell phone. At one point, he was getting a dozen robocalls a day.

"It's an intrusion and I resent it very much," he said. "Many of these calls are offensive and sinister. All robocalls should be banned."

The rules: Who can and cannot call you

Federal regulations define robocalls as unsolicited pre-recorded telemarketing calls to residential landline phones, and all autodialed or prerecorded calls or text messages to wireless numbers.

All robocalls are not illegal. The rules are different for landline and mobile phones.

A business must have your written permission — on paper or electronically — to make a telemarketing robocall to your phone. Robocalls are allowed to a landline phone without this prior consent if the caller is not trying to sell you something. This would include calls from charities, political parties and survey companies. Informational messages, such as a school closing or flight delay are also exempt.

All autodialed or prerecorded non-emergency calls or texts to wireless phones are prohibited without prior written consent, regardless of the reason for the call.

The FCC does allow a few specific exemptions to this rule as long as the person receiving the call or text is not charged for it. These are for financial alerts — such as possible fraud on a bank account — and health alerts for something like a reminder about a prescription refill. Even so, the consumer has the right to opt-out of getting these permitted alerts at any time.

Brad Herrmann is founder and CEO of Call-Em-All, a company in Frisco, Texas that makes about 10 million legal robocalls to people who want to know about school closings or severe weather alerts and have given prior permission to be contacted. Clients include Amazon, The American Red Cross, Texas Tech University and H&R Block.

"There are times when people need to be contacted quickly and efficiently," Herrmann told NBC News. "Robocall is such a negative word, but people rely on us. They don't think of it as a robocall, it is just information they want."

Herrmann said robocalls are an important means of communication for schools, employers, neighborhood associations, apartment complex managers and religious groups and organizations.

"We loath spam phone calls," he said. "I desperately want the law to get these illegal robocallers, so my business can thrive."

Congress gave debt collectors a pass

A provision in the Bipartisan Budget Act of 2015 made it easier for debt collectors to make robocalls when trying to contact someone about a federal debt, such as a student loan.

In response to this, the FCC has proposed rules that would give consumers the right to stop these unwanted debt collection calls, restrict who can be called (not friends or relatives of a debtor) and limit the number of calls per month. The Commission is taking public comment through June 6.

The Telephone Consumer Protection Act (TCPA) gives the FCC authority to regulate robocalls. Violating the rules can result in fines ranging from $500 to $1,500 per call. Companies also face class action lawsuits from those who received the calls.

Consumer advocates say the ability to take robocallers to court encourages companies to follow the rules. Businesses say it's hurting their ability to communicate with their customers and punishes them for honest mistakes. And they're asking Congress for help.

At a hearing last week, Sen. John Thune (R-South Dakota), chairman of the Commerce Committee, said TCPA litigation has become "a booming business." Robocall lawsuits are now the second most-filed type of cases in federal courts, he said. Last year, 3,710 TCPA lawsuits were filed, a 45 percent increase from 2014.

New robo-call rules: not what they seem?

Sen. Bill Nelson (D-Florida), the ranking member on the committee said the TCPA is "one of the preeminent and most loved consumer protection statues" on the books. The idea of allowing greater access for robocalls to mobile phones without the customer's consent "is an idea that is dead on arrival with the American people," he said in his opening statement.

Arguments for changing the law

The U.S. Chamber of Commerce is asking Congress to make changes to the TCPA. The chamber says it does not want to abolish the law, just update it to balance consumer protection with the potential harm to legitimate businesses.

The "explosion of class action litigation" involving prohibited robocalls to mobile phones - with potential penalties that could reach into the billions — is a serious problem, said Harold Kim, executive vice president of the U.S. Chamber of Commerce Institute for Legal Reform.

"This litigation has created an enormous amount of risk and has had a chilling effect on legitimate businesses, large and small, who are trying to communicate with their customers," Kim told NBC News.

Read More: FCC Gives Phone Companies Okay to Block Robocalls, But Will They?

Faced with damages that could put them out of business, many companies prefer to settle rather than go to court, he said.

The Chamber argues that a law passed in 1991, when few people had cell phones and texting did not exist, needs to be modified to reflect reality. It's estimated that 90 percent of Americans have a cell phone and for nearly half of them, a mobile device is their only form of phone service.

Business groups want, among other things: a cap on damage awards, a statute of limitations, an exemption from legal action for a company acting in good faith or that called a reassigned mobile number that had belonged to a previous customer.

Arguments against weakening the law

Consumer groups are opposed to any changes in the Telephone Communications Protection Act that would reduce liability for calling the wrong number. They say it could result in more robocalls or texts to cellphones.

"If robocalls were a disease, they would be an epidemic," Margot Saunders with the National Consumer Law Center told the Senate hearing.

Saunders testified on behalf of 10 major consumer advocacy groups. Most consumers who receive robocalls do not take the time to complain to a federal agency, and even a tinier percentage (less than two tenths of 1 percent) actually files a lawsuit, she said in her written testimony. She cited one lawsuit where the consumer took legal action after receiving nearly 28,000 unwanted text messages. The company refused to stop despite repeated requests.

"There's no constitutional right to make robocalls," Saunders told NBC News "The problem is not that there are too many lawsuits, the problem is that there are too many robocalls."

Consumer advocates see it this way: The consent requirement is not over-burdensome. A company can ask a customer if they want to be contacted via robocall or text. And they say, if you provide your mobile number as your contact number, you've given that company or organization — whether it's your utility, hospital or airline — permission to use that number to contact you.

They also suggest creating a database of reassigned wireless numbers that companies could check to update their customer robocall permissions.

Woman awarded $230,000 after receiving 153 robocalls 0:50

"If there weren't any illegal robocalls, then there wouldn't be any lawsuits, would there?" said Tim Marvin, who heads up Consumers Union's End Robocalls campaign. "The law should not be weakened. There should not be more legal robocalls. If anything, we should do a better job of stopping these calls and restricting who can make them."

What you can do

There are free services that can help you spot or block robocalls or spam text messages. NOMROBO works on Internet-based (VOIP) phone networks. It will roll out an app for both Android and iOS smartphones in early June.

These apps can also help: TrueCaller and Hiya (Android and Apple), and PrivacyStar (Android) and WhoApp (Apple). These apps all have access to your contacts.

You'll find tips for dealing with unwanted calls and texts and an online complaint form on the FCC website. The FTC also has information about robocalls and an online complaint form on its website.

Herb Weisbaum is The ConsumerMan. Follow him on Facebook and Twitter or visit The ConsumerMan website.