The Federal Trade Commission obtained a temporary restraining order against telecommunications companies Disruption Theory and Emergent Technologies for marketing "unlimited" calling plans to the friends and family of prison inmates, even though the plans don't, in fact, provide "unlimited" minutes.
The companies -- which do business as inmatecall.com and inmatecallsolutions.com -- marketed calling plans that make claims such as, "3 Months w/UNLIMITED Minutes," "1 Month UNLIMITED Mins," "90 DAYS OF UNLIMITED TALK," and "We do not charge 'per minute.'" In its complaint, the FTC alleged that although the companies market these calling plans as "unlimited" plans, they're not unlimited at all. Rather, the plans simply charge for calls at per-minute rates.
Andrew Smith, Director of the FTC's Bureau of Consumer Protection, said, “These defendants ripped off families with loved ones in prison, selling them fake calling plans that were supposed to allow unlimited calls with those inmates. Especially with COVID-19 restrictions now in place, the phone is a lifeline for these families, who shouldn’t have to deal with this kind of exploitation.”
Assuming that the FTC's allegations are accurate here, on its face, there's nothing groundbreaking about this investigation. It should come as no surprise to marketers that you shouldn't market a calling plan as "unlimited" when the plan isn't, in fact, unlimited.
What struck me about this case, however, was who the FTC is looking out for. Here, the FTC took action to protect a vulnerable community that hasn't been a big focus of consumer protection action in the past -- prison inmates and their families and friends. In addition, the FTC specifically alleged in its complaint that, "Because a disproportionate number of incarcerated individuals are from communities of color or lower-income communities, many of the consumers harmed by Defendants' practices are likely from these communities." This suggests to me that the FTC is not only engaging in consumer protection here, but is consciously -- and laudably -- making decisions to use its limited resources to engage in enforcement actions to help people of color.
"These defendants ripped off families with loved ones in prison, selling them fake calling plans that were supposed to allow unlimited calls with those inmates" -- Andrew Smith, Director, FTC Bureau of Consumer Protection