Feds Say Great Neck Firms Facilitated Millions Of Robocalls

A diagram illustrating how U.S. companies facilitate robocall schemes from India. (Courtesy of the Department of Justice)

A Great Neck business owner has been indicted by the federal government on charges that his telecommunications firms helped facilitate robocall scams that yielded millions of dollars in payments from people across the country since 2017.

The complaint submitted for the lawsuit in the United States District Court for the Eastern District of New York (EDNY) claims that a number of companies run by Great Neck businessman Jon Kaen (Global Voicecom, Inc; Global Telecommunication Services Inc. and KAT Telecom, Inc and IP Dish, which investigators claim Kaen operates out of his Great Neck home) knowingly provided foreign call centers, mostly in India, with voice-over-internet protocol (VoIP) services that allowed those companies to contact millions of Americans every day using false phone numbers that made it appear as if the calls were coming from local lines or government services. Those companies then attempted to trick people across the country, in many cases successfully, into paying them to resolve the alleged issues they scared victims into believing they faced.

“Since at least 2017, the defendants [Kaen and his businesses] have knowingly provided U.S.-bound calling services to foreign fraudsters operating robocall scams, acting as a gateway carrier and passing robocalls into the U.S. telephone system by the millions,” the complaint reads. “The defendants are paid for each call they pass into the U.S. telephone system. In addition, the defendants have provided return-calling services to the fraudsters operating the robocall scams, for which defendants are also paid, enabling the fraudsters to establish contact with unwitting individuals after the individuals are deceived by a robocall.”

The defendants also received a direct payment from one of the fraud victims on at least one occasion, according to court documents, and ignored repeated signs and warnings from providers like AT&T that their services may have been enabling scams.

“High volumes of short-duration and unanswered calls are indicative of robocalls that are unwanted by the recipient, often because they are fraudulent,” the complaint reads. “The government’s investigation has revealed a sample of more than 7.7 million calls that defendant Global Voicecom routed through a single downstream VoIP carrier over 19 days in May and June 2019. Of those calls, more than 6.6 million were one second or less in duration, indicating exceedingly high levels of junk and fraudulent robocalls.”

Among the phone scams Kaen’s companies helped facilitate, allegedly with their cooperation, were calls claiming the recipient’s social security number was being shut down due to alleged criminal activity, calls impersonating the Department of Homeland Security and calls claiming to be from emergency services. The VoIP the defendant’s companies provided allowed scammers to make it appear as if the numbers they called from were legitimately connected to the bodies they claimed to represent, including thousands of calls that showed up as “911” on victims’ phones.

The federal government is seeking an injunction against Kaen and his companies to prevent them from continuing to act as middlemen for foreign robocall scams. Neither Kaen nor representatives from any of the companies prosecutors claim he is involved with could be reached for comment. Kaen’s attorney was unable to comment on the case prior to publication.

The case against Kaen is one of a pair of lawsuits U.S. attorneys are pursuing against American companies they believe are providing aid to foreign robocall scams. The other suit, against Arizona residents Nicholas and Natasha Palumbo and their companies Ecommerce National and SIP Retail, similarly alleges the defendants helped scammers defraud Americans out of millions of dollars.

The DOJ said the suits represent the culmination of their efforts to fight back against what it calls a “deluge of robocalls” that have plagued the nation in recent years. Fortune reported that Americans received 26.8 billion robocalls in 2018, and the average person received 10 spam calls every month.

“Robocalls are an annoyance to many Americans, and those that are fraudulent and predatory are a serious problem, often causing devastating financial harm to the elderly and vulnerable members of our society,” DOJ Civil Division Assistant Attorney General Jody Hunt said in a press release. “The Department of Justice will pursue to the fullest extent of the law individuals in the United States who knowingly facilitate imposter fraud calls, using both criminal and civil tools where appropriate.”

EDNY attorney Richard Donoghue said the suits represent a landmark in the prosecution of robocalls, the first time the federal government has taken action against the U.S. companies that enable foreign-based call scams, which have disproportionately affected the ederly across the country.

“We are using all available tools and resources to stop foreign call center scammers—and for the first time their U.S.-based enablers—from conning elderly and vulnerable victims in New York and throughout the United States,” Donoghue said in a press release. “Protecting individuals from schemes that result in catastrophic losses to the victims is a priority of this Office and the Department of Justice.”

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