Company Accused Of Selling Info To Telemarketers Settles With Feds

IRVINE, CA — An Irvine-based company has reached a settlement with federal authorities over allegations that it collected and sold people’s information to be used for robocalls and telemarketing, officials said.

Response Tree LLC and its president and managing member, Derek Thomas Doherty, agreed to a court order resolving alleged violations of the Telemarketing Sales Rule in connection with illegal telemarketing, according to the U.S. Department of Justice.

Doherty and the company obtained people’s information and their purported consent to certain phone calls, including robocalls and calls to numbers on the Do Not Call Registry, authorities said. They did this by running over 50 websites that deceptively induced users to disclose information by, for example, claiming to provide mortgage refinancing, according to the department. They then sold the data to purveyors of goods and services, authorities said.

“Response Tree fueled millions of illegal telemarketing calls by tricking consumers into turning over their personal information and selling that information to telemarketers,” said Samuel Levine, director of the Federal Trade Commission's Bureau of Consumer Protection, in a news release. “The FTC will continue to target every corner of the illegal telemarketing ecosystem to protect consumers and hold wrongdoers accountable.”

The court order, entered Friday, imposes a $7 million civil penalty judgment, suspended due to the defendants’ inability to pay, according to the department. It also prohibits Response Tree and Doherty from collecting and selling names, addresses, contact information, or details about people’s gender and age in connection with lead generation, authorities said.