–By Lesley Fair
According to the millions of Americans who have listed their phone numbers on the National Do Not Call Registry, the program is a rousing success. But the untold story about the Do Not Call provisions of the Telemarketing Sales Rule may be the impressive level of business compliance. Marketers know that complying with the law makes good business sense because it allows them to focus their marketing budgets on people interested in what they’ve got to sell.
Although most companies have made compliance part of their corporate culture, the Federal Trade Commission (FTC) still receives complaints from consumers and vigorously prosecutes violators. Do Not Call remains a top enforcement priority because it defends the Registry’s success in protecting consumer privacy and ensures that violators don’t get an unfair advantage over competitors. The following lessons from FTC enforcement actions can help you determine whether your in-house procedures are up-to-date:
- You’re responsible for Do Not Call compliance, even if you hire a subcontractor to handle your telemarketing. Both the telemarketer who conducts the calling campaign and the seller whose product is promoted are legally responsible for any violations of Do Not Call. The FTC’s recent settlements with two timeshare companies and a telemarketer they hired to conduct calling campaigns on their behalf illustrate that point. The telemarketer’s violations of Do Not Call cost the timeshare companies $500,000 in civil penalties. The telemarketer also had to pay civil penalties, and its principals were banned from ever owning a telemarketing operation.
- The “established business relationship” exemption expires after 18 months. The Do Not Call provisions don’t cover telemarketing calls to consumers with whom you have an “established business relationship,” but that relationship lasts for a limited time. Unless consumers have transacted business with you within the past 18 months or have submitted an inquiry or application about your products or services within the past three months, they may be off-limits. Before calling a former customer based on an established business relationship, make sure the relationship is current.
- Pay your Registry fees. Sellers are required to pay fees to support the Registry. Avoid telemarketing outside the area codes you’ve paid for. Check the Subscription Account Number and pay the appropriate access fees before making calls in that area code. Braglia failed to do so on behalf of the two timeshare companies and the FTC found all of them liable. In addition, don’t register as an exempt organization unless that’s the case. Calls by bona fide nonprofit groups are exempt from compliance with the Registry and nonprofits don’t have to pay fees.
- Remember to honor consumers’ “entity-specific” Do Not Call requests. The Telemarketing Sales Rule requires that telemarketers respect a consumer’s request not to be called again. This requirement predates the Do Not Call Registry by several years. Therefore, even if you have an existing business relationship with a consumer, once that consumer asks not to be called again, you have to honor that request. Rather than specify a rigid time frame within which to comply, the FTC expects you to act in a “reasonably expeditious manner.”
Lesley Fair is an attorney in the FTC’s Bureau of Consumer Protection.
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