Federal Commerce Fee Proposes Small Enterprise Protections Towards Telemarketing Methods and Traps

The Federal Commerce Fee right this moment proposed extending protections towards telemarketing tips and traps to small companies and strengthening safeguards towards different pernicious telemarking ways plaguing shoppers. The company is in search of feedback on updates to the Telemarketing Gross sales Rule that will shield small companies towards business-to-business telemarking schemes, handle tech-support scams that focus on seniors, and lengthen click-to-cancel necessities to telemarketing. 

“At this time we’re taking aggressive motion to guard small companies and shoppers from telemarketing tips and traps,” mentioned Samuel Levine, Director of the FTC’s Bureau of Shopper Safety. “We sit up for listening to from the general public about how we are able to additional strengthen this rule to carry telemarketing scammers accountable.”

Each the discover of proposed rulemaking and advance discover of proposed rulemaking introduced right this moment stem from the Fee’s regulatory assessment of the Telemarketing Gross sales Rule and handle public feedback the FTC has obtained as a part of that assessment.

The present regulatory assessment of the Telemarketing Gross sales Rule started with the publication of a 2014 Federal Register discover in search of feedback on normal points akin to whether or not to retain, remove, or modify the rule. It additionally sought touch upon particular points, akin to whether or not the rule ought to present further protections to shoppers from telemarketing calls involving use of beforehand acquired account info and detrimental possibility presents, in addition to recordkeeping necessities for sellers and telemarketers.

The Telemarketing Gross sales Rule

The FTC’s Telemarketing Gross sales Rule turned regulation in 1995 and applies to nearly all “telemarketing” actions, each in the US and worldwide gross sales calls to shoppers within the U.S. With a number of notable exceptions, the rule usually applies solely to outbound calls made by telemarketers to shoppers and protects shoppers in a spread of the way. For instance, the rule requires telemarketers to make sure disclosures and prohibits misrepresentations throughout gross sales calls.

The Telemarketing Gross sales Rule ensures that telemarketers get hold of a client’s authorization earlier than billing or accumulating fee, and prohibits telemarketers from requesting advance funds for providers, akin to credit score restore, “assured” loans, and debt settlement applications. The rule additionally prohibits bank card laundering by or on behalf of telemarketers and customarily prohibits them from calling telephone numbers on the Do Not Name Registry or plaguing shoppers with robocalls, amongst different issues.

Proposal to Defend Small Companies and Strengthen Enforceability

The discover of proposed rulemaking introduced right this moment proposes amending the recordkeeping necessities of the Telemarketing Gross sales Rule and prohibiting deception in business-to-business telemarketing calls. Particularly, the discover seeks public touch upon:

  • Enterprise-to-business schemes: Whether or not the FTC ought to amend the Telemarketing Gross sales Rule to ban misrepresentations in business-to-business calls, because the Fee’s expertise has proven that small companies proceed to be harmed by misleading telemarketing, and
  • Recordkeeping necessities: Whether or not the FTC ought to amend the rule’s recordkeeping provisions to require telemarketers to retain info in seven new classes, akin to conserving recordings of robocalls.

Addressing Different Telemarking Ways and Scams

The advance discover of proposed rulemaking introduced right this moment seeks info on a spread of points, a few of which had been recognized throughout the earlier remark interval. Particularly, the company seeks public touch upon:

  • Tech-support scams: Whether or not the Telemarketing Gross sales Rule ought to add further provisions to deal with the rise in tech-support scams. These are scams the place telemarketers trick shoppers into buying pointless laptop expertise providers to repair phantom issues. Typically, telemarketers who induce shoppers to name them by putting misleading web advertisements are at the moment exempt from Telemarketing Gross sales Rule necessities. The advance discover of proposed rulemaking seeks touch upon whether or not these calls needs to be coated by the rule.
  • Click on-to-cancel necessities: Whether or not the rule ought to require telemarketers to offer shoppers with a easy discover and cancelation, akin to click-to-cancel, after they join subscription plans; and
  • Robocalls and different telemarketing to small companies: Whether or not the Telemarketing Gross sales Rule broadly ought to cease treating telemarketing calls made to companies in another way from these made to shoppers. Typically, such calls at the moment are exempt from sure provisions of the rule.

The Fee vote approving publication of the discover of proposed rulemaking and advance discover of proposed rulemaking within the Federal Register was 4-0.

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