TCPA regulations

Telemarketing Rules You Should Know About

If you are in sales, it is important to understand the telemarketing rules governing your industry to make sure that you don’t accidentally wind up violating one and slapped with a fine.

There are several laws that govern telemarketing including The Federal Trade Commission’s (FTC) Telemarketing Sales Rule (TSR), the Federal Communications Commissions’ (FCC) Do Not Call Registry, and the Telephone Consumer Protection Act.  Many of the guidelines overlap and in the past year some of the rules have tightened, for example, with calls made to cell phones.

Telemarketing Rules for Cell Phones

Previously, if you had an existing relationship with a customer, you could call their cell phone.  This was considered implied consent.  Basically, if they bought something from you they obviously would want to hear from you again, right?  Apparently not.  Enough consumers complained that the legislation was changed to require companies to secure “express written consent” prior calling someone on their cell phone.  The written consent can be in paper or electronic form and can be revoked by the consumer at any time.

Charging a Customer Over the Phone

If you are selling a product over the phone and collecting payment for it, you must receive “express informed consent” from the consumer prior to charging their card. This means that you must disclose the fact that the card is about to be charged and the exact amount of the charge itself. If you have their financial information prior to placing the call, you still must confirm the account they want to use, billing address and the dollar amount that will be charged now or in the future.

Telemarketing Rules for Caller ID

When placing a call, you need to make sure that your phone number, and when possible your name, shows up on the caller ID.  Do a test call to make sure everything shows up correctly and avoid a potential violation.

Live Transfer

In order to reduce abandoned calls, if you are using an auto dialer it must transfer the call to you or another live agent within two seconds of someone answering the phone.  This is to reduce the number of dead air calls and hang-ups.

Robocalls

Before a business can call with a pre-recorded message, it must have consent from the consumer to make that specific type of call.  For example, if you want to reach people with pre-recorded message, they must specifically approve that call.  This is the strictest form of calling regulation apart from making calls to cell phones.  The exception is if you are making an informative call to a customer, for example, an airline calling to say that the flight was delayed.

No list of cold calling rules would be complete without a reminder to scrub your lead list against the Do Not Call Registry.  It is also wise to have a policies and procedures manual, even if you are a solopreneur, that states the steps you are taking to stay in compliance with cold calling regulation.  Make sure that the entire staff reads and signs this document on an annual basis.  If you accidentally call someone on the DNC Registry or make another violation, this will demonstrate that it was accidental, and you have been trying to stay in compliance.

State Telemarketing Laws

If you are a telemarketer or making sales calls, it is important to follow both federal and state telemarketing laws.

Many companies make the mistake of assuming that they only need to follow the federal laws and avoid violating the Do Not Call Registry.  The reality is that each state has the ability to make their own laws and to enforce them.  If you are calling in your home state, you can easily place a call to your local Attorney General to identify any specific laws that you need to be following.  If you are calling nationwide it becomes more complicated, and you need to make sure that your policies and procedures are established to avoid any violations.

Here are some state telemarketing laws that you need to know about:

  • Missouri – The state of Missouri has a No Call Law.  This law prohibits telemarketers from contacting any residential numbers that are on the states no call registry.  Even if the individual has not listed their phone number on the federal registry, they could be listed on the statewide one.  Missouri defines a telemarketer as anyone who is connected to a company that does telemarketing through incoming or outgoing phone calls. This includes automatic calls made from a computer, owners, operators, directors, and managers of said companies. In order to get a copy of the registry businesses have to apply for it and pay a $50 fee.  The registry is updated every quarter and both in state and out of state companies must comply with the telemarketing laws.
  • New York – New York has passed several state wide telemarketing laws that make it more difficult for companies making sales calls.  They require that any telemarketing company using pre-recorded messages must have prior written consent before reaching New Yorkers at home.  They also have a law requiring telemarketers raising money for charity to disclose how much of the money goes to the charity itself.  Both in state and out of state companies must comply with their telemarketing laws and keep records of all activities for two years.
  • Arizona – Telemarketing companies making sales calls in Arizona must first register with their Secretary of State.  If any company has a change in their filing, it must be reported within ten days of the change.  This applies to all companies making telemarketing calls in Arizona.  The state does not allow telemarketing companies to block their Caller ID or use prerecorded messages on mobile devices.

These are only some of the states with specific telemarketing laws on the books.  It is important to check the state laws prior to making calls in order to avoid any potential violations.  You should also create a policies and procedures manual that includes how to follow both federal and state laws.  This will be a good reference guide and show authorities that you are trying to comply if a mistake is accidentally made.

You can also purchase a specific call list from www.SalesLeads.tv to ensure that your calling efforts are reaching the right people and as effective as possible.

Telemarketing Rules for Debt Relief Companies

The Bureau of Consumer Protection Business Center has released a guide on telemarketing rules for debt relief companies.

There are basic provisions about cold calling that apply to all industries  For example, you must scrub your lead list against the Do Not Call Registry and must have a policy in place for how to follow these guidelines.  As of October 2013 companies are also not allowed to send text messages without prior written consent.

While many of these rules are the same across all industries that are specific, additional provisions that apply to debt relief companies.  These regulations have been created to protect consumers against what the government feels are deceptive or misleading practices.

The major difference with these new telemarketing rules is that it ALSO applies to calls you receive – not just outbound calls you place.

Here is what you need to know:

  • You must make specific disclosures before selling people your services. There are specific things that you have to disclose.  This includes how long it will take for the consumer to see results, the basics of what you will be doing for them, what they have to pay, how working with you will negatively impact their credit, and information on dedicated accounts. Basically, the consumer needs to be informed about how your business works, the steps along the way, and the good and bad results that they will experience.
  • You must be truthful about your services. You cannot make false or unsubstantiated claims about your services.  This is common sense but necessary to specifically mention it.
  • You can’t charge or collect upfront fees.  Until you have settled their debts or somehow negotiated a different payment scenario, you cannot collect fees from the customer.  If you negotiate each debt individually, you can collect a fee each time.  The caveat is that you cannot front-load any payments. If you are having customers make a payment of fees and to the creditor that goes into a specified account their are set rules for how that has to be handled.

The best way to protect yourself from violating telemarketing rules is to stay up to date on changes and create an internal policy that is regularly shared with your employees.  Make sure that employees are trained on the fact that telemarketing rules now also apply to in-bound calls they receive.  Keep a log where each employee signs that they were trained, or received a refresher course, on a specific day.  This is a good best practice for any company that is engaged in telemarketing.  The penalties are less severe for companies that can prove they are trying to abide by the regulation but may have had a rogue employee.

If you are providing outsourced telemarketing services make sure that your contract specifies who is liable for any violations, who would pay the fees, and if either party is required to provide legal support in the event that charges are brought.  It is important for each party to abide by the telemarketing rules and specific contracts can protect you in the event of an accidental violation.

Definitions Under the TCPA

Definitions Under the Telephone Consumer Protection Act (TCPA)

 

If you are in sales, marketing, or a telemarketer by trade it is important to understand the rules found within the Telephone Consumer Protection Act (TCPA) in order to avoid accidentally violating them. TCPA Violations can lead to fines or even losing the ability to telemarket.

Here is what you need to know:

Telemarketing Defined

The regulations consider a telemarketing call to be one made by advertisers to offer or sell products or services.  If you are simply providing information it is not telemarketing.  For example, an airline telling you a flight has been delayed is not considered telemarketing.

An Autodialer is a Machine or Software That Helps You Make Calls

When you have to pick up the phone and personally dial every call, it can take a lot of time and slow you down.  Minutes are wasted dialing, waiting for someone to answer, and getting busy signals.  An autodialer can automatically call people for you and give them a recorded message or connect you once they have answered.  While this is a more efficient calling method it is also more highly regulated.   If your autodialer delivers a pre-recorded message it is considered a robocall, the most highly regulated form of telemarketing.   Previously, if a consumer had an existing business relationship with you a robocall would be acceptable.  Now, there must be prior written consent in order to avoid a violation.

Text Messages Are Regulated by the TCPA

Recent regulation has made it more difficult for telemarketers to contact people on their cell phone.  Now, if you want to send a text message you need to have prior written consent from the consumer to do so.  This cannot be considered implied consent but must be clearly spelled out in writing.  You can have consumers sign their consent on a traditional piece of paper or electronically give their consent.  This is a big change because in the past an existing business relationship fulfilled this requirement. The only exception is text messages for the purpose of informing someone, rather than selling them something.

Do Not Call Registry 

It is important to always scrub your call list against the national Do Not Call Registry.  Remove anyone that is on the registry from your list.  If you contact someone that was not registered, but wants to be removed from your list, you must do so immediately.  It is wise to have a written policy in place for how you remove people once a request has been made.

Violating TCPA Regulations

If you violate the TCPA guidelines you could be fined anywhere from $500 to $1,500 per call, message, or text.  This is not per day but per call.  If you make 100 calls that violate these regulations that could be a $150,000 fine.  Many companies have gone out of business due to these penalties.

Stay up to date on regulation and create policies and procedures to protect yourself and your company.  Taking the time to ensure that you are in compliance could save you money and headaches down the road.

New Telemarketing Legislation Proposed in NY

Assemblyman Matthew Titone (D-North Shore) has introduced new telemarketing legislation into the New York assembly that would require telemarketers raising money for charities to disclose how much of their donation will actually go to the organization.

If passed, telemarketers would need to specify how much money they were taking in profit and how much would end up in the charity itself.

“Generous New Yorkers have a right to know where their donations are going and how that money will be spent,” Titone said.

In 2012, a report was issued called “Pennies for Charities”.  This report showed that out of every dollar raised by telemarketing companies for charity, only 0.38 went to the charity with the remainder going to the telemarketing company. In that year alone over $249 million in donations were raised in New York and Titone believes that New Yorkers should be made aware of where their funds are going.

If the legislation passes telemarketers would have to send a follow up letter to everyone that donated explaining the breakdown of the funds.

This would give them the information they need to determine if they want to donate in the future, and is aimed at specifically helping to educate the elderly and disabled, who he claims are often victims of telemarketers.

From a telemarketers perspective, if the legislation goes forward it will require an additional compliance step that cannot be ignored.  It is likely that someone within the organization would need to be hired or assigned to the specific task of sending follow up letters to contributors and keeping record of this correspondence.

Some things will need to be clarified.  For example, how quickly after the donation was recieved does the letter need to be sent?  Do telemarkters need to inform contributors that a letter will be sent and how long will the records need to be kept?  Companies raising money in New York, and throughout the country, need to stand by for the next couple of weeks until individual states are done with their legislative sessions.

Many companies fall into the trap of only watching telemarketing legislation at the federal level, while ignoring individual state legislation.

Each state has the ability to create and enforce laws that regulate the industry so it is important to conduct research prior to calling in that state.  This recent telemarketing legislation out of New York is only one example.

For state specific information you can visit the state attorney generals office website or put in a call to them in order to be directed to where you can access their regulations.  If you are hired to run a large state wide campaign make sure to understand the rules before you start dialing.  It could save you and your firm thousands in fines.  Most state sessions end by mid April so we should know the results of New York’s telemarketing legislation then.

Telemarketing Rules When Calling Businesses

When starting a cold calling campaign, it’s important to understand what the telemarketing rules are, TCPA regulations, and guidelines so that you can stay in compliance and avoid any potential fines.

Most regulations revolve around calling consumers but many sales jobs focus on business to business calling.  Whether selling new printers, memberships, or logistic services, calling prospect may be the fastest way to increase your sales numbers.

According to the FTC most businesses or salespeople can call another business and stay exempt from the Rule.  This is great news for B2B sales people.  All you need is a quality list of sales leads to start dialing.  Just make sure that you are calling them yourself, not using an autodialer.  If you are doing robocalls you will be subject to additional rules.

There is a further exemption to be aware of.  

According to the FTC, “Although sellers and telemarketers involved in telemarketing sales to businesses of nondurable office or cleaning supplies must comply with the Rule’s requirements and prohibitions, the Rule specifically exempts them from the recordkeeping requirements and from the National Do Not Call Registry provisions. These sellers and telemarketers do not have to create or keep any particular records, or purge numbers on the National Do Not Call Registry from their call lists to comply with the Rule.”  In other words sellers of nondurable products do need to comply with the DNC when calling businesses but don’t have to keep as detailed of records.

What you need to be aware of when calling off of a sales leads list is that business cell phones are now covered under the new TCPA regulations.  

These rules require you to have prior written consent prior to contacting someone’s cell phone and this includes text message marketing.  It is not enough to have implied consent.  It must be in writing.  If you are making calls to businesses you need to make sure that you are calling land lines so that you don’t accidentally violate any of the new TCPA rules.  The additional challenge with cellphones is that if someone uses their phone for business and personal calls, the number could fall under the Do Not Call guidelines for consumers which could result in you completing an accidental violation.

Your first line of defense is to get a quality list of sales leads that has been scrubbed against the DNC registry.

This should remove any personal cell phone or home phone numbers that have been added to the federal Do not Call list.  Some business owners use their personal phone numbers so this will help you to identify and eliminate which ones not to call.  You also want a quality list because it will enable you to specifically target the industry you are interested in reaching out to.  By using NAICS codes you can have a list generated that is specific to your ideal customer base.

The most important thing to remember when calling other businesses is to pick up the phone and dial them yourself.  Robocalls have a significant amount of legislation associated with them and you could easily find yourself in violation.  Make the calls personally from a qualified lead list and watch as your sales numbers increase.