Gryphon Insight

FTC Fines Telemarketers for Violations of Do Not Call Law

  

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By Melissa Fitzgerald

The Federal Trade Commission’s recent actions against telemarketers reaffirms that the Commission considers the National Do Not Call Registry as a viable, successful consumer protection program.  Marketers that thought enforcement was a thing of the past are in for a rude awakening—the FTC will not only fine call centers but those institutions for whom they are calling.  Marketers and sales teams, even those that only occasionally use the phone channel for soliciting, have the clear responsibility to ensure that not only their agents are in compliance but their third party vendors as well.  The FTC has been very clear that anyone on the “marketing chain” is liable for a Do Not Call violation, including non-captive, independent agents as well as corporations responsible for the actions of their outsourced call centers.

Last week the FTC settled with an Illinois-based telemarketing firm, Americall Group, Inc. for violations of the FTC’s Telemarketing Sales Rule (TSR), requiring the firm to pay a $500,000 civil penalty.  Americall is a third party call center with clients in a host of industries, including insurance, investment brokers, credit card issuers, retail, and medical facilities.  Failing to adhere to consumers’ requests to be added to the company-specific do not call list, the FTC investigated and discovered that Americall had trained its agents to ignore consumer requests to opt-out of future telephone calls.  Additionally Americall transmitted false Caller ID information that was intended to mislead call recipients.

Last month the FTC brought suit against a telemarketing service company, Sonkei Communications for allegedly providing substantial support to telemarketers who they knew or consciously avoided knowing were violating the TSR.  Among the allegations, the telemarketers were using the defendants’ services to violate the TSR by transmitting inaccurate caller names and dialing numbers on the National DNC Registry.  The FTC is pursuing $16,000 per violation that occurred after the violation increase on February 9, 2009, and $11,000 per violation that occurred prior to February 9, 2009.

Just this morning the FTC charged telemarketer Roy M. Cox, Jr. and several of his companies for allegedly violating the National DNC Registry, disguising caller ID, and for illegal robocalling consumers without written permission.  It is alleged that the defendents sought to hide their identity by using generic, inaccurate names such as “Card Services,” “Credit Services,” or “Private Office.”

With the enactment of more consumer protection laws at both the federal and state level combined with recent enforcement actions, consumers have become more aware of their rights to express their preferences about who markets to them and when.  Adhering to consumer preferences is not only a better way to do business, it is the law with serious PR and financial consequences for noncompliance.