Important News and Updates

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FTC amends the Telemarketing Sales Rule

On November 18, 2015 the FTC announced changes to the Telemarketing Sales Rule (“TSR”). The FTC’s changes are primarily directed towards protecting consumers from fraud, including by prohibiting telemarketers from using certain payment methods that legitimate telemarketing businesses don’t use, but con artists have been known to exploit. These payment methods include: remotely created checks, remotely created payment orders, cash-to-cash transfers, and cash reload mechanisms.

The FTC also modified the TSR to:

• Expand the advance-fee ban on recovery services to include losses both in prior telemarketing and non-telemarketing transactions;
  
• Require that a description of the goods or services purchased must be included in the tape recording of a consumer’s express verifiable authorization to be charged;
  
• Expressly state that a seller or telemarketer has to demonstrate that it has an existing business relationship with, or has received an express written agreement from, a consumer it calls if the consumer’s number is on the DNC Registry;
• Illustrate the types of burdens that deny or interfere with a consumer’s right to be placed on a seller’s or telemarketer’s entity-specific do-not-call list;
• Specify that if a seller or telemarketer does not get the information needed to place a consumer’s number on its entity-specific do-not-call list, the seller or telemarketer is disqualified from the safe harbor for isolated or accidental violations; and
• Emphasize that sellers are prohibited from sharing the cost of the fees to access the DNC Registry.
  

Most of the changes to the TSR will become effective 60 days after publication. The full text of the FTC’s final rule is available here.