What do I Need to Know about the Telemarketing Sales Rule?
The Federal Trade Commission ("FTC") amended the Telemarketing Sales Rule ("TSR") in 2003, 2008, 2010 and 2015. Like the original TSR issued in 1995, the amended Rule gives effect to the Telemarketing and Consumer Fraud and Abuse Prevention Act ("TCFPA"). This legislation gives the FTC and state attorneys general law enforcement tools to combat telemarketing fraud, gives consumers added privacy protections and defenses against unscrupulous telemarketers, and helps consumers tell the difference between fraudulent and legitimate telemarketing. This guide describes the types of organizations and activities that are subject to the TSR and explains how to comply.
Certain key provisions:
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require disclosures of specific information
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prohibit misrepresentations
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limit when telemarketers may call consumers
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require transmission of Caller ID information
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prohibit abandoned outbound calls, subject to a safe harbor
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prohibit unauthorized billing
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apply to all upsells, even in unsolicited calls from a consumer
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set payment restrictions for the sale of certain goods and services
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require that specific business records be kept for two years
In addition:
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in August 2008, the Commission adopted additional amendments to the TSR that directly address the use of prerecorded messages in telemarketing calls.
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in August 2010, the Commission further amended the TSR to address deceptive and abusive practices associated with debt relief services.
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in December 2015, the Commission further amended the TSR to prohibit the use of remotely created payment orders and checks, cash-to-cash money transfers, and cash reload mechanisms in both outbound and inbound telemarketing. The amendments also expanded the TSR’s prohibition of recovery services to apply to losses in any prior transaction, not just prior telemarketing transactions, and clarified a number of Do Not Call and other TSR provisions.
All of these amendments are explained in this guide.
If your telemarketing campaigns involve any calls across state lines — whether you make outbound calls or receive calls in response to advertising — you may be subject to the TSR’s provisions.
Additionally, Advertisements promoting credit repair, promising loans for a fee in advance, or touting investment opportunities may trigger application of the FTC's Telemarketing Sales Rule if the ad allows consumers to order goods or services by telephone. In general, this Rule does not apply to general media advertisements. If you're advertising credit repair, advance fee loans, or investment opportunities, or offering to recover money paid in previous telemarketing transactions, however, the Rule likely applies to you. Among other things, the Rule requires that certain disclosures be made before a customer pays for the goods or services. The Rule also prohibits material misrepresentations.
For more information, see here: https://www.ftc.gov/tips-advice/business-center/guidance/complying-telemarketing-sales-rule
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