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FTC Stiffens Requirements For Telemarketers

New rules give consumers more power to opt out

December 3, 2008

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The Do Not Call list has been effective in blocking most annoying telemarketing calls, but charitable groups are exempted. Now, new rules give consumers an option of opting out of future calls, even when they're recorded and placed by a machine.

The new federal rule requires that the opt-out must work both for consumers who answer these calls in person and for those whose answering machines or voicemail services receive the calls.

Under Do Not Call amendments adopted by the Federal Trade Commission (FTC)in August, any permitted recorded message must provide the called consumer with an interactive means to opt out of receiving future calls from the seller or fundraiser using the message. Moreover, the consumer must be able to opt out at any time while the message is playing by pressing a particular number or speaking a particular word.

Once the consumer has opted out, his or her phone number must be automatically added to the in-house Do Not Call list of the calling seller or fundraiser. Then the call immediately must be disconnected so that the consumer's line is cleared.

If the recorded telemarketing message is left on an answering machine or voicemail service, it must include a toll-free opt-out number that, when called, also connects to an automated voice or key-press opt-out mechanism. This will let consumers opt out at any hour of the day or night when they retrieve the message, without having to wait until the next business day to call.

All recorded telemarketing calls subject to the Commission's Telemarketing Sales Rule (TSR) must comply with the new requirements, including calls to solicit sales of goods or services and calls placed by telemarketers to solicit charitable donations.

Some calls delivering recorded messages, such as political calls, bona fide market survey calls, and calls made in-house by banks or telephone companies, are not covered by the new requirement, however, because the Commission lacks the legal authority to regulate them. Recorded healthcare messages covered by the Health Insurance Portability and Accountability Act of 1996 also are exempt from the new requirement.

The automated opt-out requirement is the first of two measures provided by the recent TSR amendment to protect consumers' privacy at home. The second measure prohibits telemarketing calls that deliver recorded messages to anyone who has not agreed in advance to receive such calls.

But until September 1, 2009, sellers may continue to use recorded messages in calling consumers with whom they have an established business relationship. After that date, sellers may use these messages only in calls to consumers who have expressly agreed in advance to receive them.

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