By D. John Hendrickson

In late November 2015, the Federal Trade Commission finalized amendments to the Telephone Sales Rule that regulates the telemarketing industry. Marketers need to understand that the amendments contain changes that may affect telemarketing scripts. In general, the TSR applies to marketers making consumer-oriented, outbound sales solicitations and certain in-bound calls when the telemarketer engages in the upsell of additional or alternate items.

From this point forward, telemarketers must:

  • Include an accurate description of the goods or services that is clearly and conspicuously stated at the time express authorization is sought. In short, when obtaining (and recording) the customer’s permission to place the order and authorize payment, the telemarketer must clearly inform the customer as to the goods or services he/she is purchasing;
  • Understand that the exemption for calls to businesses is for sales for the business itself, and not calls for inducing sales from individuals employed by the business.

The amendments also address provisions pertaining to the Do Not Call requirements of the TSR:

  • The burden is on the telemarketer to demonstrate an Existing Business Relationship exists;
  • The FTC identifies impermissible burdens that the telemarketer may not utilize regarding Do Not Call provisions;
  • Failure to obtain required information to add the consumer to the seller’s internal Do Not Call list exempts the seller from safe harbor for isolated or inadvertent violations; and
  • The telemarketer can’t share the cost of the DNC Registry fees.

Additional changes deal primarily with non-traditional payment methods other than credit card or debit card accounts. These changes apply to “certain kinds of checks and payment orders that have been remotely created by the telemarketer or seller.”  The amendments will also bar telemarketers from receiving payments through traditional “cash-to-cash” money transfers – provided by companies like MoneyGram, Western Union, and RIA.  In addition, the amendments prohibit cash reload” mechanisms – such as MoneyPak, Vanilla Reload, or Reloadit packs used to add funds to existing prepaid cards.

Legal disclaimer:  This article is not intended to constitute legal advice or to create an attorney-client relationship.  We trust you knew this anyway.