February 2008
DNC.com Monthly Compliance Update
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Table of Contents
Featured Article: Coming Soon - The National DNC "Perma-List"
Free Webinar: Thursday, February 14 from 10:00 - 11:00 AM (PST)
State Holiday Alerts: State DNC Restrictions for February and March Holidays
Missouri Bill Would Prohibit Automated Calls to Numbers Registered on State DNC
New Jersey Seeks Revisions to State DNC Rules
FTC Sues Payment Processor as an Accomplice to Fraudulent Telemarketers
Featured Article
Coming Soon: The National DNC "Perma-List"
by Joseph Sanscrainte
Joseph Sanscrainte is an attorney with Bryan Cave, LLP, specializing in telemarketing law.
Visit us at DNC.com for information on contacting Joseph Sanscrainte.
The history of the Federal Do Not Call registry is, at least to those with a vested interest, a long and fascinating one. From its launch in 2003 to a chorus of dire warnings from the teleservices industry, to the (ultimately unsuccessful) attempt to have it declared unconstitutional, to the seemingly never-ending increases in the fees for access to it, the national registry is good for several headlines every year.
The most recent twist, one that has raised eyebrows across the teleservices industry, is the attempt by the United States Congress to create what has been dubbed the "Perma-List." In essence, Congress wants to set up the national DNC registry so that a consumer would only need to register his/her phone number once in order to avoid telemarketing calls (rather than every five years, as is currently the case.) Any number so registered would remain on the list permanently, barring the disconnection or reassignment of the number. All numbers that have already been added to the national registry to date (in excess of 140 million, as reported by the Federal Trade Commission) would remain on the national registry.
Despite industry issues, two "sister" bills have already been passed (in December of 2007) - House Resolution 3541 (introduced by Rep. Michael Doyle,
(D ? PA)) and Senate Bill 2096 (introduced by Senator Byron Dorgan (D-ND). A review of the history of events leading to this legislation highlights some of the important complexities on this issue.
The Federal Trade Commission's (FTC) telemarketing regulations (the Telemarketing Sales Rule or "TSR") went into effect as of December 31, 1995. In November of 1999, the FTC began a mandatory review of its TSR rules, which culminated in the release, in December of 2002, of an amended TSR. As expected by the telemarketing industry, the amended TSR created a "national" DNC list (to be managed by the FTC). (The FCC followed suit shortly thereafter by announcing it would adopt the FTC's national registry for its DNC purposes.)
In what has become an important section in the FTC's "Statement of Basis and Purpose" announcing the new list, the FTC addressed the question of the length of time numbers should remain on it as follows:
The Commission is . . . aware that the length of time registrations remain valid directly affects the overall accuracy of the national registry. . . . The Commission believes that a five-year registration period coupled with the periodic purging of disconnected telephone numbers from the registry adequately balances, on the one hand, the need to maintain a high level of accuracy in the national registry and, on the other hand, the onus on consumers to periodically re-register their telephone numbers.
The FTC, in fact, reviewed all existing state DNC list renewal periods in reaching the above conclusion, and expressly rejected the possibility of following the course set by some states in not having a fixed renewal period.
Many in the industry now ask why Congress finds it necessary to legislate on an issue that has already been extensively addressed, and resolved, by the FTC?
The renewal issue took center stage only recently, with "d-day" for the beginning of the removal of numbers from the national registry looming as of June 27, 2008 (the registry officially opened for business on June 27, 2003.) In response to the legislation introduced by Congress, the FTC has opted to stop any such removal, stating that "the Commission now commits that it will not drop any telephone numbers from the Registry based on the five-year expiration period pending final Congressional or agency action on whether to make registration permanent." In effect, the teleservices industry has been presented with a regulatory "fait accompli" with little to no opportunity for follow-up action.
The one certainty is that list accuracy is a genuine concern for all parties. The FTC's statement regarding its purging program, however, perhaps raises more questions that it answers. The FTC states that the contractor running the national DNC program subcontracts the list purging to a list broker subcontractor. The FTC continues that "[t]o the best of the list broker's knowledge, it receives data from every LEC and the accuracy of the data it receives is consistent with the accuracy of the LEC's billing records." This language alone is enough to give pause to the teleservices industry.
In addition, many in the industry question whether "unlisted" phone numbers can be legally included in any nationwide compilation of information prepared by a private list broker ? if not, this in and of itself poses issues that dramatically impact the overall accuracy of the national registry.
The teleservices request for parity between the strict compliance requirements imposed on the industry and the accuracy levels to be achieved by the FTC in maintaining a permanent DNC list is not unreasonable. In addition, on-going and full transparency of the methods used by the FTC to remove disconnected and reassigned numbers from the registry would certainly be welcomed by the industry.
Commercial Registration Review: Joe Sanscrainte and Bryan Cave are pleased to announce a new service to help companies navigate state-by-state commercial registration requirements. 30+ states have such requirements, and many of them apply to both outbound AND inbound calls. Find out if you're registered appropriately, or better yet, confirm that you're exempt!
Free Webinar
Encore Presentation of Compliance Webinar on Thursday, February 14
In case you missed the most recent Compliance Webinar on the Latest on Enforcement and Legislation join us for a repeat performance.
Register today at: https://www1.gotomeeting.com/register/582861383
State Holiday Alerts
Alabama, Louisiana, Rhode Island and Utah all restrict outbound calling to consumers during their respective state recognized holidays. The following holidays have been verified for the months of February and March:
Outbound calling is prohibited in Alabama, Rhode Island and Utah on Monday, February 18th, 2008 in observance of President's Day.
Outbound calling is prohibited in Louisiana, March 21st, 2008 in observance of Good Friday.
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Meet us in Denver, Colorado on March 13th for the ATA Mountain Chapter's Compliance Seminar. Call us at 1-866-362-5478 or visit DNC.com for more information.
Regulation Alerts
MISSOURI BILL WOULD PROHIBIT AUTOMATED CALLS TO NUMBERS REGISTERED ON STATE DNC
The Missouri Senate has pre-filed a a state senate bill (SB 840) that would prohibit calls to automated numbers registered on the Missouri State Do Not Call list. The bill would allow exemptions to contacts with whom the company has an Established Business Relationship (EBR) within the last 180 days.
NEW JERSEY SEEKS REVISIONS TO STATE DNC RULES
Proposed revisions by the New Jersey Department of Law and Public Safety to the New Jersey Do Not Call rules would alter current registration fees. The new rule would change the fee base from the number of telephone numbers a company has to the "simultaneous outgoing call capacity". This would compensate for companies who could potentially avoid fees by claiming they do not employ individual numbers when utilizing alternative direct-connect technology.
FTC SUES PAYMENT PROCESSOR AS AN ACCOMPLICE TO FRAUDULENT TELEMARKETERS
Based on the guidelines of its standard of "accomplice liability" the Federal Trade Commission has decided to sue a payment processor for its connection to fraudulent telemarketers who violated the national Do Not Call list in addition to engaging in unauthorized debiting practices and general acts of fraud. The FTC alleges the company had received information and documentation indicating its clients were engaged in such violations and was therefore liable for those violations as an accomplice.
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All information contained in this newsletter has been researched to ensure accuracy. However, Contact Center Compliance will not be held legally responsible for the accuracy of this information and is not a substitution for legal counsel.