March 2008

DNC.com Monthly Compliance Update

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Table of Contents

 

Featured Article

ATA SRO Standards: Compliance Nooks and Crannies

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.

As most in the teleservices industry are aware, the ATA has embarked on an ambitious (and long overdue) plan to create a Self-Regulatory Organization (or SRO) for the industry. An important first step in reaching this goal was completed last year with the launch of the ATA's SRO Standards (available at www.bryancave.com/ata-sro).

The Standards are 68 pages long, and accordingly contain a wealth of guidance and best practices for an industry used to dealing with seemingly endless contradictions between state and federal laws. A "one size fits all" set of Standards, although attractive in concept, is nonetheless hard to achieve, precisely due to the sheer number of differences that exist between the applicable state and federal laws.

This article takes a brief look at these differences, or the "nooks and crannies" that compliance practitioners need to keep in mind as they navigate the Standards. The first area of concern is state commercial registration ? the first set of hoops that states require sellers and telemarketers to jump through before starting a calling campaign. Although required by the majority of states, commercial registration also comes with hundreds of exemptions, and thus defies standardization.

Before even picking up a phone to make an outbound call (or, very often, to accept an inbound call) sellers and service bureaus need to determine: first, whether the law applies to them (it normally does), and second, whether any of the hundreds of exemptions available apply to them. Once these determinations are made and registration completed as appropriate, then, and ONLY then, can the telephone solicitation campaign begin.

The next main area of concern is, of course, Do Not Call. Despite the FTC's early insistence that all states would join the national registry bandwagon, there are still some rogue states out there that operate independent DNC programs. The existence of independent state lists creates additional decisions for telemarketers, decisions that once again defy standardization.

For decision-making purposes, there are essentially three types of states: 1) those that do not have DNC laws on the books; 2) those that do have such laws but make use of the national registry as the default "state" list; and, 3) those that have laws and stubbornly refuse to give up their independent lists.

The first category is easy ? just use the national registry and the FTC and FCC exemptions. The second category requires some nuance ? use the federal list and federal exemptions, avoid any "less restrictive" state exemptions (preempted), but comply with any more restrictive rules (i.e., the absence of exemptions at the state level.) An example of this would be a charitable entity making calls on its own behalf where sales of goods or services are offered ? exempt at the federal level, but not exempt under some state rules!

The third category requires companies to comply with two lists and two sets of exemptions - it's possible, for example, for a company to have to follow the national registry, but NOT the state DNC list due to differing exemptions. In Indiana, if you are an employee of a newspaper calling to solicit subscriptions, you do NOT have to abide by the Indiana DNC rules, but you still have to follow the national registry rules.

Got a headache yet? Well, there are a bunch of other areas where a "nooks and crannies" analysis (taking a look at whether a given state has rules more restrictive than federal rules) is required. These include: established business relationships for DNC exemption purposes; inquiry rules for DNC exemptions purposes; rules governing identification and purchase disclosures (including permission to continue and no rebuttal); requirements regarding the use of demand drafts; calling time restrictions; the use of pre-recorded calls; and, call monitoring regulations.

And last, but certainly not least, any company making sales by telephone has to comply with an additional set of regulations that the FTC and FCC do not even cover ? contract cancellation requirements. Many states have very specific rules governing whether a written signed contract is necessary for a telephone sale; the length of time within which consumers have to cancel a sale completed via telephone; and the exact language that must appear in a writing sent to the consumer.

Long story short (I know, too late!), the Standards are absolutely essential and provide a incredible wealth of information and guidance for any company engaged in teleservices. The idea of teleservices regulation "standardization" itself, however, can only go so far when you have two federal agencies and 50 states (and don't forget the district of Columbia, either) that can enact, and in fact do enact, differing rules.

Compliance Tools

QUESTIONS ABOUT DO NOT CALL REGULATIONS?

DNC.com is now offering a complimentary audio CD filled with 13 tracks of commentary from a panel of leading industry experts. Get detailed information on scrub lists, safe harbor provisions, exemptions, enforcement actions and more! To get your free CD visit DNC.com.

 

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 March and April:

Outbound calling is prohibited in Louisiana, March 21, 2008 in observance of Good Friday.

Outbound calling is prohibited in Alabama, April 28, 2008 in observance of Confederate Memorial Day.

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Visit us at DNC.com and take a free test drive of our award winning compliance solution, DNCScrub, or visit us at any of our compliance seminars held across the nation, through-out the year, for your chance at winning a free iPhone!

Meet us in Denver, Colorado on March 13, or in Atlanta, Georgia on March 27 at the ATA's March compliance seminars. Call us at 1-866-362-5478 or visit DNC.com for more information.

Regulation Alerts

 

MISSOURI CONSIDERS BILL TO RESTRICT POLITICAL CALLS

The Missouri House of Representatives has begun consideration of a bill, HB 1606, which would include political calls under the restrictions of the state's Do Not Call list. Additionally, a proposed Missouri State Senate bill, SB 840, would additionally bar prerecorded political calls to persons on the State DNC list.

 

TELEMARKETER FINED FOR VIOLATING NORTH DAKOTA DO NOT CALL LAWS

After repeatedly violating North Dakota's state Do Not Call laws telemarketer, Community Welfare Services Inc, has agreed to pay $25,000 in fees in place of civil penalties. After paying $1000 on two earlier occasions for violating Do Not Call laws in North Dakota the telemarketer faced a third investigation following a new complaint against the company in September 2007 with the State AG's office. This time a large number of violations could be connected to Community Welfare Services call campaign for the Committee for Missing Children. The latter party reached a separate agreement consisting of a promise to abide North Dakota DNC laws and a $1000 fine.

 

NATIONAL DNC ACCESS FEES SET BY SENATE BILL 781

Senate Bill 781, signed into law by the President on February 15, has set the fee for access to the National Do Not Call registry to an annual amount equal to the smaller of either $54 for each area code accessed or $14,850 for access to all area codes within the registry.

Contact Center Compliance Corporation
350 E Street, Suite 300A
Santa Rosa, CA 95404
866-DNC-LIST (866-362-5478)
www.DNC.com

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.

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