Telemarketing Laws

It usually happens just as you're sitting down to dinner with your family. The phone rings, you answer it, and then there is a long pause and perhaps a few clicks, followed by a well-rehearsed sales pitch or even a recorded message. Telemarketing is not necessarily illegal, and consumers often agree to such calls unknowingly, but telemarketers are bound to laws that place certain limits on how they conduct their business.

This article serves as an overview of telemarketing (telephone marketing) laws and regulations. For more consumer-based topics, see FindLaw's main Consumer Protection page.

Federal Rules for Telemarketers

The Telephone Consumer Protection Act (TCPA) was passed in 1991 in response to consumer complaints of increased marketing calls and automated, pre-recorded messages. Invoking the authority of the TCPA, the Federal Communications Commission (FCC) enacted rules requiring telemarketers (defined as anyone soliciting you via telephone) to provide the following information:

• His or her name
• Name of the entity (typically a business) on whose behalf the call is being made
• A telephone number or address at which this entity can be contacted

Also, the TCPA prohibits telemarketers from calling your home before 8:00 a.m. or after 9:00 p.m.

The Telemarketing Sales Rule enforced by the Federal Trade Commission (FTC) requires additional disclosures and prohibits intentional misrepresentations. This rule also covers calls made by consumers in response to offers or solicitations made via the mail or the Internet. Use the following information to determine whether or not you are speaking with a legitimate telephone marketer:

• If you have asked not to be called by a particular telemarketer, even if your number is not on the National Do Not Call Registry, they may not call you again (see "The-Do-Not Call Registry," below).
• Telemarketers are required to tell you whether it is a sales call and the name of the entity doing the selling. If the caller says you've won a prize, they are prohibited from requiring any type of payment prior to receiving the prize.
• Telemarketers may not misrepresent information about products, prizes, investments, etc.
• Telemarketers must be clear about the total cost of any goods or services offered, plus the terms of the sale. If a prize is being promoted, you must be told the odds of winning and that no purchase is necessary to win.
• Credit repair, advance-fee loans, credit services and other financial services are payable only after they have been performed or delivered.

Exceptions to the rule include catalog sales; consumer-initiated calls that are not in response to a solicitation; uncompleted sales; sales of pay-per-call services; calls responding to advertisements that already include all required disclosures; and consumer calls responding to general advertisements.

The Do-Not-Call Registry

One way to limit telephone solicitations to your home or mobile phone is to register your number(s) with the national Do-Not-Call Registry. Commercial telemarketers are prohibited from calling any numbers that are on the Registry within 31 days of their listing. There are some exceptions, though, as the Registry does not prevent the following types of calls:

• Calls from businesses or other entities with which you already have done business (although you may individually request removal from their call list)
• Calls from entities that have received your prior written permission
• Non-commercial calls or those without unsolicited advertisements
• Calls from tax-exempt non-profits

To register your home telephone or mobile phone number, either visit the national Do-Not-Call Registry online or call 1-888-382-1222 (TTY: 1-866-290-4236).

If a telemarketer calls you after 31 days of adding your number(s) to the Do-Not-Call Registry, then you may file a complaint via the FCC's electronic complaint form or by calling 1-888-CALL-FCC (TTY: 1-888-TELL-FCC).

Telemarketing Fraud

While telephone marketing calls can be annoying, sometimes a call that seems like a routine sales pitch actually is a scam. In fact, the FTC claims consumers lose billions of dollars each year to such fraudulent activity.

Scammers usually acquire numbers from telephone directories, mailing lists, and so-called "sucker lists" with the names and numbers of people who are known to have responded to telephone solicitations in the past. Similarly fraudulent solicitations are done via direct mail, advertisements in newspapers, or online (including email).

Often, the scammer will use one of the following methods in an attempt to separate you from your money:

• Sweepstakes and Prize Offerings: If you're required to buy something, pay a fee, provide a credit card number, or attend some kind of presentation, then it's probably a scam.

• Vacation Offers: Unsolicited calls offering a "free" or "discounted" travel package often are bogus and you may end up paying quite a bit in hidden costs and expenses.

• Charities: Some red flags that the caller may not be representing a legitimate charity include the use of real-sounding but fake charity names or an unwillingness to send written information about the organization.
• Investment Opportunities: As with most investment offers, anything promising high returns with very little risk is probably not a legitimate offer. If you are unable to find additional information elsewhere, it's probably not legitimate.
• Recovery Services: Adding insult to injury, some of these recovery scams actually promise to get your money back from previous scams. Never pay upfront for any such services and beware of guarantees.

Never give out personally identifiable information (especially your Social Security Number), bank account number, or credit card numbers to an unknown caller and always be suspicious of offers made by unsolicited callers. Consider speaking with a consumer protection lawyer if you believe you are the victim of a scam or have additional questions about telemarketing laws.