Key Provisions of the FTC's Telemarketing Sales Rule
The Federal Trade Commission's (FTC) Telemarketing Sales Rule sets strict guidelines for telemarketers. These rules require telemarketers to make specific disclosures, limit when they can make calls, and give consumers the power to stop unwanted calls. The rule is aimed mainly at consumer telemarketers, but it also applies to business-to-business marketers of non-durable office goods (paper, toner, and other consumables) and cleaning supplies.
No matter the size of your business, you're subject to the rule if you telemarket across state lines. If you outsource telemarketing, you could be held liable if the firm you hire violates the rule. Penalties can be stiff, with fines of up to $10,000 per violation. So before you begin dialing for dollars, consider some of the key provisions of the Telemarketing Sales Rule.
A telemarketer cannot:
- Call a consumer's residence before 8 a.m. or after 9 p.m.
- Call consumers who have requested they not be called. Telemarketers must keep and abide by "Do not call" lists, the directory of people who have asked not to receive unsolicited sales calls.
- Withdraw money from a consumer's checking account without express, verifiable authorization.
- Misrepresent any information or lie to gain a consumer's business.
On all outgoing calls, telemarketers must disclose:
- The seller's identity
- That the purpose of the call is to sell goods or services
- The nature of the goods or services offered
- The fact that no payment or purchase is necessary to enter or win a prize promotion
Before a customer pays for goods or services, telemarketers must state:
- The total cost and quantity of the goods or services
- Any restrictions on obtaining or using the goods or services
- Whether a sale is final or nonrefundable
- The terms and conditions of any refund policy
- The specifics of a prize promotion: the odds of winning, the fact that no purchase or payment is necessary to win, and any restrictions or conditions on receiving the prize.
