Tuesday, September 01, 2009

FTC Raises Fees for Accessing Do-Not-Call Registry . . .

This posting was written by Jeffrey May, Editor of CCH Trade Regulation Reporter.

The Federal Trade Commission has announced increases to the fees for accessing the Telemarketing Sales Rule’s Do-Not-Call Registry.

Rule revisions will increase the annual fee for access to the registry for each area code of data to $55 per area code (up from $54), or $27 per area code of data during the second six months of an entity’s annual subscription period. The maximum amount that would be charged to any single entity for accessing area codes of data is increased to $15,058 (up from $14,850). The fee increase takes effect October 1, 2009.

The final rule increasing fees appears here in the Tuesday, August 24, 2009 issue of the Federal Register.

. . . Announces Settlement Prohibiting Deceptive “Robocalls”

On September 1, 2009, the same day the Telemarketing Sales Rule’s prohibition on “robocalls” took effect, the FTC announced a settlement with a warranty company that prohibits the company and its owner from making any prerecorded calls to trick consumers into buying vehicle service contracts under the guise that they were extensions of original vehicle warranties.

The agency alleged that the company, Transcontinental Warranty, Inc., bombarded consumers with millions of the prerecorded calls earlier this year.

Transcontinental Warranty is one of several companies behind the auto warranty scam that the FTC sued in response to a flood of complaints about the robocalls, which used random, prerecorded voice messages to deceive consumers into thinking that their vehicle warranties were about to expire, according to the agency.

The FTC also has filed a complaint against the telemarketers who made the prerecorded calls, Voice Touch, Inc., Network Foundations, LLC, and Voice Foundations, LLC, as well as their three principals. That case is still pending in federal court. The court has barred the defendants from making any further deceptive robocalls until the litigation is resolved.

Under the proposed consent decree, Transcontinental and its owner, Christopher Cowart, will be barred from the deceptive tactics they used to sell its vehicle service contracts.

The defendants also will be prohibited from selling Transcontinental’s customer lists or trying to collect money from people who were victimized by the scam. In addition, they will be required to cooperate in the FTC’s ongoing investigation of the related case. The proposed settlement includes a $24 million judgment against the defendants, which is suspended because of their inability to pay.

A press release and the proposed consent decree in FTC v. Transcontinental Warranty, Inc., FTC File No. 0923110, appears here.

New Rule on Prerecorded Messages to Be Enforced

In announcing the settlement on September 1, the FTC took the opportunity to remind telemarketers that it would begin enforcing a new rule restricting prerecorded calls.

Telemarketers who transmit prerecorded messages to consumers without their prior written agreement could face penalties of up to $16,000 per call.

There are some prerecorded calls that will not be subject to the new rule, such as those that deliver purely “informational_ messages, and calls from politicians, banks, telephone carriers, and most charitable organizations, according to the agency.

Further information on the new rule appears here on the FTC website.

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