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Wednesday, October 18, 2006

Law - Prerecorded calls stymied at both federal and Indiana levels

Cindy Skrzycki, who writes The Regulators column every week in the Washington Post, reports:

The Federal Trade Commission effectively slammed the phone down on the U.S. telemarketing industry earlier this month, rejecting a request to allow prerecorded calls to consumers without their expressed consent.

Acting on a 2004 petition filed by Voice Message Broadcasting Corp. of Costa Mesa, Calif., the FTC decided it wouldn't allow companies to use taped calls, even if they claimed a "prior business relationship" with the consumer. The only way around the ruling, the agency proposed, would be if the customer consented in writing that he was willing to accept such calls.

"This adds protection for consumers so they don't have to deal with prerecorded messages," said Allen Hile , assistant director of the FTC's Division of Marketing Practices.

The decision followed an outpouring of 13,600 comments -- all but 600 in opposition to the request. Many pleaded with regulators not to create a loophole in the National Do-Not-Call Registry, which allows consumers to limit the telemarketing calls they receive and contains some 130 million numbers. [ILB added emphasis]

"The Do-Not-Call list has been enormously successful," said Marc Rotenberg , executive director of the Electronic Privacy Information Center , a District-based group that monitors privacy issues and filed comments against the industry request. "More people signed up for it than voted in the last election -- Bush and Kerry combined. It's a very clear statement Americans don't want to hear from telemarketers."

Meanwhile, Indiana's attorney general, Steve Carter, has begun enforcing laws against prerecorded calls at the State level. See for example, this press release from Sept. 18, 2006:
Jeffersonville, IN – Indiana Attorney General Steve Carter is seeking a preliminary injunction and has filed a lawsuit against the Economic Freedom Fund for making illegal, pre-recorded telephone calls to Indiana consumers in violation of the state’s statute regulating automated phone calls.

“The key is receiving information that provides some details of the call, including the number that was called and the time the call was made,” Carter added. “Whether based out-of-state or in-state, anyone wanting to place pre-recorded calls into Indiana must abide by the statute.”

At least seven complaints have been filed against Economic Freedom Fund for playing pre-recorded phone calls to the consumers without receiving their permission prior to playing the recording. The information provided to the attorney general’s office indicates the calls have been made since at least last Monday, September 12, 2006.

“Taking immediate action to stop any further calls to the state is important to protect people’s privacy during the time that the case progresses through the courts,” Attorney General Steve Carter said. “The quick action by people who actually received the calls to get their information to the attorney general’s office was critical in being able to take this action so quickly.”

This is the seventh company that the state has either filed suit against, or reached court-ordered agreements with for alleged violations of federal or state statutes regulating automated and pre-recorded calls.

Indiana’s “Automatic Dialing Machine” statute [IC 24-5-14-5] specifically states:

Sec. 5. (b) A caller may not use or connect to a telephone line an automatic dialing-announcing device unless:
(1) the subscriber has knowingly or voluntarily requested, consented to, permitted, or authorized receipt of the message; or
(2) the message is immediately preceded by a live operator who obtains the subscriber's consent before the message is delivered.

Complaints against automated calls can be made at www.IndianaConsumer.com.

The lawsuit and preliminary injunction were filed in Circuit Court in Brown County, IN.

Posted by Marcia Oddi on October 18, 2006 08:19 AM
Posted to General Law Related