2015 GNYADA MEMBERSHIP DIRECTORY

HOT TOPICS 2015 GNYADA Membership Directory

messages to that designated cell phone number as well. For this reason, it would be unlawful to send a consumer a text message requesting their consent for future text messages, even if they respond affirmatively.

The FCC also regulates telemarketing under the TCPA. Under amendments to its rules that took effect in 2013, a prior express written consent is required for all prerecorded or artificial voice calls to both cell lines and residential lines. Again note that text messages are considered a form of calls. Under the FCC’s rules, a consumer’s prior express written

consent is required for all prerecorded telemarketing calls, for auto-dialed live agent as well as prerecorded telemarketing calls to cell phones, and for telemarketing text messages. A pre-existing business relationship is no longer sufficient. Auto dialers are any device that“has the capacity”to dial or store numbers without human intervention no matter how it is used. Even if the machine is being used to make calls manually, if the device has the capability of autodialing, it will be considered an auto dialer and the call treated as if it were made by an auto dialer, even if dialed manually. So a human beingmaking calls on such a device is not protected from liability. Prerecorded telephone calls must also have an automated up-front opt-out mechanism and no more than 3% of outbound calls in a campaign may be abandoned (calls are considered abandoned when a connection to a live agent is not made within two seconds of answering). Abandoned calls must give the opt-out mechanism as well. The written signed consent must be sufficient to show the consumer received “clear and conspicuous”notice of the consequences of giving their consent to receive telemarketing calls; unambiguously consented to receive calls to the exact phone number stated in the signed consent; and that the customer did not give the signed consent as a condition to purchase or receive any goods or services. Note that this heightened prior written consent requirement applies to prerecorded calls made to residential phones as well as calls and text messages to cell phones. The changes are important because the TCPA provides for unlimited strict liability of $500 - $1,500 per call or text message made without obtaining proper advance consent. Numerous class actions have been filed under the TCPA in large part because of the absence of any cap on class action damages. Some states also give consumers three-day cancellation rights for telemarketing sales and a number of states have tougher telemarketing sales rules than the FTC and FCC. Examples include Texas, New Jersey, Arizona, Louisiana, andWyoming.

In 2012, the Consumer Financial Protection Bureau (CFPB) issued two $200 million consent decrees

against credit card companies for deceptive telemarketing of credit protection aftermarket products, and the CFPB made clear that the requirements of those consent decrees apply to other creditors as well. Among other things, when telemarketing products, a dealer must state promptly the purpose of the call; clearly disclose, prior to purchase, the cost of the product; disclose prior to purchase all material conditions, benefits and restrictions relating

102