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June 2009 | Volume 28 / Number 1
On The Line

Questions You Must Answer About Compliance

By Tim Searcy
CEO, American Teleservices Association


I don’t even play a lawyer on television, and I did not stay at Holiday Inn last night, but for some reason I get a lot of “expert witness” style questions about regulatory compliance. Compliance in the contact center space is a cottage industry and a passionate pursuit for many of my members. The American Teleservices Association takes pride in being the definitive source for answers related to how to keep your calls, your personnel, and your contact center in compliance with federal and state laws and regulations.

Recently, I have been getting some inquiries that I think may foreshadow even more questions and regulation. Although I may not answer all the questions, it is important that you start asking them.

• Negative Option Disclosure


Regulators, and in particular state policy makers, have never been big fans of this type of marketing offer. To keep yourself out of trouble, you need to ask whether your customer is clearly made aware of payment parameters and/or auto-renewal arrangements. Clarity is the name of the game, followed quickly by digital recording of confirmations for these kinds of purchases regardless of whether this is an inbound or outbound call. (Note: This is becoming more frequent in cellular phone bills, as an example, when game services and dial tone “membership” fees reoccur without proper notice to consumers.)

• Verified and Recorded Authorizations

Do you have accurate, searchable and complete recordings of authorizations for calls which require this level of information? Often companies fail to keep accurate records, or more importantly when contested by consumers, recordings of consumer authorization for charging or enrollment. Absence of this tool, while technically not required, will leave companies extremely vulnerable as they must have evidence of consumer understanding and agreement.

• Grooming Call Lists for Cellular When Using Dialers

Are you scrubbing cellular phones from your lists? Contact centers rely on predictive dialing equipment to make programs efficient and profitable. But you can have the greatest set-up and still fall out of compliance by not preventing those dialers from calling cell phones. This is a very common oversight, even though there are a number of cell phone list providers. It has resulted in a flare up of non-compliance and state enforcement actions as the consumer migrates to cellular-only communication.

• Relationship Disclosure

As an in-house operation or outsourcer, are you properly abiding by the myriad of state laws and the federal requirement for disclosure? If you are a service bureau working for a product provider (Seller), you must represent that you sell for them and identify your company as well as theirs.

• Last, but by no means least - Caller I.D. “Spoofing”

How are you identifying your firm in the Caller Identification you send through your carrier? Although as an outsourcer, you may be fulfilling a third party service contract for the biggest and most recognizable company in the US, you better not put their name on your caller ID! And whatever number you list better work, because it is incumbent upon you as a telemarketer to post a number on caller ID that can ring back to your company for do-not-call requests. It must be your firm, and it must work! This is the second most non-compliant practice we see, and it is a huge frustration to regulators.

These questions nibble around the edges of compliance and address some of the current concerns that we hear in Washington DC from regulators at the FTC and FCC. But the most frequent abused practice which will require further effort on the part of industry is the use of pre-recorded messages. Whatever limited, legitimate and legal means for the use of this technology remains will be greatly modified in September of this year. Here are the key components of the new rules:

• As of September 1, 2009, a company may only contact a consumer if there is Express Written Consent.

• Additionally, this consent must clearly and conspicuously disclose that purpose of agreement is to allow pre-recorded calls. This consent must be given with a telephone number, and either a physical or digital signature.

Now as I said before, I am not a lawyer, and I can’t give legal advice. However, these questions provide a good starting place for you to initiate a dialog with in-house or outside legal counsel. Additionally, the ATA provides a wealth of compliance information to its members and on our website at www.ataconnect.org.

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