TMCnews Featured Article

Automated calling can make a huge and positive impact in terms of sales and marketing, but it is important to keep the Telephone Consumer Protection Act (TCPA) and other applicable regulations in mind when crafting a calling campaign.

Since automated calling is so powerful, and is a relatively easy way to get out the word and reach customers, there’s much room for abuse. That’s why the Federal Trade Commission and other government agencies have put restrictions on how and in what way automated calling can take place. Businesses need to be mindful of these regulations, although a common-sense approach usually can protect businesses from falling afoul of regulatory issues.

A cautionary tale comes in the form of a recent lawsuit against Carnival Cruise Lines (CCL (News - Alert)) and some of its partners. Businesses are not supposed to make automated telemarketing calls without expressed prior consent, but CCL tried to skirt the regulations by calling customers about a political survey and then upselling them by offering add-on cruise offerings afterwards. Political calls are exempt from expressed prior permission, but not calls that also include sales pitches.

The FTC (News - Alert) and 10 states noticed this dodge around consumer regulations, perhaps because CCL and its partners had been making from 12 to 15 million calls per day for approximately ten months with these masked sales calls.

CCL settled the case and has agreed to pay $500,000 of a $7.2 million penalty.

There are a number of lessons from this case that businesses should keep in mind.

First, the FTC and states work closely together in telemarketing enforcement; 10 states joined this suit with CCL. The states that often are actively pursuing violations are Florida, Indiana, Mississippi, North Carolina, Ohio and Washington State.

Second, partners also are subject to these regulations, as the suit indicates, and businesses can fall afoul of the regulations simply by authorizing such calls — they don’t need to place the calls themselves.

Third, the FTC may impose a variety of remedies when violations are discovered, including requiring the seller to monitor its lead generators. It also may bar the seller from purchasing leads from a lead generator who is determined by the seller to obtain leads through unlawful practices.

Automated calling is powerful. That’s why it is regulated; there is much room for abuse. Smart businesses know to leverage auto dialers — but they also know to do so responsibly. With great power comes great responsibility.