People in the telemarketing industry usually do not perceive fraud as being a big
problem. They point out (and rightly so) that the volume of legitimate business conducted
via telemarketing is so enormous that the "work" perpetrated by frauds who
masquerade as telemarketers fades into insignificance. This position is eminently correct,
at least from a dollars-and-cents point of view. But fraud has another measure: public
opinion. Unfortunately, the public at large is not conversant with industry statistics.
Instead, it relies on general impressions, formed in the alarmist atmosphere created by a
journalism that seeks to excite passion rather than foster reason.
Even worse, so long as the public has a distorted picture of telemarketing, individuals
are liable to confuse legitimate telemarketers and frauds who pretend to be telemarketers.
(Please notice that I have deliberately avoided the phrase "fraudulent
telemarketers." I would no more use that phrase than describe a scalpel- wielding
killer as a "fraudulent surgeon.") Citizens who remain uninformed are vulnerable
to scams and swindles - a state of affairs that puts pressure on our legislators and
regulators to "do something." So, whereas industry professionals know that fraud
shouldn't be a problem, regulatory bodies, which must respond to public opinion, sometimes
see things differently. Fortunately, recent events indicate that our regulatory
authorities are well aware of the importance of telemarketing to the economy, and are more
than willing to consider antifraud measures that do not involve the creation of more rules
and regulations, which could have the effect of making it more difficult to conduct
legitimate business. Such measures include programs to educate consumers. It is imperative
that consumers learn how to 1) recognize fraud and 2) report it to the appropriate
authorities.
Existing regulations will prove ineffective if consumers remain uninformed. As industry
professionals, we should make every effort to cooperate with bodies such as the Federal
Trade Commission (FTC) to educate the public and make further regulation unnecessary.
The FTC: Doing What's Right For The Consumer And Our Industry
The more I work with the FTC's Division of Marketing Practices, the more I become
convinced of the wisdom and forbearance of our government's senior authorities. Division
officials Eileen Harrington (associate director) and Judith Nixon (senior attorney and
co-author of the FTC's Telemarketing Sales Rule) are among our government's elite. They
recognize that the great majority of telemarketers are decent and law-abiding members of
the business community, and they are genuinely respectful and supportive of our industry's
role in the nation's economy. They are also aware that a few frauds can do a great deal of
damage to our industry's reputation.
We should count ourselves fortunate that the FTC has taken an interest in eliminating
fraud. In a sense, they have delivered our industry a wake-up call: our reputation is at
risk. We do not have to accept this risk. Instead, let's work with the FTC to make it more
difficult for criminals to use the phone to defraud citizens, and leave the (false)
impression that such acts are somehow characteristic of the telemarketing industry.
How To Detect Frauds
Most of us are familiar with the usual scams. We may find it hard to believe that others
would fall prey to them. But many do, particularly the elderly. Furthermore, many younger
people are fooled as well, taken in by phony investment schemes and real estate
"opportunities."
To make life more difficult for frauds, I suggest we develop and promulgate fraud
detection guidelines. In future issues, we will contribute to this process by offering our
own guidelines for fraud control. In the meantime, I would like to point out that any list
of guidelines should make this point up front: If someone makes you an offer that sounds
too good to be true, you can safely assume that it is. Every consumer should consider this
point before even thinking of giving his or her credit card number over the phone.
Consumers should know that if they have any doubts about divulging credit card information
over the phone, they should hang up immediately.
How To Treat Suspected Frauds
If you suspect fraud, or are aware of unlawful practices being perpetrated over the phone,
alert the authorities immediately. The sidebar accompanying this editorial lists the
appropriate contacts in the offices of the Attorneys General.
Contacting the authorities is the least we can do to ensure that existing antifraud
statutes are enforced.
Eternal Vigilance: Every Telemarketer's Duty
We all know, from sobering experience, that legal measures sometimes make a blunt
instrument in combating fraud. Consequently, telemarketing's leaders are concerned that
regulations intended to curtail fraud can end up frustrating legitimate business. To make
further regulation unnecessary, we should concentrate on doing what we can to make sure
existing regulations are effective. Again, this is an issue of education and public
awareness.
I urge all readers of Telemarketing(R) & Call Center Solutions(TM) magazine, all
attendees of TCCS(TM) (Telemarketing & Call Center Solutions(TM) Conference and Expo,
formerly TBT(R), Telemar-keting and Business Telecommunica-tions Conference and Expo), and
all vendors serving the field to unite behind the FTC in a crusade to inform the public
about acceptable telemarketing practices. The onus is on us, as telemarketing's leaders,
to protect the good name of our industry.
Eileen Harrington To Address General Assembly At TCCS SPRING '96
I am pleased to announce that Eileen Harrington of the FTC will speak at TCCS(TM) SPRING
'96. After I became aware of the far-reaching expertise that Eileen holds as the associate
director of the Division of Marketing Practices, I personally invited her to share with us
some of her ideas on the problem at hand, and what solutions the industry might apply to
control and prevent fraud. She will speak immediately before the keynote presentation on
Tuesday, May 21, 1996. All readers of Telemarketing� & Call Center Solutions
are invited to join us at TCCS SPRING '96, which will be held May 20-23, 1996 at the
Long Beach Convention Center, Long Beach, California.
Other Dynamic And Prestigious Speakers At TCCS(TM) SPRING '96
The upcoming event in Long Beach will include two vitally important keynote addresses:
- Thomas O. Jones, president of Elm Street Technologies and former senior lecturer at
Harvard University Graduate School of Business Administration, will speak on Creating
Customer Loyalty: Your Most Critical Challenge.
- Scott B. Ross, president of Business Operations and chief financial officer at MCI
Telecommunications, will speak on Unlocking the Power of the Virtual Call Center and the
Internet: The New Forum for Business.
Both of these addresses cover material that is crucial to the future success of large
and small call centers. The importance of these topics, which will tell you what it takes
to be on the cutting edge in advanced marketing, cannot be underestimated. For more
information on the TCCS(TM) SPRING '96 program, see the insert between pages 64 and 65 in
this issue or call 800-243-6002 or 203-852-6800.
I look forward to welcoming you to Long Beach on May 20, for what promises to be the
finest conference and exposition our industry has ever seen. P.S.: Don't buy anything
until you have visited the TCCS(TM) Exhibit Hall. Admission to the Exhibit Hall is FREE if
you register by May 10, 1996.
Sincerely,
Nadji Tehrani
Publisher & Editor-in-Chief |