Among the myriad of privacy related laws and regulations, there is the 1991 Telephone Consumer Protection Act (TCPA). This law seeks to regulate unwanted calls, voice messages, texts and other types of telephone communications. Among other things, the TCPA allows individuals and groups to file lawsuits and collect damages for receiving unsolicited telemarketing calls, faxes, pre-recorded calls or autodialed calls.
If your institution uses a telemarketing firm or has automated telephone or mobile marketing program, there are new changes to the TCPA that might affect you.
Effective October 16, 2013, the FTC will implement two significant changes to the Rule:
- The rule will require unambiguous written consent before telemarketing calls or text message are made. These are automatically dialed and pre-recorded messages or “robocalls”. This includes calls to mobile and residential landlines. (Manually dialed calls placed by live people are not covered.)
- The rule eliminates the “established business relationship” exemption for telemarketing. The existence of a prior business relationship no longer relieves the telemarketer of the need to obtain prior expressed written consent prior to making a “robocall”.
These revisions are intended to maximize consistency with the Federal Trade Commission’s Telemarketing Sales Rule.
So how does this affect your institution? First, these provisions do not apply to purely informational or transactional calls such as debt collection calls or account fraud alerts. Second, because the established business relationship exemption no longer applies, your institution will need to obtain written consent from customers and others for your marketing efforts. This can be accomplished in many ways such as in your new accounts forms or on your institution’s website. Please note that the consumer cannot be required to sign the agreement or agree to enter into it as a condition of receiving any service or product (i.e. the consumer does not have to agree to robocall marketing to get a bank account). Third, the required written consent can be obtained electronically in compliance with the E-sign Act such as emails, web site forms, text messages or telephone key press.
As of January 14, 2013, the TCPA rule already required that every prerecorded telemarketing message must provide an automated, interactive voice- and/or key press-activated mechanism for the consumer to request no further telemarketing calls from the sender. This opt-out mechanism must be presented, within two seconds of the callers statement of identity at the beginning of the message. When a consumer uses this opt-out mechanism, their number must be automatically added to the callers “do not call list”. The caller must end the call immediately at that time.
Institutions should review any telemarketing program used either in-house or with a third party. The telemarketing system must have an opt-out mechanism and obtain clear consent prior to providing the automated message. If these requirements are met, your institution and its marketing program should be fine.
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