- What is Telemarketing?
- Warning Signs
- How to say "No"
- Automatic Debit Scam
- Magazine Scams
- Negative Option Scam
- Office Supply Scams
- Telemarketing Travel Fraud
- NFIC's Telemarketing Tips
- National Do Not Call Registry
- Alaska's Do Not Call Law
- Complaint Information
- Telemarketing Laws
What is Telemarketing?
Telemarketing involves situations in which companies call consumers to sell their goods or services, or consumers call companies to make purchases in response to mailings or other forms of advertising. Telemarketing also includes sales solicitations via fax, the Internet and mail, if the consumer is encouraged to respond via the telephone, fax or Internet.
Although a large number of legitimate businesses use telemarketing to reach consumers, this method of conducting business can be easily abused by con artists looking to take advantage of unsuspecting individuals. Telemarketing fraud robs consumers of approximately $40 billion every year.
Fraudulent telemarketers ignore the law and continue to defraud people until they are caught.
For more information:
Warning signs - be suspicious if a telemarketer tries to convince you...
- you just won a prize or contest
- to buy: magazine subscriptions, office supplies, vitamins, vacations, lottery tickets, club memberships, promotional items or give a donation to a charity
- to apply for a loan or credit card that is: guaranteed, pre-approved, or low- interest
- to give the caller any information about your checking or savings account or social security number.
Telemarketing sales pitches or charitable solicitations may be fraudulent if a telemarketer:
- says you've won a prize...or that it is a "free" offer, but that you need to send money for fees, shipping, handling, insurance etc.
- tells you that you have been pre-approved for anything that you have not requested yourself
- asks for your credit card number, bank account number or social security number for any reason at all
- confuses you with fast talk that he/she does not adequately explain
- insists on an immediate decision to guarantee your participation in this wonderful opportunity or limited offer
- offers to have someone pick up your check at your home or office, or requests that you use overnight mail. This can be a sign that the telemarketer wants to avoid inspection under the federal mail fraud law
- offers, for a fee, to repair your credit history
- keeps talking after you've said no
- claims the investment is "without risk".
How to Say "No" to a Telemarketer
- "I do not accept telephone solicitations. Please do not call again."
- "Send me the information in the mail. If I'm interested I'll check it out and get back to you."
Automatic Debit Scams:
Telemarketers can withdraw money from your checking account without permission if you have given them your checking account number and the RTN (routing & transit number) at the bottom left of your check. This means that money can be electronically withdrawn from your bank account and deposited into the telemarketer's account without using paper or having your signature!
Beware of these lines:
- "We can arrange to have the fee debited directly from your checking account in ____ easy payments".
- "I need your checking account number to deposit the prize money into your bank account".
- "I need your account number:
- for identification purposes
- to check your credit
- for confirmation
- to verify your account of payment
- to verify your ability to make payments
- to make the transaction faster and easier".
Always check your monthly statement.
Alert your bank immediately if you believe your checking account:
- has been debited without your approval
- has been debited for more than you authorized
- you revealed your checking account number or RTN to a telemarketer
- you discovered an unauthorized signature with your monthly statement.
For more information about automatic debit scams, read the FTC's Automatic Debit Scams Consumer Alert.
Telemarketing is an easy way for a magazine seller to contact customers. Before you agree to purchase a subscription through a promotional mail/telephone order, stop and carefully review the solicitation. Compare the price you have been offered with what it actually costs to purchase a subscription for the entire year directly from the publisher. Often the annual rate is provided in fine print located in the first few pages of a magazine, or, a telephone number is provided for that information. The annual subscription rate is less than the newsstand rate and is usually much less than the mail/telephone monthly rates offers you may receive. And, check inside the magazine where you may find an introductory offer card that reduces the subscription rate further. BE WARY of a " trial offer". An automatic subscription may follow unless you immediately cancel by written notification. Read the fine print carefully! Monthly rates sound appealing but you may discover that the total cost for the year can run hundreds of dollars more than the annual subscription rate.
If you decide to make a purchase as a result of a telephonic solicitation, carefully review the sales contract and the fine print before you sign it.
Keep records of all contacts between you and the seller.
Negative Option Scam:
While frequently a mail order and internet practice, telemarketers may also use a negative option marketing plan. This means "we'll keep sending you our product until you tell us to stop". It becomes the responsibility of the consumer to cancel the order. When you agree to a free or "trial" product, (magazine, vitamins or supplements, etc.,) you may be committing yourself to a binding contract with the company that requires you to buy a specified amount of merchandise within a limited period of time. Read and understand the fine print of the purchase agreement you receive before signing it.
If you enter into an agreement that involves a negative option plan, pay attention to all the mail you receive from that company. Keep a record of all the orders you place and all the bills you pay. When you decide to cancel a contract after you have complied with all the terms of the agreement, contact the company in writing to cancel future orders. If possible, send your notification by certified mail. Return unwanted shipments and keep records of dates, how the merchandise was returned and copies of all correspondence.
Office Supply Scams:
According to the Federal Trade Commission, the typical office supply scam involves goods or services that you routinely order: copier paper, toner and maintenance supplies, equipment maintenance contracts, or classifed advertising. When fraudulent telemarketers call, they often lie to get you to pay for items you didn't order; get you to pay more than you agreed to, by falsely claiming to be your regular supplier; or by telling you that the offer is "special" or "good for a limited time only." Con artists take advantage of holes in your organization's purchasing procedures or of unsuspecting employees who may not be aware of office practices. The supplies peddled by these bogus firms are often overpriced and of poor quality; the services usually are worthless. The Federal Trade Commission suggests that you buy from people you know and trust. Authorized employees should be skeptical of unsolicited calls and feel comfortable saying "no" to high pressure sales tactics. Legitimate companies don't pressure you to make a snap decision. Finally, consider asking new suppliers to send a catalog first for your review so that you can compare prices without being pressured.
Protect yourself and your business by learning to recognize the scams before you become a target. Read the FTC's publication - Avoiding Office Supply Scams.
Telemarketing Travel Fraud:
Telemarketing Travel Fraud Information from the Federal Trade Commission: http://www.ftc.gov/bcp/conline/pubs/tmarkg/trvlfrd.htm
National Fraud Information Center's Telemarketing Tips:
The National Fraud Information Center (NFIC) was originally established in 1992 by the National Consumer League, the oldest nonprofit consumer organization in the United States, to fight the growing menace of telemarketing fraud by improving prevention and enforcement.
National Do Not Call Registry:
Registering your phone number with this registry is free. You can register online at www.donotcall.gov or call 1-888-382-1222, TTY 1-866-290-4236, from the phone number you wish to register. Your number will stay registered for five years or until the number is disconnected or you remove the listing.
Telemarketers have to purchase the do-not-call list from the FTC, and they have to delete from their calling lists the phone numbers from the registry. Violators of the do-not-call provisions could be subject to penalties of $11,000 per call.
Having your number on the federal do-no-call list will not stop all unwanted solicitations. There are several exemptions to the law. For instance, if there is a "preexisting business relationship," a telemarketer can call a consumer for a period of up to 18 months after the consumer's last transaction with the seller. Also, if the call is for the purpose of conducting a survey, or is a political solicitation, or is a solicitation for a charitable organization, the Do Not Call Registry is not applicable.
Under the FTC's rules, consumers who don't want to register for the National Do Not Call Registry can still tell telemarketers that they don't wish to receive solicitations. Businesses are required to maintain lists of consumers who have made a do-not-call request, and it is a violation to call a consumer who has asked to be placed on the company's do-not-call list. This company-specific request takes precedence over the "preexisting business relationship" exemption. In other words, even if you have made a recent purchase from a company, if you tell the company you do not want to be solicited by phone, the company is required to comply with that request. Similarly, you can use the company-specific option to ask a paid fundraiser for a charitable organization to stop soliciting you by phone.
Alaska's Do Not Call Law:
It is a violation of Alaska's Consumer Protection Act for a telemarketer to 1) call an consumer in Alaska whose phone number is registered with the national Do Not Call registry, 2) call a consumer in Alaska who has previously communicated to the telemarketer or charitable organization that the consumer does not wish to receive telephone solicitations, or 3) originate a telephone call using an automated or recorded message as an advertisement or solicitation.
For information on how to register your telephone number to reduce unwanted telephone solicitations, go to the National Do Not Call Registry website.
Where to complain about unwanted calls:
You can file complaints about unwanted telephone calls with the FTC at www.donotcall.gov, with the FCC at www.fcc.gov, and with the Consumer Protection Unit of the Alaska Attorney General's Office. Read about the complaint process and download a complaint form or call (907) 269-5200 or toll free at 888-576-2529.
The Federal Trade Commission (FTC) has adopted strict rules that offer protection against telemarketing fraud. These rules require that certain information be given to consumers and prohibit telemarketers from engaging is certain actions:
- A telemarketer may not call you if you have previously asked not to be called.
- A telemarketer may only call between 8:00 a.m. and 9:00 p.m.
- Before starting a sales pitch, the telemarketer must tell you that the call is a sales call, the name of the seller and what is being sold. If it is a prize promotion, the telemarketer must tell you that no purchase or payment is necessary to enter the contest or win the prize.
- Telemarketers may not misrepresent any information. All facts must accurately represent the goods or services, investment opportunity or prize.
- Before you pay for anything, the telemarketer must tell you the total cost of the goods, any restrictions on getting or using them, and whether the sale is final. In a prize promotion, you must be told the odds of winning and that no purchase or payment is necessary to win. The telemarketer must also inform you of any restrictions or conditions for receiving the prize.
- It is illegal for a telemarketer to withdraw money from your checking account without your written, verifiable, authorization.
- A telemarketer cannot lie to get you to pay.
Additionally, Alaska laws AS 45.63.010 - AS 45.63.100 and 9 AAC 14.010 - 9 AAC 14.900 requires the telemarketers to be registered with the Alaska Department of Law prior to engaging in telemarketing in the State; and
- Prohibits a telemarketer from soliciting payment from a consumer until after the telemarketer receives from the consumer a signed, written contract for the purchase. This means that the telemarketer may not ask for your credit card number over the phone unless you have signed a written contract.
- Requires the telemarketer to give the consumer a refund, credit or replacement if:
- the consumer returns the property with a written request, within 7 days after receiving the property; or
- the property is defective, not as represented, or is not received as promised buy the seller;
- Prohibits a telemarketer from obtaining from a buyer a waiver of the buyer's rights under the telemarketing law
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