The imperative role of compliance in telemarketing and lead generation

In our webinar, “Minimize litigation risks through sustainability in third-party lead gen,” industry leaders Margaret Wise, CRO at ActiveProspect, and Michele Shuster, Managing Partner at McMurray & Shuster, LLP, came together for a powerful discussion.

With deep expertise in regulatory strategy, they delivered an insightful conversation on the legal and compliance aspects of telemarketing, lead generation, and the challenges of managing threats and lawsuits, particularly under the Telephone Consumer Protection Act (TCPA).

Key takeaways

Here are the main takeaways that emerged from our Lead Gen Leaders-specific webinar:

• Good actors are those who thoroughly analyze legal requirements and best practices, ensuring transparency in consumer interactions.
• Bad actors misrepresent lead information and consent, leading to significant legal and reputational risks.
• Retaining records of consumer consent for at least 5 years is crucial for legal defense.
• Ignoring threat letters is the worst possible response; a proactive defensible position can often shut down threats early.
• ActiveProspect’s solutions can help you document and retain the consumers’ consent to contact transactions, and review your consent language automatically.

Let’s dive deeper into the topics highlighted above.

Good actor vs. bad actor: Defining ethics in the lead gen industry

Michele believes that a good actor is someone who takes the time to deeply understand the process, the legal requirements, and the best practices. In lead generation, it’s crucial that consumers clearly understand the interaction they are engaging in.

The best actors not only follow the law and best practices but also ensure that consumers are fully aware of what will happen as a result of their interaction.

On the other hand, the worst actors misrepresent the information they share with buyers. Michele has seen cases where companies were told that the phone calls they received were all from inbound consumer calls, when in reality, they were from an outbound pre-recorded message campaign. When these calls came in, the lead generators transferred them without proper consent, causing significant issues for both the seller and the lead generator.

This kind of misrepresentation and lack of transparency is what makes someone a bad actor in lead generation.

Use TrustedForm to verify and retain consumers’ consent

ActiveProspect offers a product that helps you automatically check that consumers have given consent to be contacted. With TrustedForm Verify you can:

• Reduce risk by ensuring that your disclosure requirements for obtaining prior express written consent are met and presented digitally – enabling scalable auditing.
• Maintain consistent compliance evaluations across all vendors, minimizing errors common in manual reviews.
• Boost productivity by automating tasks that would otherwise require time-consuming manual effort.
• Centralize the data you need to easily assess vendor compliance with your standards.

Once you can prove the accuracy and legitimacy of each lead that you buy or generate, it is always a best practice to keep a record of the consent transaction as proof that you can show in case of potential TCPA litigation.

With ActiveProspect’s TrustedForm Retain you can:

• Store TrustedForm Certificates in your account for applicable statutes of limitations so you’ll have the evidence needed in the event of litigation.
• Satisfy record-keeping requirements established by federal rules and regulations.
• Watch session replays to observe how leads were created.
• Provide a Certificate URL for instant evidence of how consent was given to prevent disputes and safeguard your reputation.

According to Michele, one crucial aspect is that some companies use the ActiveProspect technology to record the lead event but fail to retain the actual documentation of that. Michele emphasizes that companies need to be aware that it’s not just about recording website activity; they must also keep and store that information to have proof of consent to contact.

What happens when there is a threat letter?

When a threat letter arrives, Michele explains that there are several scenarios to consider. 

One common situation is receiving a letter from a pro se plaintiff, an individual who received the call. These letters are often form letters downloaded from the internet, modified, and sent. Language in some of these could have been shared in chat rooms and forums, so if you receive a threat letter, it’s possible that the sender could have shared or discussed it with others.

Another scenario is receiving a threat letter from a plaintiff’s attorney. In this case, the attorney will draft a letter outlining their theory of the case, explaining why the call was illegal, and often requesting proof of consent and the legality of the call before making any demands.

The third scenario involves a letter from a regulator, which could be a civil investigative demand. This type of letter can be particularly serious, depending on whether you are a witness or the subject of the investigation.

Regardless of the source, the response process is similar:

1. Verify that the call actually took place. Surprisingly, sometimes the threat letters are mistaken, and there’s no evidence of the call or the number being associated with your company.
2. Once you confirm the call, gather all the relevant facts. Was it a telemarketing call? If so, did you have an exemption, such as the caller being a current client or having made an inquiry? ActiveProspect is crucial here, as it can provide the necessary information to prove the call’s legitimacy.

The conversation should focus on why the call was lawful. If you can’t provide this information, the discussion might take a different turn, possibly acknowledging a one-off issue or explaining why this case is unique.

Michele estimates that about 25% of the time, you can effectively shut down these threats at the initial stage or at least get the plaintiff to reconsider filing a class action, which she considers a win. In summary, how you respond to that initial threat and prove the legitimacy of your call is crucial, and it can make a significant difference in the outcome.

Michele strongly emphasizes that “ignoring [a threat] is the worst possible thing that you can do.” It’s crucial to be well-prepared for these types of conversations. You need to have all the facts at your disposal. Being able to provide immediate explanations can make a significant difference. If you come prepared with such information, you can often shut down these threats rapidly.

Exclusive vs. shared leads: Compliance considerations and risk management

As Michele explains, the quality of leads may have improved over the past year as the industry was preparing for one-to-one consent. However, with the shift away from that requirement, we’re now back to the previous existing standard of “clear and conspicuous” disclosures.

The language in lead forms must be clear and easily understandable, ensuring consumers know they will receive a call back and who will be calling them. While you can include multiple sellers in a lead form, it must be transparent that the consumer could receive calls or text messages from all of them. This requires close attention to lead forms to ensure any reasonable consumer would understand the implications of completing the form and selecting the call-to-action button.

If you approve a marketing partners list, it’s crucial that the call-to-action button clearly indicates that the consumer is providing consent to receive calls, not submitting a sweepstakes form or expecting a free quote via the website. Being straightforward with clients is essential, and Michele thinks that clear and transparent forms likely convert better.

Good news, bad news: The reality of changing lead gen strategies

Margaret shares that the new approach in lead generation brought both good news and bad news.

The good news is that there were some early indications that conversion rates were higher, and ActiveProspect’s customers who tested this approach found that the overall cost came down. Perhaps this was because they weren’t pushing as many leads through their systems and call centers, leading to higher call conversion rates and even improved morale in the call centers, as agents were reaching people who expected to be called.

However, the bad news is that the industry didn’t embrace this approach as much as hoped. While calling people who expect to be called leads to higher conversions and ensures compliance, the shift wasn’t as widespread as expected. Some providers did see the benefits and decided to stick with the new approach, but many reverted to their previous operating models. This isn’t a compliance issue; it’s more about choosing predictability over change. 

Michele emphasizes the importance of having someone review your lead forms. Given the very technical requirements, having them checked is a crucial preventive measure that can save a lot of trouble down the line.

Review your consent language with TrustedForm

TrustedForm Verify helps you manage your consent to contact language by centralizing it all in one place. 

You can take in leads, parse the consent language, and match it to what is accepted. If there’s no match, the form can go into a queue for you to review and approve. This allows you to build a library of approved language, making the entire process much easier to manage, as it can be overwhelming to handle all of this manually.

As Michele points out, litigation often stems from mistakes. Even good companies with solid processes can run into issues, sometimes simply because they assumed certain language had been approved when it hadn’t. Having a system in place to collect, manage, and categorize lead forms is crucial to avoid these pitfalls.

Conclusion

In an era where litigation risks in lead generation and telemarketing are rising, compliance is no longer optional – it’s a strategic imperative. As Margaret and Michele made clear throughout this webinar, businesses that prioritize transparency, proper documentation, and legal best practices are not only protecting themselves but also building stronger, more trustworthy customer relationships.

Whether it’s defining ethical behavior in lead gen, responding swiftly and effectively to threat letters, or ensuring that consent is properly captured and stored, the key to success lies in preparation and precision. Tools like TrustedForm empower organizations to automate, standardize, and scale their compliance efforts, helping mitigate risk and streamline operations.

Ultimately, those who invest in sustainable compliance practices will not only avoid costly legal battles but also improve lead quality, operational efficiency, and brand credibility. Compliance isn’t just about avoiding fines – it’s about setting the foundation for long-term growth and success in a highly regulated environment.

Watch the full episode now and check out our webinars library for more industry-specific expert content!

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