The latest FTC updates to the Telemarketing Sales Rule (TSR)

The Federal Trade Commission (FTC) recently unveiled a significant update to the Telemarketing Sales Rule (TSR) with the aim of modernizing regulations. Telemarketers are now mandated to maintain meticulous records of all outbound telemarketing activities and some B2B (Business-to-Business) telemarketing activities are also now covered under the TSR. These adjustments are designed to align the TSR with evolving technologies while bolstering protections for both consumers and businesses against telemarketing calls.

Latest Telemarketing Sales Rules updates:

Minimized deceptive B2B telemarketing

For years, B2B (Business-to-Business) telemarketing calls were largely exempt from certain stipulations of the Telemarketing Sales Rule. But with the rise of B2B scams, particularly through telemarketing channels, the FTC has extended the rule’s prohibition on deceptive and misleading statements to these calls.

It’s important to note that while the TSR has changed to minimize deceptive practices in B2B interactions, the Do Not Call (DNC) requirements have not been extended to cover B2B calls. Nonetheless, ambiguity remains for telemarketers because many individuals use their phones for both personal and business purposes, blurring the lines of these distinctions. Additionally, B2B telemarketers must still heed TCPA autodialer rules and various state laws.

B2C DNC record-keeping

B2C (Business-to-Consumer) telemarketers must now keep their DNC records for a period of five years — up from two years. This revision aligns with the statute of limitations for civil penalties, suggesting that the FTC expects businesses to maintain documentation for the entire period during which they can be held accountable. This change implies that companies may need to revise their sales staff’s outbound calling processes and records maintenance to help them remain compliant.

Key requirements:

Telemarketers must maintain various records to support DNC safe harbor and keep up with compliance and regulatory standards. These records include:

• Call record details: Detailed information about telemarketing campaigns, including calling number, called number, time, date, duration of the call, disposition of the call, and utilization of prerecorded messages.
• Customer information: Details such as name, last known telephone number and address, purchased goods or services, purchase date, shipment or provision date, and payment amount.
• Established business relationship (EBR) records: Documentation demonstrating a seller’s relationship with a consumer, including inquiry or application dates and relevant goods or services.
• Consent records: Records of consumer consent, including name, phone number, copy of requested consent, date of consent, and purpose for consent.
• Opt-out requests: Information regarding individuals opting out of receiving calls, including name, request date, associated telephone number, and relevant seller information.
• National Do-Not-Call registry usage: Records indicating access to the DNC Registry, including entity name, access date, subscription account number, and associated telemarketing campaigns.
• Service provider records: Documentation of all service providers used for outbound calls, including contracts and enforcement of record retention requirements.
• Compliance timeline: The FTC allows a 180-day grace period for compliance with the call detail records retention requirement after the rule’s publication in the Federal Register. This timeframe provides affected businesses with an opportunity to implement necessary systems, software, or procedures to meet compliance standards.

Safe Harbor

A narrow safe harbor provision has been added to account for inadvertent errors in record-keeping. Companies have a 30-day window from the date of discovery to rectify mistakes. However, given the FTC’s history of enforcing TSR regulations, businesses would be wise to focus on confirming their retention practices from the outset rather than relying on the agency’s discretion.

Upcoming timing and changes

Changes to the TSR become effective on May 16, 2024. An 180-day grace period will be extended as businesses adjust to the new TSR record-keeping requirements which will take full effect on October 15, 2024. This timeline is crucial for businesses to prepare and properly align their compliance strategies.

What does this mean for my business?

The FTC wanted to make abundantly clear that common practices previously employed by telemarketers or lead sellers, such as maintaining a list of IP addresses and timestamps as proof of consent, are insufficient to demonstrate that a consumer has provided consent to receive robocalls or receive telemarketing calls when the consumer has registered her phone number on the DNC Registry.

Companies that used to rely on those types of lists have been clearly told they need to start retaining better proof of consent. Sellers or telemarketers must now maintain records of that consumer’s name and phone number and validate that the name/phone number is recorded on a certificate.

For telemarketers or sellers who obtain consumer consent via a website, the Commission believes the new record-keeping provision requiring records of “a copy of the request for consent in the same manner and format in which was presented to that consumer” would require a telemarketer or seller to keep a copy of the webpage or web pages that were used to request consent from the consumer. This is where TrustedForm comes into the fold.

How TrustedForm can help address the new record-keeping requirements

In today’s regulatory landscape, TrustedForm certificates serve as an indispensable tool for demonstrating compliance and building consumer trust. With increased scrutiny on consent verification methods, TrustedForm offers a proactive and transparent solution by documenting the webform or lead ad consent to contact transaction. This level of detail is no longer a mere recommendation but a critical component of regulatory risk and compliance within the TSR framework especially when third parties could be involved in the lead sourcing and the transaction.

Lead sellers and telemarketers utilizing website forms to obtain consent must now retain copies of the exact web pages where consent was provided. TrustedForm certificates provide comprehensive records of web interactions and they are safely stored for up to five years.

Additionally, TrustedForm’s Enhanced PII Protection feature masks form fields containing personally identifiable information until validated, safeguarding consumer data and preventing malicious entities from accessing sensitive information prematurely.

Final thoughts

Considering the recent updates and revisions in telemarketing regulations, it’s crucial for companies involved in activities falling under the revised Telemarketing Sales Rule and TCPA rules to carefully examine these new requirements. This entails consulting with legal counsel and making necessary adjustments to internal procedures to help remain compliant. But adapting to the latest FTC enforcement trends is more than just a legal requirement—it’s about preserving the integrity of digital lead generation and telemarketing practices and protecting both businesses and consumers from fraud. 

The FTC’s message is clear: companies that engage in telemarketing must hold themselves to the highest standard of honesty and accuracy in their communications. If your business is navigating the complexities of the updated TSR, it’s time to solidify your proof of consent with the highest standard for independent proof of consent. Whether you’re a lead buyer, seller, or generator, staying informed and compliant is non-negotiable.

Help keep your business aligned with the latest FTC regulations with the power of TrustedForm.

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