Using the Telephone Wisely
Prepared to educate consumers on their
rights, responsibilities and the benefits of doing business
by phone.
Many innocent consumers are victims of telephone
fraud each year. You could be too, if you don't know the
basic guidelines of doing business on the phone.
A survey conducted by the National Fraud Information Center
(NFIC), a project of the National Consumers League, indicates
that scam artists target those least able to afford the loss
or resist their pitch (the very young, the very old, the
disabled, those living on fixed incomes and those with a
poor command of the English language). Of course, anyone
can become a victim of telephone fraud.
The American Teleservices Association (ATA), a not-for-profit
trade association, is dedicated to high ethical standards
among its members and has made a strong commitment to protecting
the rights of consumers. The ATA is as anxious to stamp out
telephone swindlers as you are - maybe more so - as they
undermine the credibility of legitimate telemarketers and
hurt their business. This brochure was created to educate
you about the ethical standards of telephone marketing and
how to spot, stop and report telephone scams.
Telemarketing and telephone fraud are not the same
There was a time when all a company had to do was advertise
to get business. Not any more. Competition intensified on
a global scale, and the process of reaching consumers and
meeting their demands became so complex that new technologies
were required.
Enter the telephone, which, over the past quarter of a
century, has emerged as a significant marketing tool used
by "Fortune
500" companies and small businesses alike. The telephone
is both efficient and cost-effective. It instantly links
consumers to goods, services and information, and it can
be applied to everything from order-taking and account management
to fundraising and responding to inquiries about merchandise
and services.
Telemarketing is also a rapidly growing alternative to
traditional retail shopping. Calls can be placed by the consumer
(inbound), or by a telemarketer to your residence or business
(outbound). Another prime benefit of telemarketing is customer
relations. A phone call takes less time than a face-to-face
sales call, phone calls can be made more regularly and frequently
and you can get a much faster response to your questions
or problems. Telephone fraud, on the other hand, involves
unfair and deceptive trade practices and high-pressure sales
pitches.
Telephone shopping is here to stay
People everywhere rely on the convenience of the telephone
to meet their individual needs. An estimated 185 million
Americans purchase goods or services by phone each year.
Toll-free numbers are used to make purchases, ask questions,
compare prices or arrange delivery and service. The telephone
is also used to trace bank transactions, find out your
loan or credit card balances and make your travel reservations.
One may receive calls from insurance companies, publishers,
political parties, charities, pollsters and a host of others,
both known and unknown to you.
The Basics of Doing Business by Phone
1. Be sure the calling party is legitimate.
Reputable telemarketers will answer your questions about
their organization, their product/service, the terms of
the offer and the price. Don't hesitate to ask them to
call back after you've had time to check them out through
the Better Business Bureau (BBB), your state attorney general's
office or your local consumer protection office (look in
the telephone book under city, county or state government).
2. If you still have doubts, contact the National
Fraud Information Center's (NFIC) Fraud Hotline: 800/876-7060
or website: www.fraud.org. To
combat the growing menace of fraud and improve regulation,
prevention and enforcement, the NFIC provides information
on how to identify possible fraud and directs your complaint
to the appropriate federal regulatory agency. The Center
is also the source of good advice for older Americans and
others who need someone to talk to when they are contacted
about "fabulous" offers and "irresistible" opportunities.
Spanish-speaking counselors are also available for the
convenience of the Hispanic population.
3. Understand the offer being made and the terms
and conditions of sale. Don't be afraid to ask
questions, and make sure you keep a record of the following
information before agreeing to the purchase:
The caller's name, the name and address or phone number
of the individual, business or other entity on whose
behalf the call was made, and the date of the order.
The total price of the item(s) or services(s), including
taxes, delivery charges and the expiration date of the
offer.
The delivery date, and the guarantee, return and cancellation
policies. For items to be delivered over time and billed
periodically, find out the total purchase price and delivery
dates.
4. Learn to say "no" to offers that
sound too good to be true. They usually are.
For example, be wary if you're told you've won a prize
but have to buy something, pay a fee or prepay taxes
to receive it. While some legitimate offers may have
a time limit, be careful of high-pressure telephone solicitors
who demand that you "send your money today
or the deal is off."
Offers must be stated clearly and honestly, so that you
know exactly what you have committed to and what you will
be getting in return before you place your order. If you
do send money, make it a check or money order - never send
cash!
5. Do not give out personal information - your bank's name,
your checking account number, your credit card number and
expiration date, or your social security number - until you
are sure you're dealing with a reputable organization.
Scam artists can use this information to debit your checking
account or charge unauthorized purchases to your credit
card. The Telemarketing Sales Rule permits the use of "demand
drafts" and "checking account debits" only
after the consumer has verified the purchase on tape or
in writing.
The solution is consumer empowerment
The way to shut down telephone fraud is to shop wisely
and report your loss or any suspicious call to the proper
authorities as soon as possible. Once you've been the victim
of a telemarketing scam, you're branded as an "easy target" and
will be called again and again. Scam artists count on their
victims being too embarrassed about being conned to report
it. Unfortunately, even if you do report it, the changes
of getting your money back are slim. When law enforcement
agents get close to apprehending fraudulent telemarketers,
they change their names and scams and start over again somewhere
else.
With the passage of the Telephone Consumer Protection Act
(TCPA) of 1991 and the Telemarketing and Consumer Fraud
and Abuse Prevention Act of 1994 (Telemarketing Sales Rule),
Congress safeguarded the rights of consumers and gave state
and federal law enforcement agencies more power to track
down and prosecute scam operators. The ATA supports these
two laws, regulated by the Federal Communications Commission
(FCC) and the Federal Trace Commission (FTC) respectively,
which require telemarketers to:
1. Promptly state in a clear and conspicuous manner their
name, the individual business or other entity on whose
behalf the call is being placed, that the purpose of the
call is to sell a good or service, and a method for recontacting
the seller (address and/or phone number) in case you want
to cancel the order or lodge a complaint.
2. If the caller represents a product or service that
you are sure you will never want or need - or you don't
want to be contacted by phone - just say: "Put me on your
'do not call list.' Under the TCPA and the Telemarketing
Sales Rule, these 'do not call" lists of people who
do not wish to be contacted again must be maintained by the
company whose goods and services are being offered, and a
written policy to this effect must be available upon demand.
Failure to do so or to properly maintain a "do not call" list
can result in legal actions and severe penalties.
3. Both the TCPA and the Telemarketing Sales Rule expressly
forbid calls to private residences before 8:00 a.m. or after
9:00 p.m. in the local time zone of the person being called,
and any exception must be with the express consent of the
called party. State laws may also vary.
4. The TCPA and the Telemarketing Sales Rule require
that all telephone service representatives be thoroughly
trained on "do not call" procedure or other guidelines.
Any violations of the TCPA regulations should be submitted
in writing to the FCC. Any violations of the Telemarketing
Sales Rule should be submitted in writing to the FTC
or your state attorney general. (See addresses of the FCC
and FTC on the back of this brochure.) Keep detailed
records so that you can provide accurate information when
filing a complaint.
Industry and the consumer - a winning partnership
Telephone fraud is an easily preventable crime. Alert, educated
consumers are the best weapons to fight it. To that end,
the ATA, as a member of the National Consumers League's Alliance
Against Fraud in Telemarketing, a founding member of the
FTC Partnership on Consumer Education (for the Telemarketing
Sales Rule), strongly encourages you to report any violations
or telephone fraud incidents to the NFIC Hotline or the FTC
at telephone numbers listed on the back of this brochure.
Answers to Commonly Asked Questions
How can I tell a legitimate offer from
a fraudulent one?
Some indicators of a potential telephone
scam are:
• high pressure tactics,
• refusal to provide a name and address or phone number
for verification,
• the offer of a valuable prize,
• a request for a credit card number without your agreement
to buy, or
• an unrealistically low price for the product or service.
What if I don't want to receive any telemarketing calls from
a company?
Under the TCPA and the Telemarketing Sales Rule, you have
the right to ask to be put on the caller's "do not call" list.
You can also send your name, address and telephone number(s)
to the Telephone Preference Service, c/o the Direct Marketing
Association, P.O. Box 9014, Farmingdale, NY 11735-9014.
Companies subscribing to this service receive a list of people
who do not want to receive telemarketing calls and then remove
these phone numbers from their calling lists.
What if I'm not satisfied with the product or service I
ordered by phone?
Before making the purchase, check out the return policy.
Under the Telemarketing Sales Rule, telemarketers must
inform customers when there is a "no return" policy.
Legitimate companies want your business and will be happy
to resolve your complaint. If you are not satisfied with
the resolution of your complaint, and you purchased by
credit card, write to the credit card company and stop
payment within 60 days of purchase. (See the back of your
credit card statement for guidance on problems with credit
card purchases).
If you need further assistance, contact
your local Better Business Bureau, the National Fraud Information
Center, your state attorney general, or your local consumer
protection office and file a formal complaint. (To locate
your local consumer protection office, check for the consumer
affairs department under your city, county, or state government
listings in your telephone book).
If you feel a telemarketing call is being handled rudely
or inappropriately, ask to speak to a supervisor. If you
are refused, ask for the company's name and phone number
and call back. A reputable firm will wish to correct the
problem.
If you have any questions that have not been covered in
these guidelines, please contact any or all of the following:
American Teleservices Association
1620 I Street NW. Suite 615.
Washington, DC 20006
1-877-779-3974
www.ataconnect.org
National Fraud Information Center
c/o National Consumers League
P.O. Box 65868
Washington, DC 20035
1-800-876-7060
www.fraud.org
Federal Trade Commission
6th & Pennsylvania Avenue, NW
Washington, DC 20580
1-877-FTC-HELP, 202-382-4357
www.ftc.gov
Federal Communications Commissions
1919 M Street, NW
Washington, DC 20554
1-888-225-5322
www.fcc.gov
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