New FCC Telemarketing Rules and the $1,500 Phone Call

published in Corporate Counsel | October 16, 2013

For businesses that utilize telemarketing calls and text messages as part of their promotional and business development efforts, the Federal Communications Commission’s new regulations enforcing the Telephone Consumer Protection Act (TCPA) will have a significant impact on how they market their products and services. The new FCC regs, which went into effect October 16, 2013, specifically prohibit businesses from making a telephone call (or sending a text message) that includes an advertisement or constitutes telemarketing using an automatic telephone dialing system or an artificial or prerecorded voice other than a call made with the “prior express written consent” (PEWC) of the called party.

McAfee & Taft attorney Michael Smith was interviewed by Corporate Counsel reporter Rebekah Mintzer about how the new rules significantly change the legal landscape of telemarketing in the United States. Not only do the new regs require businesses to obtain express written consent from consumers before engaging in automated telemarketing and texting, they do not provide an exemption for existing customers who may already be receiving such messages.

“There’s no grandfathering in of prior consent,” he said. As a result, Smith is advising companies to purge their existing databases and build them from scratch, obtaining consumer consent using the new FCC procedures and legal disclosures.

The new FCC regulations impose penalties of up to $500 per illegal telemarketing call made as a result of negligence, and $1,500 per call for any willful violation.

You can read more about the new regulations in the October 15, 2013, McAfee & Taft Business Law Alert.