FTC Upholds the National Do Not Call Registry

The FTC further strengthened the Telemarketing Sales Rule (TSR) with the case brought against Credit Foundation of America, Inc. (CFA).  Though CFA claimed to be exempt from following the TSR, or more specifically, adhering to the National Do Not Call Registry, the court and the FTC agreed that the TSR was applicable to CFA.

Because CFA mainly generates income for for-profit companies, the FTC said that regardless of their tax-exempt status with the IRS, CFA is bound under the FTC’s jurisdiction. 

The main issues with CFA arise from how they handled their solicitations.  CFA used a nationwide automated telemarketing message to reach an enormous number of consumers on a weekly basis, regardless of whether the individuals were on the Do Not Call registry, and regardless of whether they requested to be put on the in-house  Do Not Call list.  Then, in addition to this, CFA made false claims to consumers.  CFA used the automated message system to communicate to consumers that CFA was a debt management program that has prescreened the individual and would like to offer them the ability to lower their interest dramatically regardless of the debt.

As points out, this behavior is very dangerous Lydia Parnes, Director of the FTC's Bureau of Consumer Protection.  Debt management is at it’s best when it is tailored to meet the needs of each different individual.  ■