Protecting Yourself from Telephone Marketing Fraud
Telemarketers often use illegal and deceptive practices such as contests, free prizes, sweepstakes, fake charities and other tricks to seduce older Iowans out of their hard-earned savings. Examples of high pressure sales and suspicious offers include:
- An offer that sounds too good to be true.
- Demands that you "act right now".
- Requests for your credit card number or bank account number, especially for "identification" or to "confirm you have won a prize".
- The caller's refusal to mail you information about their organization.
- Demands that payment be made with cash, check, or by giving your bank account number.
- Claims that you have won a prize.
- Offers for "Credit Card Loss Protection".
- Offers for "Advance Fee Loans" where you're asked to pay fees before you get a loan.
Federal and Iowa Protections Against Telemarketers. Several Federal and State of Iowa laws and rules help protect against telemarketers and deceptive practices:
- The "National Do Not Call Registry." This 2003 Federal Trade Commission rule allows you to sign up for a free registry that prevents most telemarketers from even calling. You can register online at www.donotcall.gov or call toll free to 1-888-382-1222 from the telephone number you want to register. The registry stops most telemarketing calls. It does not stop calls from charities, political organizations and telephone surveys. It also does not stop calls from companies you already do business with or have made inquiries to.
- Caller ID. Beginning in January 2004, a telemarketer's telephone number (and name if possible) must show on your caller ID service. This will help you recognize when a telemarketer is calling.
- Other Legal Protections. If you are not on the National Do Not Call Registry and get calls from a telemarketer, other Iowa and Federal Trade Commission rules can protect you:
If you tell a telemarketer not to call again, they cannot call you back. If they do, you can sue to stop the calls and may be able to get penalties of $500 or more. Even if you don't tell them to stop calling, a telemarketer cannot repeatedly or continuously call you.
- A telemarketer cannot call you before 8:00 a.m. or after 9:00 p.m.
- A telemarketer must disclose that the call is to sell something, who the seller is and what they are selling before they start their sales pitch. If they are offering a prize or sweepstakes promotion, they must tell you that no purchase or payment is necessary to win.
- A telemarketer cannot misrepresent any information about the product or service offered or the nature of the prize in any prize or sweepstakes promotion. If they are selling an investment, they cannot misrepresent the earnings potential, profitability, risk or liquidity.
- A telemarketer cannot use threats, intimidation or profanity.
- A telemarketer must accurately disclose all material information relating to the sale, including the total costs involved, any restrictions on getting or using the product or services, their refund or exchange policies, the odds of getting a promotional prize and the costs or conditions of receiving a prize.
- A telemarketer cannot access your bank account without your express authorization, which must either be in writing or tape-recorded.
Note that not all calls are covered by these rules. For example, catalog sales, and certain calls initiated by you are not covered.
Unfortunately, these rules do not stop all telemarketers from acting illegally. Many are paid a large commission on sales and tend to ignore the rules. The best way to avoid problems is to never agree to buy anything over the telephone. Instead of wasting your time listening to a sales pitch, just say "No Thank You" and hang up! Better yet, sign up for the National Do Not Call Registry. This will help prevent calls in the first place.
There may also be other state and federal telemarketing laws that affect your rights and obligations. If you are over 60, you may call the Legal Hotline for Older Iowans at 1-800-992-8161 with questions about the National Do Not Call Registry and telephone marketing fraud.