FTC Offers New Protections From Telemarketers

Consumers tired of those pesky telemarketers that always seem to call just when the family's sitting down to dinner may soon have a way to quiet the solicitor's ring.

Regulators at the Federal Trade Commission on Wednesday announced plans for a national "do-not-call" registry consumers can sign up for to make sure their phones don't ring with any more sales pitches.

Under the new rules, telemarketers also must transmit identifying information that can be viewed by services like Caller ID and limit the number of calls that hang up or leave people listening to dead air on the line.

"Time with family is a precious commodity, and families should be given the tools they need to help prevent unwanted calls from telemarketers," White House press secretary Ari Fleischer said in response to Wednesday's decision. 

"The president commends the Federal Trade Commission for voting to create a national do-not-call registry to allow consumers the option to stop unwanted telephone solicitations," he said. 

The registry would give people the chance to stop sales calls made from outside their state. Consumers who register on the Internet or via a toll-free number would stay on the list for five years before having to renew.

FTC officials said the agency is now taking bids from companies who want to create the registry, first proposed in January.

Once the list is up and running, telemarketers will have to check it every three months to find out who doesn't want to be called. Telemarketers who call listed people could be fined up to $11,000 for each violation.

The registry will likely cost about $16 million in its first year and would be paid for with fees collected from telemarketers, FTC officials said. The agency still needs congressional approval to collect the fees.

But the registry is getting some heat from groups and businesses whose livelihood rests on cold-calling consumers with sales pitches.

Louis Mastria, a spokesman for the Direct Marketing Association, which represents telemarketers, said the new rules are unlawful. The DMA is even going so far as to consider taking the FTC to court. Mastria said the do-not-call list endangers the jobs of some of the industry's 4 million workers, many of them single parents and students.

"In this soft economy, you have to step back and think twice about doing this," he said.

But Rep. Edward Markey, D-Mass., praised the idea, saying it "will provide consumers with a powerful new tool.''

"Hopefully by this time next year the only thing consumers will hear ringing during supper will be sleigh bells or jingle bells and not the jangling phone,'' said Markey, the top Democrat on the House Commerce Telecommunications and Internet Subcommittee.

There are exceptions to the do-not-call protections, however.

For instance, a company can, in fact, call someone on the list if that person has bought, leased or rented something from that specific seller within the past 18 months. Telemarketers also can call consumers if they have asked or applied for something during the last three months.

The FTC also has only limited authority to crack down on certain industries — such as telephone companies — that fall under the jurisdiction of the Federal Communications Commission. The FCC is considering its own do-not-call registry.

The two agencies would have to work together to cover all telemarketers unless Congress decides one should have more power than the other when it comes to going after telemarketers.

Charities are also exempt from the FTC's do-not-call list, but third-party telemarketers who call on their behalf must play by the rules. That means they can't call consumers on the do-not-call list.

Another new restriction on telemarketers involves machines called predictive dialers. The machines dial numbers stored in a database and predict when a telemarketer will be ready to finish one sales call and start another. When the machine reaches a possible customer, the call is transferred to a telemarketer who is just finishing another call.

But the system isn't foolproof and calls are often made before a telemarketer is available.

When these "abandoned'' calls happen, consumers who pick up the phone either get disconnected or greeted with a long silence before the sales pitch begins. The long silence is usually the key to consumers knowing they are about to be solicited and often leads to many hanging up the phone.

The new rules limit abandoning to less than 3 percent of a telemarketer's business, agency officials said. The FTC also is requiring sellers to play an identifying recording after two seconds if no operator is available to start talking.

The guidelines also prohibit telemarketers from charging someone without permission, especially when the seller already knows the person's billing information.

The Associated Press contributed to this report.