FTC amends the TSR on recordkeeping and prohibiting misrepresentations

Agency Rule-Making & Guidance FTC TSR Recordkeeping

On April 16, the FTC issued a final rule amending the Telemarketing Sales Rule (TSR) to add requirements for telemarketers to maintain transaction records, prohibit misrepresentations, and add a new definition for “previous donor” in the context of robocalls on behalf of charitable organizations. This will be the fifth time the TSR has been amended since its enactment in 1995, with previous amendments creating the National Do Not Call Registry in 2003, prohibiting sellers to use prerecorded messages (i.e., robocalls) in 2008, banning debt relief services from requiring an advance fee in 2010, and most recently, barring certain payment mechanisms used in fraudulent transactions in 2015. The FTC’s new amendments to the TSR will require telemarketers to retain a copy of each prerecorded message, call detail records, records to show an established business relationship, records on charitable donations and the do-not-call registry. On the rule’s efforts to prohibit misrepresentations, marketers will be prohibited from making misrepresentations about the good or service they are selling or false statements to induce a charitable contribution. The final rule also will update the definition of “previous donor” to allow telemarketers to place robocalls on behalf of a charity only to customers who have donated to a charity within the previous two years. The amendment will go into effect on May 16 with mandatory compliance beginning October 16.