May 15, 2017
Last month, Indiana Governor Eric Holcomb signed into law a telemarketing statute that will significantly affect the way in which telemarketers conduct business within the State.
What are the major changes to telemarketing practices mandated by the new telemarketing statute?
The newly-enacted Indiana telemarketing statute broadly amends the State’s telemarketing regulations in three categories:
Disclosures:
- The regulations mandate more fulsome disclosures by telemarketing operators. Specifically, at the outset of telemarketing calls, each individual telemarketer will have to provide Indiana consumers with his/her first and last name, the identity of his or her employer or the entity with which s/he has contracted, and the name of the business on whose behalf the call is being made;
Liability:
- The statute extends liability beyond the corporate entity responsible for placing the call by amending the definition of “caller” to include officers of a corporate entity that are either involved in the conduct or otherwise have notice of it and fail to take steps to prevent it. As a result, liability under the new law extends to both individuals and entities, including affiliates, that have direct or indirect control over the telephone solicitor. Such individuals or affiliated entities may ultimately escape liability if they are able to demonstrate that they did not know of the subject violation.
Penalties:
- The law treats noncompliance as a deceptive act, in which the telemarketer may be subject to a fine of up to $10,000 for the first offense and up to $25,000 for each subsequent offense.
The mandates of the new telemarketing statute are set to take effect on July 1, 2017.
Protect Your Business Against Telemarketing-Related Liability
We have written extensively about increased interest, from regulators and class action attorneys alike, in the telemarketing industry. Indiana already rigorously enforces its telemarketing statute. The State’s broad effort to further regulate telemarketing calls to its residents is very likely to have a wide-ranging impact on those operating in the State. This should serve to reinforce the notion that, in today’s regulatory environment, it is imperative to have telemarketing practices and procedures examined by experienced counsel to avoid potentially disastrous consequences if a class action plaintiff, or a state or federal regulator brings a lawsuit or initiates an investigation for alleged telemarketing-related violations.
If you are interested in learning more about this topic, need to review your telemarketing practices and procedures or if you are facing an investigation from the FCC or other regulatory agency, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.
The material contained herein is provided for information purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney. Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.
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