The FCC to Tackle Lead Generation

In its ongoing battle to eliminate junk calls and texts, the FCC is considering new rules that would close down the practice of lead generation that tries to bypass Do Not Call restrictions. Current industry practices have found loopholes to avoid violating the letter of the FCC rules.

Lead generation is the source of a lot of spam and robocalls. A consumer will go to a website, such as an insurance company, and in order to get a free quote, the consumer will agree that the insurance company can share information for purposes of marketing with its ‘partners’. The partner companies, which likely paid the insurance company for the sales leads, can then claim that they have permission from the consumer to call or text them, thus avoiding the FCC’s Do Not Call restrictions.

In real-life practice, companies are not only sharing information with closely allied companies, but with any company willing to buy the referral. The sharing of lead generation materials has grown to become big business, and, in one example cited by the FCC, a  company was sharing customer calling information with 5,000 ‘marketing partners.’

The FCC’s proposed rules are aimed at strengthening the rules established by the Telephone Consumer Protection Act (TCPA). The law was originally enacted by Congress in 1991 as the first step towards taming the growing number of unwanted calls to consumers. The Act limited the use of pre-recorded voice messages, auto-dialers, and automated texts. The Act said that anybody calling a consumer must have explicit customer consent. The Act also created the national Do Not Call Registry for people to declare they don’t want unsolicited calls.

The FCC plans to solicit comments on its proposal to tighten the rules. The FCC is considering only allowing lead generating referrals with partners that are logically and topically associated with the website. The FCC also wants any company that will make referrals to prominently display the identity of all marketing partners on the web page where consent is being requested.

The new FCC rules would create a huge shift for companies that use such referrals to bypass the Do Not Call rules. Many businesses that primarily sell by telephone or text calls say that enforcing the new rules would put them out of business. The practice of obtaining referrals through other companies is also widely used in the non-profit world.

It’s taken the FCC far too long to do this, and marketing referrals have been widely used for years to ignore the Do Not Call rules. I’ve been on the Do Not Call list for over twenty years, and I still receive a lot of junk calls and junk texts.

Twenty-eight State Attorney Generals have asked the FCC to tighten these rules. This issue is also being considered by the Federal Trade Commission related to its Dot Com Disclosure rules. There are also several lawsuits in federal courts taking on companies that violate the TCPA rules.

2 thoughts on “The FCC to Tackle Lead Generation

  1. Dear Doug:
    Great to see you a few months ago!!
    The way the Do-Not-Call legislation was written left a couple of gaping loop holes wide enough to proverbially drive a Mack Truck through.
    While people signing up for Do-Not-Call expected to be freed from the scourge of robocalls, telemarketing sales calls and other nuisance calls, the reality is that the calls still come in.

    The wording that allows these knuckle heads to call is that they can call those with whom the seller/caller has had a previous (business) relationship. That is the language that needs to be tightened up.

    If you weather the initial message long enough, some calls give you the option to “opt out” from the caller’s message. In doing so, this also alerts the system that your phone number is a legit number. (I.B., I wonder if that calling network then sells the list of legit phone numbers to others? The cynical side of me supposes they do.)
    Telling the live operator to take you off their list is also supposed to get you removed. Often, it only begets a hang-up, swear language from the caller (happened to me twice!), or a plea to re-consider their spiel. GRRR!!

    Significantly, the Do-Not-Call legislation also only applies to domestic calls. My own guess is that true bad actors only moved their operations out-of-country.

    Lastly, the legislation also does not affect political candidate calls. GRRR!!

    ~ Ron

  2. P.S. Junk calls will continue to be a problem so long as there is no incentive to remove people from these lists.

    A few years ago, I solved my business-reply mailing scourge in about six months, at least in my own case, by mailing back the business-reply envelopes with my request to remove me from their list. Included in these envelopes were a bunch of inserts and envelopes — theirs and others. Since any business-reply envelopes received by the sellers are expensive, this gives them “weighted incentive” to remove me from their mailing lists.

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