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 The law was originally enacted by Congress in 1991 as the first step towards taming the growing number of unwanted calls to consumers.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.