FTC hikes fines FCC hikes fees

Effective August 1, 2016, the FTC raised its civil penalty from $16,000 to a staggering $40,000.  This is a per violation penalty, and adds up quickly.  Among other violations, the new fine applies to any violation of its Telemarketing Sales Rule, or any other act which it defines as an “unfair or deceptive act or practice.”  Therefore, the new fine may be applied to online, email and other marketers – not just telemarketers.  Prior to February of 2009, the penalty was $11,000.  Since February of 2009, the fine had been $16,000.  Violations that can trigger the new $40,000 fine include, for example:

  • Calling numbers on the National DNC list without consent or an established business relationship;
  • Robocalling consumers without consent;
  • Failing to honor an opt-out;
  • Making a material sales misrepresentation; and
  • Making product claims that lack substantiation;

The FCC announced that effective October 1, 2016, its fees for accessing the national Do-Not-Call database will be increased to $61 per area code, or $16,714 for the entire nation. The fee for accessing an additional area code for a half year will remain at just $30.  Remember that sellers must obtain a subscription account number (“SAN”) and purchase all area codes into which they will call, unless they have an exemption such as well-documented written consent or an established business relationship.  Non-telemarketing calls are not subject to the consumer DNC list, but use caution because “telemarketing” is defined broadly.