TSR Disclosure Requirements

Since it was enacted in 1995, the Telemarketing Sales Rule (TSR) has given the Federal Trade Commission (FTC) and state Attorneys General the power to crack down on fraudulent telemarketing and protect consumer privacy.  Any business or individual that uses telemarketing must comply with the law.  One of the significant elements in the TSR is the requirement to disclose certain information during a call. In this article, we’ll detail the TSR disclosure requirements.

Required Disclosures at the Beginning of Outbound Sales Calls

The TSR requires telemarketers making outbound sales calls to promptly and clearly disclose certain information before making a sales pitch. The following information needs to be included in your telemarketing scripts:

• The identity of the seller, which is the entity that the call is made on behalf of. If the seller commonly uses a “Doing Business As” name that is registered with the appropriate state authorities, it can use that name instead of its legal name.
• The caller must promptly disclose that the call is a sales call.
• A brief description of the items you are offering for sale must be given.
• If a prize promotion doesn’t require purchase or payment to participate or win. If the consumer asks, the caller must immediately disclose instructions on how to enter the prize promotion without paying any money or purchasing any goods or services.

Disclosure Requirements Before Payment

Before a transaction is completed, the following information must be provided to the consumer.

• Sellers and telemarketers must disclose the total cost to buy, receive, or use the goods or services being sold.
• Sellers and telemarketers must disclose all material restrictions, limitations, or conditions to purchase, receive, or use goods or services that they are offering to the consumer. A material restriction, limitation, or condition is one that would likely impact the consumer’s decision to purchase the goods or services offered. Examples include:
  • A credit card offer that requires the consumer to make a deposit before receiving and using the card.
  • A vacation package that blacks out certain periods of time.

Sellers and telemarketers may disclose material restrictions, limitations, or conditions orally or in writing, as long as the information is clear and conspicuous and disclosed before the consumer pays.

• If the seller has a no-refund policy, it needs to be made clear to the consumer before payment.
• When offering a prize, consumers must be made aware of:
• The odds of winning
• If they can participate without making a purchase
• How consumers can enter the prize promotion without making a purchase
• Any costs or conditions to receive or redeem a prize

Disclosures for Charity Calls

When calling on behalf of a charity, the following disclosures must be promptly made:

• The charitable organization the solicitation call is on behalf of. 
• That the purpose of the call is to solicit a charitable contribution. 

CompliancePoint has a team of marketing compliance experts that can help your business comply with the TSR, TCPA, Do Not Call lists, and all state telemarketing laws. Contact us at connect@compliancepoint.com to learn more about our services.