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Lead Generation Industry Must Take Notice Of FTC Settlement with Ameriquest

On October 7, 2007 the FTC announced six settlements with companies and individuals accused of violating the requirements of the National Do Not Call Registry.

On October 7, 2007 the FTC announced six settlements with companies and individuals accused of violating the requirements of the National Do Not Call Registry. One of the settlements was with Ameriquest Mortgage Company who allegedly made improper calls to consumers on the Registry whose numbers had been obtained from third-party lead generators. The lead generators enticed consumers to provide their contact information, including phone numbers, using Web sites that offered information on financial and other products. The FTC's complaint states that because consumers whose numbers were on the lead lists were not reaching out to Ameriquest in particular, the company had not developed an "established business relationship" with them, making calls to registered numbers illegal. Ameriquest also allegedly also ignored consumers' requests to be placed on its entity-specific do not call list.

The settlement with Ameriquest requires them to pay a $1 million civil penalty and requires them not to make an outbound telephone call to a person's number on the Registry if the phone number was acquired from a lead generator unless Ameriquest can prove that such lead generator, within 3 months immediately preceding the date of the telemarketing call:
1. informed the person, clearly and conspicuously before the person has disclosed to the lead generator the person's telephone number or any other information that would allow the person to be contacted by telephone, that the person may receive telephone calls if the person responds to the lead generator; and
2. informed the person, clearly and conspicuously before the person has disclosed to the lead generator the person's telephone number or any other information that would allow the person to be contacted by telephone, of the maximum number of sellers who may call, or on whose behalf a telemarketer may call, if the person responds to the lead generator; and
3. if possible, informed the person, clearly and conspicuously before the lead generator releases to Defendant or its representatives information that specifically identifies the person, the identity of the sellers who may call, or on whose behalf a telemarketer may call, and the number of identities disclosed does not exceed the maximum number stated in number two above.

Impact on the Lead Generation Industry

Over the past few years lead generation has seen significant growth. Although Ameriquest is the only company that is legal bound by the settlement, the lead generation industry needs to understand that the settlement is a clear indication of the FTC's position on what disclosures must be made to consumers in order avoid violations of the DNC law.

Companies that buy leads for telemarketing purposes need to ensure that the lead generators it acquires leads from provide appropriate disclosures. Similarly, lead generation companies need to ensure appropriate disclosures are made before the leads are acquired in order for the company(s) that buy the leads to remain complaint with the DNC law.

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