Many people receive telephone solicitations at their home. While many telephone sales calls are made on behalf of legitimate companies offering bona fide goods and services, sometimes pitches to purchase goods or services are deceptive. Telemarketing fraud is a multi-billion dollar drain on consumers each year causing thousands of consumers to lose from a few dollars to their whole life savings. Consumers should be skeptical when receiving a "cold call" from a telemarketer pushing a good or service.
Consumers should be wary if promised free gifts, prizes, vacations, or the "investment of a lifetime" only if the consumer acts "right away." Do not be pressured into making a decision on the spot. Ask questions and get the answers needed to make a decision to purchase something, especially before giving any personal account information over the phone. If a consumer hears some of the following or similar statements from a telephone salesman, they may be the target of telemarketing fraud, so just say "no thank you" and hang up:
The Federal Trade Commission's Telemarketing Sales Rule and a similar Tennessee law were designed to protect consumers from fraud by requiring certain disclosures and prohibiting certain misrepresentations from telephone solicitors. The Rule covers most types of telemarketing calls, including calls to sell goods, services, prize promotions, "sweepstakes," investment opportunities, and even calls that consumers make to companies in response to postcards or other direct mail solicitations. Some important aspects of the Rule are as follows:
Consumers do not have to pay for credit repair or advance-fee loan/credit services until these services have actually been delivered to the consumer.
Remember that it is very difficult for a victim of a telemarketing scam to get money back. To avoid being a victim over the phone, remember to make wise decisions and think carefully about paying money over the phone for goods or services. A consumer may want to check out a company if they do not recognize the name. Check to see if the company has any complaints filed against it by checking the Tennessee Division of Consumer Affairs website or by calling DCA at (615) 741-4737 (or toll free in Tennessee at 1-800-342-8385), or the National Fraud Information Center. Once a consumer has checked out the company, the consumer may want to discuss the offer with a trusted family member, friend, or financial advisor and take their time making a decision whether or not to spend their money. Keep in mind that any personal or financial information that is given to a telemarketing company may be sold to other companies that may also make future offers.
Schemes that Target the Elderly: Elderly persons are often targeted by deceptive telemarketers. This is based on the theory that older people are more polite and trusting of strangers. Some telemarketers may prey on a lonely, elderly person living alone by befriending the consumer before convincing him/her to buy something. In Tennessee if a telemarketer knowingly targets the elderly civil penalties under the Tennessee Consumer Protection Act are increased to $10,000.00 per violation.
Consumers who would rather not receive telemarketing sales calls can have their telephone number removed from eligible calling lists by registering with the Tennessee Do Not Call Program (by phone at 1-877-872-7030) and the National Do-Not-Call Registry (by phone at 1-888-382-1222). If a particular company calls repeatedly, ask them to remove the telephone number from the company's internal call list and any future calls from the company are in violation of the law.
Consumers who feel that a telemarketing company is violating the law can file a complaint through the Tennessee Regulatory Authority website or by phone at 1-800-342-8359 or through the Federal Trade Commission website or by phone at 1-877-FTC-HELP (1-877-382-4357).
Investments: People lose millions of dollars to "get rich quick" schemes that promise high returns with little or no risk. These generally worthless investments can include gemstones, rare coins, oil and gas leases, precious metals, art, real estate and other "investment opportunities."
Prize offers: Consumers usually have to do something to get the "free" prize--attend a sales presentation, buy something, or give out a credit card number. Often these "prizes" are worthless or greatly overvalued.
Travel packages: "Free" or "low-cost" vacations can end up never happening, involve substandard transportation or accommodations, or have hidden costs. Consumers may pay for some part of the package, like airfare or hotel, at rates much higher than could have been found on the Internet or through a travel agent. The "free" or "low-cost" vacation may cost many times more than what the consumer would otherwise pay or what they were led to believe.
Charities: Some telemarketers may attempt to deceive the consumer by using phony names of charities that sound like better-known, reputable organizations. These telemarketers often use high-pressure tactics and may not give out relevant information, such as the address or phone number of the charity. If there are any doubts, call the charity headquarters or a local branch directly.
Vitamins and other health products: A sales pitch including a "free prize" may be used to entice consumers to pay hundreds of dollars for products that are worth very little.
Recovery scams: If a consumer loses money in a deceptive telemarketing scheme, chances are that the consumer may get another phone call from someone promising to recover the lost money for a fee. Even law enforcement officials cannot promise to recover money, so do not lose more money to a "recovery specialist."