Alert August 11, 2009

FTC Proposes Amendments to Telemarketing Sales Rule

The FTC issued a Notice of Proposed Rulemaking to amend its Telemarketing Sales Rule to address the sale of debt relief services (e.g., credit counseling, debt settlement and debt negotiation services). The proposal would, among other things, (1) define the term “debt relief service”; (2) ensure that telemarketing transactions involving debt relief services are subject to the Telemarketing Sales Rule, regardless of the medium through which such services are initially advertised; (3) mandate certain disclosures and prohibit misrepresentations in the telemarketing of debt relief services; and (4) prohibit any person from requesting or receiving payment for debt relief services until the services have been fully performed and documented to the consumer. Comments on the proposal are due by October 9, 2009. Click here for a copy of the proposal.