The Federal Trade Commission has adopted amendments to its Telemarketing Sales Rule ("TSR") that will extend the Rule's coverage to "inbound" telemarketing calls made by consumers in response to advertisements or direct mail solicitations for technical support services.
So far this year, consumers have reported losing more than $165 million to tech support scams, which, according to the FTC, use pop-up alerts and other deceptive tactics to falsely communicate to consumers that their devices are infected with malware or other problems in order to sell them bogus support services. These scams often convince consumers to make nonreversible payments for such "services," including via money transfer apps, wires and prepaid cards.
According to the FTC's statement of basis and purpose, the final rule addresses the harm associated with telemarketing these products and services by adding "technical support services"—defined as "any plan, program, software, or service that is marketed to repair, maintain, or improve the performance or security of any device on which code can be downloaded, installed, run, or otherwise used, such as a computer, smartphone, tablet, or smart home product, including any software or application run on such a device"—to the categories of calls excluded from the TSR's exemptions for inbound calls made "in response to an advertisement through any medium, as well as those made in response to direct mail solicitation including email."
As background, the Rule exempts from its coverage certain calls that consumers make to telemarketers that are (i) not the result of any solicitation, (ii) in response to certain advertisements and (iii) in response to a direct mail solicitation that contains certain information. However, the exemptions for inbound calls contain exclusions for certain types of calls that are often deceptive, such as inbound calls relating to investment opportunities, debt relief services and prize promotions. The recent amendments add tech support services to such exclusions.
The FTC sought public comment on the proposed amendments in April 2024 and received 25 comments from a variety of interested parties. After considering the entire record, the Commission decided to adopt, with one modification, the amendments, which will become effective 60 days after their publication in the Federal Register.
The Commission voted 4-1 to approve the final rule, with Commissioner Andrew Ferguson voting no, "not because it is bad policy, but because the time for rulemaking by the Biden-Harris FTC is over," according to his dissenting statement.
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