FTC Cracks Down On "Do Not Call" Abuse

phone generic telephone FTC Federal Trade Commission CBS/AP

Federal regulators on Wednesday announced nearly $7.7 million in settlements with six companies - including Craftmatic Industries and ADT Security Services - accused of calling people on the national Do Not Call list.

The Federal Trade Commission said Craftmatic, maker of adjustable beds, would pay the biggest fine - $4.4 million in civil penalties. ADT agreed to a $2 million settlement, the FTC said.

The four other companies were: Ameriquest Mortgage Company, Alarm King, Direct Security Services and Guardian Communications.

"By bringing enforcement actions, like those announced today, we will ensure that the small number of bad actors pay a price for not adhering to the law and respecting consumers' privacy requests," said FTC chairwoman Deborah Platt Majoras.

Majoras also said the Justice Department, acting on the FTC's behalf, will allege in a federal court complaint that California-based Global Mortgage Funding made hundreds of thousands of calls to consumers on the Do Not Call registry.

The FTC accused Craftmatic and three of its subsidiaries of running a sweepstakes for a Craftmatic bed and using the phone number that consumers provided on the entry form to later call entrants even though their numbers were on the Do Not Call list.

ADT and two of its dealers, Alarm King and Direct Security Services, were accused of directly marketing security systems to consumers who had placed their numbers of the list.

The registry prohibits telemarketers from calling phone numbers on the list. Companies face fines of up to $11,000 for each violation.

But the practice is likely to continue.

"Telemarketing, teleservices - the channel is effective and therefore it will be with us for many years to come," Tim Searcy, CEO of American Teleservices Association, told CBS News.

Majoras admits she, too, still gets sales calls.

"I am on the Do Not Call list. I get a few, but they largely stopped," she said on CBS News' The Early Show.

Organizations engaged in charitable, political or survey work are exempt. Companies that have an established business relationship with a customer also may call for up to 18 months after the last purchase, payment or delivery.

But customers can ask specifically to be taken off the calling lists.

"If you're still getting a few of them from these businesses, then you can ask very specifically to be put on their list," Majoras told Early Show co-anchor Julie Chen.

That should stop the calls. "If it doesn't, we enforce that, too," Majoras said.

"We've brought 34 law enforcement actions since the Do Not Call rules went into effect in 2003," she added.
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