SENATE PASSES BILL TO PROTECT AGAINST FRAUDULENT TELEMARKETING

Bill Is Expected To Pass Assembly

Wednesday, June 14, 2000

The New York State Senate today passed legislation (S.8116), sponsored by Senator George D. Maziarz (R-C, North Tonawanda), to prohibit deceptive telemarketing practices. The bill represents a three-way agreement among the Senate, Assembly and Governor.

This legislation, which is a top priority of the American Association of Retired Persons (AARP), would protect New York State consumers, particularly senior citizens, from illegitimate telemarketing practices. The bill was also a priority recommendation of the Senate Majority Task Force on Privacy Invasion.

"This legislation goes beyond existing federal law to send a clear message to telemarketers that unscrupulous, deceptive solicitation tactics will not be tolerated in New York State," said Senator Maziarz (R-C, North Tonowanda), Chairman of the Senate Committee on Aging. "My goal is to protect all consumers from telemarketing fraud, especially senior citizens, a group which is often the target of crimes of this nature. I�m pleased that we have been able to reach an agreement on this bill with Governor Pataki and the Assembly so we can get it enacted into law."

"While most legitimate telemarketers do not use fraudulent practices we must protect consumers, particularly senior citizens, against those who capitalize on these predatory practices which go way beyond the invasion of someone's privacy," said Senate Majority Leader Joseph L. Bruno. " According to the New York State Office of the Aging, approximately 85% of victims of telemarketing fraud are those over the age of 65. Passage of this bill by both houses is truly a victory for senior citizens in New York State."
The bill, called the Telemarketing and Consumer Fraud and Abuse Prevention Act, would prohibit fraudulent practices not addressed by the federal Telemarketing Sales Rule of 1996.

A representative of AARP who testified at a public hearing conducted by the Task Force said consumers lose about $40 billion a year as a result of telemarketing fraud and added that the state should enact a law which picks up where the federal law leaves off.

"In no way is my intent to cause concern for legitimate businesses, such as mail order catalogue companies," Senator Maziarz said. "Through this legislation I believe a proper balance has been struck between allowing telemarketing companies the flexibility to compete in today's marketplace and the need to protect consumers from fraudulent and abusive practices."

The bill would:
� Require telemarketers to be bonded and registered with the Department of State with a few noted exemptions;
� Prohibit telemarketers from accessing a customer's checking, savings, bond, trust or other account without the customer's express written authorization;
� Prohibit courier pickups to obtain a customer's payment for goods and services only after the customer has the opportunity to inspect the items before they make payment;
� Prohibit abusive acts, including engaging any person repeatedly or continuously with behavior that is abusive or harassing in nature and continuing to contact a person when the individual has stated previously they do not wish to receive solicitation calls from the seller;
� Require telemarketers to state in a clear and coherent manner the following information at the beginning of a solicitation call:
-the basic characteristics and quality of the goods and services that is being offered;
-that the purpose of the call is to offer goods and services for which a fee will be charged; and
-the total cost of the goods and services;
� Require telemarketers to keep records of calls and sales for 24 months.
� Establish that any waiver of the provisions of this act by any customer shall be unenforceable and void;
� Authorize the Department of State to assess administrative fines and penalties;
� Authorize any district attorney, county attorney or municipal corporation counsel to bring action to enforce this act on behalf of residents and;
� Establish civil penalties for violating the provisions of this act and misdemeanor offenses if convicted of engaging in deceptive telemarketing acts and practices.

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