Telemarketing Surety Bonds: High Rates For A Reason

Telemarketing surety bonds (also known as a telephone solicitor bond) have higher premium rates than most other license bonds, and there is a reason for it. Legislatures felt that telemarketers invaded Americans personal lives for too long. Most states have legislation with numerous restrictions on telemarketers, with stiff fines when procedure is not properly followed. The Federal “Do Not Call” program also made a difficult situation for telephone solicitors, forbidding them to call a good portion of their clients. The flood of new laws against telemarketers put many businesses in a desperate situation.

The laws restricting telemarketer businesses are plentiful. Below we will review many common restrictions and how they could result in a bond claim. I worked as a telephone solicitor for years to make ends meet in college. Therefore, I believe I have intimate knowledge of both sides of the story.

The solicitor is to identify them-self by their first and last name and the name of the business on whose behalf he or she is calling. This requirement is rather simple and self explanatory. However, trainees are often nervous when they start and will often forget procedures even as simple as stating their name and company name. This wouldn’t be a concern to bonding companies so much if turn around of employees was not so rapid within the telephone solicitor industry.

The solicitor is required to have a written contract that is identical to the description of the goods or services offered in the telephone solicitation, contains the name, address, telephone number and license number of the seller, and states the buyers right to cancel immediately preceding the signature. Telemarketers are often rewarded financially if they make a certain amount of sales. Often greed comes into play and a solicitor may not be completely honest with what the client will be getting.

Can not intimidate, harass, threaten or use profane language during a telemarketing call. I have never seen heard anyone act inappropriately while on the line with a client. However, the fast employee turnovers could result in an increased chance of harassment occurring.

Calls are restricted to after 8 a.m. and before 9 p.m. I felt the company I worked for had their management run exceptionally well. However, from time to time a calling list using a different time zone would be mistakenly used and people would get calls before or after the allotted time period. This was usually due to human error and was correctly rather quickly, but it still happened from time to time.

Calls can not be made to anyone who stated that they do not wish to receive calls from that specific company. I personally never made a call to anyone who claimed they requested to be taken off of the company list. However, I have personally received calls after being signed up on the Federal “Do Not Call” list. Therefore, there still are companies out there that are making the mistake of calling prohibited numbers.

Each local exchange telephone company is required to inform its customers of their rights with respect to telemarketers and automatic dialing-announcing devices. This was covered very well in training at the company I was employed at. They also employed random quality control listeners to ensure that the solicitors were properly stating their requirements. However, calls were not monitored often and when mistakes were found the solicitor usually only received a verbal slap on the wrist.

It is unlawful for a telemarketer to give false or misleading information. While I can proudly say I never mislead anyone, I can’t say the same for my co-workers at the time. However, the wording of this requirement is vague and is left in the eye of the beholder.

All telemarketers are required to keep, for at least 24 months from the date a record is produced, records of all financial transactions, written notices, disclosures, and acknowledgments, including records of calls resulting in a promise by the customer to pay or otherwise exchange consideration for goods and services, the name and last known address of each prize recipient and the prize awarded having a value of $25 or more, and the name and other identifying information of all current and former employees directly involved in telephone sales. I do not have great insight on the management side of telephone solicitation, therefore I can’t say much on this requirement. However, most companies make use of new technologies that do all of the record keeping dirty work for them. I do not see this requirement being a problem, provided the company has the proper equipment to keep track of their records.

I do not want to give the wrong impression in stating that all telemarketing companies operate in the same fashion as my previous employer. Some may be better others may be worse. The above is simply an example using my personal experiences with one telemarketing company.

The general public is not in favor of receiving telephone solicitations. Therefore, telemarketers are an easy target for the legislatures to impose new rules and regulations on. The telemarketing industry will see higher premium rates for some time to come due to the numerous regulations and stiff fines associated with them.

Eric is the Chief Marketing Officer of JW Surety Bonds. With years of experience in the surety industry, he is also a contributing author to the surety bond blog. He has held a range of different roles within the surety industry, from agent assistant to bond issuer, which gives him a unique insider perspective on surety related topics.

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