With cell phones overtaking landlines as the new “home phone” for many consumers, things could get tricky for credit card holders and other debtors as well as the creditors who need to reach them.
The Federal Communications Commission wants to limit the ability of collectors to use autodialers to call cell phones. But the unintended consequences could make credit more costly as well as harder to get for younger customers.
The FCC’s proposed revision
At issue is a proposed FCC action to revise the Telephone Consumer Protection Act (TCPA) of 1991 in an effort to align its regulations with Federal Trade Commission rules.
The do-not-call rules already restrict telemarketers from calling cell phones. But the new FCC revisions would cover any call to a cell phone, including legitimate calls to collect a debt, notify a customer of a payment due, or request additional information to complete an application.
Confusion about consent
Businesses are puzzled at how compliance might work under the new rule. If approved, the proposed rule would no longer permit creditors to call a customer’s cell phone when the cell number was filled in on an application.
The proposed rule changes the definition of what constitutes prior consent. Just having a phone number on an application wouldn’t be sufficient. Companies would be required to have written permission, such as “I consent to calling my cell phone when there’s a problem…”
When a cell phone is the only phone
This raises new issues. For instance, if a consumer needs to be contacted, but the company doesn’t know the cell phone is the only line, the company could still be liable for calling it.
What now?
The good news is that this issue hasn’t moved anywhere over the last year. The rule was proposed in March of 2010 and comments were accepted up to last May, but nothing has happened since.
From a regulatory perspective, the level of industry concern over the FCC’s proposed rule warrants some caution. While some form of revision could still go forward, the modification may not be in line with FTC rules.
Are you concerned about the FCC’s proposed cell phone rule? Let us know if you’ve developed contingencies in case it’s approved.
We’ll be sure to keep you up to date on any new developments, so watch this space for updates.
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