When Do Not Call Really Does Mean Do Not Call

The National Do Not Call Rules (DNC) have been around for quite a while but I find that a surprising number of dealership employees think that the rules don’t apply to them. I often hear statements like “Hey, we’re not telemarketers, we’re just doing follow-up”. Unfortunately, it’s not that simple. So I thought it was time for a refresher on the rules and some suggestions on how to avoid potential legal pitfalls.

The DNC rules state that it’s against the law to call, for selling purposes, any number on the National Do Not Call registry, but there are some exceptions.  For instance, under the “existing business relationship” exception, a dealership may call a consumer with whom it has an established business relationship for a limited time after the consumer's last purchase, delivery, or payment - even if the consumer's number is on the National Do Not Call Registry.  Also, dealership staff may call a consumer for a shorter period of time after the consumer makes an inquiry or submits a lead to the company.  

One caveat: if a consumer asks you not to call, the staff may not call, even if there is an established business relationship. In that case, the dealership must honor the request not to call and loses the right to call the consumer, regardless of whether the consumer continues to do business with the dealership. As a result, in addition to the National Do Not Call List, dealerships must maintain an internal Do Not Call list of any consumers who specifically request that the dealership not call them. This is the tricky part at many dealerships.

What type of calls do the DNC rules cover? Covered calls are those made for “commercial” or “selling” purposes that offer to provide or arrange to provide goods or services to consumers. It’s pretty simple, if you’re calling to try to sell something – anything – the rules apply. If you’re calling for any other reason, you’re probably OK.

So what constitutes an “existing business relationship”?  There are two types of established business relationships, both of which are time-limited:

1) A dealership may call a consumer if that consumer has purchased, rented, or leased the business’s goods or services, or if a financial transaction has taken place. The time limitation on this relationship is 18 months after that sale or transaction.

2) If a consumer hasn’t purchased from you, you can call them only if they have made an inquiry or submitted an application to your company, such as a request for a quote. In these cases you can only call up to three months after the original inquiry (NOTE: this time-frame may be further limited by state law. For instance, California only allows for calls to be made for 30 days after an inquiry is made). This exception applies when a consumer visits the dealership and inquires about purchasing, calls for information, or submits an internet lead. The test for whether there's been an inquiry (and thus there could be an established business relationship even where a purchase or transaction hasn't been completed) is that an inquiry has been made of a nature to create an expectation on the part of the consumer that a particular company will call them. So, if a consumer merely called to inquire about business hours or location, that wouldn't do the trick, but asking about a company's products or services, or submitting an application or lead, would.

Another exception is if a consumer has given the dealership express written permission to call, you may call even if the consumer's number is on the National DNC Registry. The consumer must give express agreement in writing to receive calls placed by the seller, including the number to which calls may be made, and the consumer’s signature. The signature may be a valid electronic signature, if the agreement is reached online. The consumer can revoke this permission at any time by asking to be placed on your internal DNC list.

Even permissible calls have restrictions on time of day. They can't be made before 8 a.m. or after 9 p.m. local time at the called party's location. Sellers are also prohibited from blocking the transmission of caller ID information.

There's a safe harbor for sellers that have made a good faith effort to comply with the national DNC rules and a dealership would not be liable for violations that result from an error if the company has made a good faith effort to provide consumers with an opportunity to exercise their do-not-call rights. To fall within the safe harbor, the dealership must demonstrate that, as part of its routine business practice:

1. It has established and implemented written procedures to comply with the do-not-call rules;
2. It has trained its personnel, and any entity assisting in its compliance, in the procedures established pursuant to the DNC rules;
3. It has maintained and recorded a list of telephone numbers the seller may not contact;
4. It uses a process to prevent telemarketing to any telephone number of any list established pursuant to the DNC rules employing a version of the DNC registry obtained from the administrator of the registry within a time-frame specified by rule (the search is required to be made at least once every 31 days); and
5. Any subsequent call otherwise violating the DNC rules is the result of error. 

So, how do you stay on top of these regulations? The good news is that many CRM programs do much of the heavy lifting in terms of flagging consumers on the National DNC list. The not-so-good news is that your CRM can only do so much. Often, decisions must be made at the dealership level as to the validity and timing of established business relationships and consumer placement on the dealership’s internal DNC list. Following are suggestions for staying compliant with DNC rules (for dealers who have a CRM system that automatically accesses the National DNC Registry): 

• All dealership employees should be trained on DNC rules and on how to identify customers flagged as “Do Not Call” in your CRM. Your CRM provider should be asked to provide comprehensive training to ensure that there are no misunderstandings about the system’s capabilities. 
• The dealership should appoint a single point-of-contact who is well-versed in the DNC regulations to administer the program (Compliance Coordinator).
• The DNC Compliance Coordinator should develop and maintain an internal company DNC list.
• All consumer requests to be added to the dealership’s internal DNC list should be routed to the Compliance Coordinator. He or she will be responsible for maintaining the list and flagging the consumers in the CRM. All dealership employees must report any customer Do Not Call request (written or verbal) to the Compliance Coordinator.
• All dealership employees should be instructed that any consumer request not to be contacted (even casual requests) must be immediately reported to the Compliance Coordinator. This includes requests to receptionists and customers telling salespeople “hey, don’t call me anymore”.
• All decisions as to whether or not a consumer falls into the “established business relationship” exception or “express permission to call” exception should be made by the Compliance Coordinator. In other words, no one flagged as “Do Not Call” in the CRM should be called without permission from the Compliance Coordinator.
• These directives should be made a part of the company’s Human Resources process, included in the employee handbook and new-hire orientation, and strictly enforced. Employees should be informed in writing that knowingly calling a person on the Do Not Call list without permission from the Compliance Coordinator is a serious breach of company rules and can lead to disciplinary action. This is vital to ensure safe harbor protection for the dealership in the case of errors.

If the dealership doesn’t have a CRM system that tracks the DNC list, they are required to search the National DNC Registry every 31 days. If new numbers have been added to the registry they are required to drop them from their call lists. The Federal Trade Commission has set up a specific website that businesses can use to access the registry: https://telemarketing.donotcall.gov/profile/create.aspx. When a business accesses the site for the first time a profile will need to be created by including identifiable information about the business. Organizations that subscribe to more than five area codes will be required to pay a fee to access data on the registry. 

So there you have it. The rules are not very complicated but compliance can be tricky and is vitally important. Violators of these rules can be fined up to $16,000 per incident and consumers can bring private actions. In this age of greatly enhanced enforcement actions and lawsuits against dealers, it makes sense to pay attention.