Sunday
December 21, 2014

Prospecting

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Prospecting

As you search for prospects, be sure you're familiar with these key laws.

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 Do-Not-Call, -Fax, or -E-mail

Summary:
Do-Not-Call:
The federal “Do-Not-Call” law makes it illegal to cold call or otherwise make a solicitation over the phone to any household that’s listed its phone number in the Federal Trade Commission’s Do-Not-Call registry, unless one already has a business relationship with that household or has permission from the household to call. A business can also continue to call its former customers for up to 18 months after the last transaction. Additionally, a business can call consumers for up to three months after a consumer inquiry. The rules don’t regulate surveys, political awareness calls, charitable solicitations, or other calls not involving a commercial solicitation.

Do-Not-Fax:
It’s unlawful to send an unsolicited commercial message via fax unless the sender has permission or an established business relationship with the recipient. All fax messages must contain an option for recipients to opt out of future faxes. Opt-outs must be complied with within 30 days.

Do-Not-E-mail (CAN-SPAM):
All commercial electronic mail messages must contain 1) a legitimate return e-mail and physical postal address, 2) a clear and conspicuous notice of the recipient's opportunity to “opt-out,” or decline to receive future messages, 3) an opt out mechanism active for at least 30 days after message transmission, and 4) a clear and conspicuous notice that the message is an advertisement or solicitation. A consumer’s opt-out request must be honored within ten business days. A business can give consumers a menu of opt-out options. If a consumer consents to receiving commercial electronic mail messages from the business, the business must still comply with other requirements, except that the business does not have to mark the electronic mail message as an advertisement or solicitation.

Regulators:
Federal Trade Commission 
Federal Communications Commission

Original statutory authority:
Do-Not-Call: “Do-Not-Call Implementation Act of 2003,” Public Law No. 108-10
Do-Not-Fax: “Junk Fax Prevention Act of 2005,” Public Law No. 109-21
Do-Not-E-mail: “CAN-SPAM Act of 2003,” Public Law No. 108-187

Penalties:
Do-Not-Call:
Fines of up to $11,000 per call for lawsuits brought by the federal government, and $500 per call for lawsuits brought by a state attorney general or by a consumer. A consumer may bring a lawsuit only after having received at least two telemarketing calls from the business within a 12-month period. The rules contain a “safe harbor” for mistakes. If a seller or telemarketer can show that, as part of its routine business practice and pursuant to its Do-Not-Call policy, it meets all the requirements of the safe harbor, it will not be subject to civil penalties or sanctions for mistakenly calling a consumer who has asked for no more calls, or for calling a person on the registry. Many states have their own do-not-call laws, but the federal law pre-empts less restrictive state do-not-call laws.

Do-Not-Fax:
Fines of up to $1,500 per fax for violations (the penalty is $500 per fax, with treble damages for willful violations). There is a private right of action, so any recipient can bring a lawsuit alleging a violation.

Do-Not-E-mail:
No private right of action for consumers; the law is enforced by federal agencies and state attorneys general (Internet service providers may also bring lawsuits against egregious spammers). The recoverable damages are $250 per message, up to $2 million total. Treble damages for willful violations.

More information:
NAR Field Guide to Do-Not-Call, Fax, and E-Mail

This summary is not a comprehensive analysis of how the law applies to you.  Consult a qualified real estate attorney to determine how the federal law and laws in your state impact you in this area.

 

 Mortgage Acts and Practices (MAP)-Advertising rule

Summary:
Real estate professionals and others who make commercial communications to consumers about mortgage credit products are prohibited from making misrepresentations about the products and also must keep records of their communications for two years.  “Commercial communications” applies to oral and written statements (such as handing out a lender’s rate card) designed to “create an interest in purchasing goods or services,” which in this case would be a mortgage credit product. The rule doesn’t cover purely informational materials about mortgage credit products, such as prequalifying buyers or general information about interest rates.  Real estate professionals should include a disclaimer on all communications covered by the MAP rule, because a properly crafted disclaimer can protect against later misrepresentation claims. 

Regulators:
Federal Trade Commission
U.S. Consumer Financial Protection Bureau

Original statutory authority:
2009 Omnibus Appropriations Act

Penalties:
Violators face civil penalties of $16,000 per day per violation and also disgorgement of ill-gotten gains. 

More information:
NAR Map Rule Q&A
Final MAP-Advertising Rule

This summary is not a comprehensive analysis of how the law applies to you.  Consult a qualified real estate attorney to determine how the federal law and laws in your state impact you in this area.

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