Proposed revisions to Canada's Competition Act would impose new disclosure rules on telemarketers and ban deceptive practices, including having buyers pay in advance for grossly overpriced goods.
New disclosure requirements during calls will help Canadians distinguish between legitimate operators and scam artists, says Industry Canada, which oversees many of the country's business regulations.
Industry Minister John Manley describes the amendments now before Parliament as "more effective tools" to help authorities clamp down on telemarketing frauds that prey on consumers and tarnish legitimate operators.
Telemarketing fraud would become a criminal offense under the revised law and punishable by a fine or up to five years in jail.
Other proposed measures would give officials more regulatory power to stop misleading advertising or deceptive marketing.
"Studies since the mid-1970s have concluded that criminal sanctions are an incomplete response" to misleading advertising, says the federal agency.
Canada's direct marketing industry group applauds the changes but suggests the best defense against marketing fraud is cautious and educated consumers.
Copyright November 1997, Crain Communications Inc.