FTC TO RETHINK NEW TELEMARKETING REGS

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Proposed new telemarketing regulations that had earned the enmity of marketers, in part for barring more than one call to a consumer within three months, will be redrafted by the Federal Trade Commission.

FTC staff members made the announcement last week at a three-day hearing in Chicago into the proposed rules as representatives of marketing, media and telemarketing companies readied to rip the 112 pages of rules while state attorneys general and consumer groups called for more action to protect consumers from scams.

The marketers called the new rules, drawn to implement a new federal law targeting phone fraud, "overbroad" and well beyond the scope of Congress' limited intent of curbing abuses.

A rule aimed at preventing marketers from selling additional products to consumers who haven't yet received their original order was so broad it would bar magazine publishers from calling consumers until subscriptions ran out, the marketers charged.

Still another rule aimed at regulating fax or computer messages was so sweeping that online services could run into legal problems operating certain hours of the day.

"The magazine industry is highly dependent on telemarketing," said Michael Pashby, senior VP at the Magazine Publishers of America. "The [three-month] rule is capricious and arbitrary .*.*."

Robert Sherman, general counsel of the Direct Marketing Association, said the rules "fail to recognize the enormous popularity and convenience of shopping by phone."

Consumer groups, state attorneys general and some law enforcement officials, however, warned that telemarketing abuse is growing and praised the rules.

Lee Norrgard, an investigative analyst for the American Association of Retired Persons' department of consumer affairs, said the proposed rules "strike a balance" and AARP members have been victimized by "recurring scams."

FTC officials said they expected the rules to be redrawn and a new draft presented for comment.

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