An Ounce of Prevention
by Michele Shuster
Many businesses are surprised to find out about the far reaching
boundaries of the state and federal consumer protection laws and the
corpulent jurisdiction under those laws of the state Attorneys General and
federal enforcement agencies such as the Federal Trade Commission.
Unfortunately for many, this realization comes too late.
All fifty states have a general consumer protection statute, most
modeled after the federal Unfair or Deceptive Acts or Practices (UDAP)
statute. These laws prohibit companies from engaging in unfair or
deceptive behavior in a transaction with a consumer. By way of example,
Ohio's UDAP statute is known as the Consumer Sales Practices Act. Ohio's
statute was enacted in 1972 and has been interpreted by the courts to
apply to a broad range of transactions and untruthful representation by
businesses. Many industries are specifically regulated by the
administrative rules interpreting the statute, including retailers, the
automobile industry, companies going out of business and any company
engaging in a marketing program.
Recently, there has been a significant rise in enforcement actions
involving state and federal UDAP statutes. A major contributing factor to
this increase is the cooperation that exists between the states and
federal agencies. This increased cooperation is leading to more actions
being brought and ones that involve multiple states in a single action.
Often, these are difficult and expensive actions to defend.
So what can a business do to protect itself? Most importantly, become
knowledgeable of the consumer protection laws that apply to your business.
Once you know the law, implement policies and procedures that dictate
compliance to those laws and train your staff on them. Many companies run
afoul of the law because of uninformed employees.
Another effective prevention strategy is to become familiar with how
your attorney general's office functions. Most attorney general offices
offer a free consumer complaint service. Consumers who feel they have been
cheated by a business can file a complaint with the office. The office
tracks all complaints received against a company and often decides who
they will pursue an enforcement action against based upon the number of
complaints received against a company. Smart business will monitor
complaints received against them and work to take corrective action once
they receive a complaint.
The bottom line for a company is become informed about the regulations
that apply to your business and implement an effective compliance
Listen to the latest in our series of compliance
Top 10 Compliance Mistakes - How to Avoid
Learn about the top 10 mistakes that can keep you out of
legal hot water when conducting inbound or outbound consumer telephone
marketing campaigns from guest speaker and leading contact center legal
expert, attorney Michele Shuster.
To listen to this and all our past webinars covering the
latest, in-depth topics on compliance and Do Not Call regulations visit http://www.dnc.com/complianceInfo/Resources/