DM News Essential Guide to Lists and Databases: Protecting Consumers and the Industry

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If we are to remain responsible list and data providers, now more than ever we need to take a proactive stance screening the telemarketing scripts, mail promotions and e-mail messages that our potential clients plan to use before providing names, phone numbers, addresses or e-mail addresses.


In 2004, the Federal Trade Commission charged three list management companies, accusing them of aiding telemarketers in the marketing of advance fee credit products, which are illegal under the Telemarketing Sales Rule. The FTC position is clear and unyielding. Those of us who provide lists for telemarketing share some responsibility for knowing what promotion will be communicated to those lists and especially for knowing when the script or promotion violates the TSR.


The FTC is not limiting its involvement to telemarketing offers. In its view, those who provide lists to marketers promoting products via e-mail or traditional mail also can be held responsible for reviewing promotions. To avoid problems, we need to adhere strictly to our industry association's guidelines. These require that list owners, brokers, managers, compilers and users of marketing lists "ascertain the nature of the list's intended usage for each materially different marketing use before rental, sale, exchange, transfer or use of the list." Further, list professionals should not permit the use of lists in violation of the industry-set ethical guidelines.


As such, we are required to carefully evaluate promotions and not accept fraudulent, deceptive or illegal mail pieces. Certain offers especially require scrutiny, including credit repair and loan scams, get-rich-quick schemes, rapid weight-loss claims, bogus health products and travel and vacation deceptions. MKTG Services' compliance efforts center on a five-step program:


Step one is to train all employees thoroughly on the importance of being compliant and what to look for regarding processes and procedures.


Step two is list rental agreements. We insist on signed list rental agreements from everyone we do business with. We advocate annual agreements that detail the offer, usage terms, industry compliance language and contain a signature. They provide a defensible position in court.


Step three is ensuring that purchase orders and clearances are in order. When clearing list orders, the list professional needs to be a gatekeeper for the mailer or list owner.


Step four is reviewing sample mail pieces and decoys to ensure that mailers use your lists in the agreed-upon way.


Step five is documentation. Save everything including purchase orders, samples, decoys, clearances and e-mails.


In screening, we follow the adage, "If an offer sounds too good to be true, then it isn't." It is our responsibility to be self-regulating. See that lists are used properly and establish a compliance strategy. Being cautious and refusing offers that don't seem proper will prove a sound business practice.


To evaluate the background of a company with potentially questionable advertising, contact:


· Better Business Bureau (in the advertiser's area).


· State or local consumer agencies.


· Your state attorney general's office.


· Postal inspector (in the advertiser's area).


· Trade associations.


· Federal Trade Commission.


· U.S. Postal Inspection Service.


For more information, go to the Direct Marketing Association's Guidelines for Ethical Business Practice at www.the-dma.org/guidelines/ethicalguidelines.shtml.


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