DMA ethics committee draws attention to non-compliant companies

The Direct Marketing Association acted on consumer complaints and published the names of five companies whose marketing practices are not in compliance with DMA’s self-regulatory Guidelines for Ethical Business Practice. Star Financial,, Aristar Resorts, DADA USA Inc. and Union Federal Mortgage Corp. were the five companies listed. None of the companies responded to DM News in time for press.

“A compliant company is one who is following our self-regulatory Guidelines for Ethical Business Practice,” said Pat Kachura, DMA SVP of corporate responsibility. “If we get complaints about companies, our member-driven ethics committees investigate the allegations and work with companies to get them into compliance. We do this for both members and non-members. The goal is to promote the best practices in responsible marketing. Most companies are willing to work with us to correct their practices.”

However, if companies do not respond, the DMA publicizes their names. If a non-compliant company is a DMA member, the organization can revoke their membership.

Compliance with the Guidelines is a requirement of DMA membership. DMA’s Committee on Ethical Business Practice and Teleservices Ethics Committee are comprised of executives from member companies who investigate complaints about marketing practices that may violate DMA’s self-regulatory guidelines.

If a company does not cooperate with DMA, and the committees believe violations of law may also have occurred, DMA refers the complaint to the appropriate law enforcement agencies.

From January 2007 to July 2007, the two DMA committees investigated 37 complaints about mail, e-mail and telephone solicitations as well as the collection and sharing of marketing data. DMA was able to work with most of the companies involved to correct questionable practices.

Star Financial, Irvine, CA, did not fully address committee concerns about allegedly misleading promotional offers. The company initially responded to DMA’s inquiry by revising the questioned mortgage loan promotion, but did not address the absence of a privacy policy on its Web site., Delray Beach, FL, did not respond to committee concerns about the source of promotional e-mails and the alleged promotion of “free” gift certificates. The matter was referred to the Federal Trade Commission (FTC) for review.

Aristar Resorts , Phoenix, was referred to the FTC, the Federal Communications Commission (FCC), and the Arizona Attorney General’s office because of committee concerns about cell phone calls allegedly made without affirmative consent.

DADA USA Inc., New York, was referred to the FTC, the FCC and the New York Attorney General’s office for alleged failure to obtain affirmative consumer/parental consent for its ring tone subscription service, failure to disclose clearly and conspicuously the material terms of its agreement, and alleged failure to promptly honor refund and cancellation requests.

Union Federal Mortgage Corp., Nanuet, NY, was referred to the FTC, the FCC, the New York Attorney General’s office and the New Jersey Division of Consumer Affairs because of committee concerns regarding alleged unsolicited automated calls.

In addition to the 37 in-depth case reviews, staff from DMA’s Corporate Responsibility department handled more than 5,000 inquiries from consumers needing assistance with reducing their overall volume of unwanted solicitations; having their names removed from lists of specific marketers; or making complaints about marketing transactions.

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