Senate Bill No. 349
(By Senator Bowman, McKenzie, Edgell and Kessler)
____________
[Introduced January 31, 2000; referred to the Committee
on the Judiciary; and then to the Committee on Finance.]
____________
A BILL to amend article six-f, chapter forty-six-a of the code of
West Virginia, one thousand nine hundred thirty-one, as
amended, by adding thereto three new sections, designated
sections one hundred two-a, four hundred three and four
hundred four; and to amend and reenact sections three hundred
one, three hundred two, three hundred three and five hundred
one of said article, all relating to defining "caller
identification service"; changing the telemarketers'
registration, security and record keeping office to the public
service commission; prohibiting telephone solicitation of
consumers who have notified the public service commission that
they object to receiving telephone solicitations; requiring the public service commission to compile a database of the
telephone numbers of residential consumers who have objected
to receiving telephone solicitations; and making it an unfair
practice to knowingly circumvent the use of caller
identification service of a residential telephone subscriber.
Be it enacted by the Legislature of West Virginia:
That sections three hundred one, three hundred two, three
hundred three and five hundred one, article six-f, chapter
forty-six-a of the code of West Virginia, one thousand nine hundred
thirty-one, as amended, be amended and reenacted; and that said
article be further amended by adding thereto three new sections,
designated sections one hundred two-a, four hundred three and four
hundred four, all to read as follows:
ARTICLE 6F. TELEMARKETING.
PART I. DEFINITIONS.
§46A-6F-102a. Caller identification service.
"Caller identification service" is a type of service which
permits telephone subscribers to see the telephone number of
incoming telephone calls.
PART III. REGISTRATION, SECURITY AND RECORD KEEPING.
§46A-6F-301. Registration of telemarketers.
(a) No person shall act as a telemarketer without first having
registered with the secretary of the department of tax and revenue
chairman of the public service commission.
(b) The initial application for registration shall be made at
least sixty days prior to offering consumer goods or services, or
offering for sale consumer goods or services through any medium,
and an application for renewal shall be made on an annual basis
thereafter. The department of tax and revenue public service
commission shall charge reasonable application and renewal fees
for administration of the registration requirements pursuant to
this article. The application and renewal fees shall be
established through the promulgation of a legislative rule pursuant
to chapter twenty-nine-a of this code. The fees so collected
shall be deposited into the state treasury to the credit of the
special revenue fund known as the "telemarketer registration fund"
pursuant to section three hundred four of this article.
(c) The application for a certificate of registration or
renewal shall include, but not be limited to, the following
information:
(1) The true name, mailing address, telephone number and
physical address of the telemarketer, including each name under which the telemarketer intends to engage in telemarketing;
(2) Each occupation or business that the telemarketer's
principal owner has engaged in for two years immediately preceding
the date of the application;
(3) Whether any principal or manager has been convicted, or
pled guilty to, or is being prosecuted by indictment for,
racketeering, any violations of state or federal securities laws,
a theft offense, or any consumer protection law or telemarketing
law;
(4) Whether there has been entered against any principal or
manager an injunction, temporary restraining order or a final
judgment in any civil or administrative action, involving fraud,
theft, racketeering, embezzlement, fraudulent conversion,
misappropriation of property, or any consumer protection law or
telemarketing law, including any pending litigation against the
applicant;
(5) Whether the telemarketer, at any time during the previous
seven years, has filed for bankruptcy, been adjudged bankrupt or
been reorganized because of insolvency;
(6) The true name, current home address, date of birth, social
security number and all other names of the following:
(A) Each person participating in or responsible for the
management of the seller's business;
(B) Each person, office manager, or supervisor principally
responsible for the management of the seller's business.
(7) The name, address and account number of every institution
where banking or any other monetary transactions are done by the
seller.
§46A-6F-302. Security requirement.
(a) An application for registration or renewal shall be
accompanied by a continuing surety bond executed by a corporation
that is licensed to transact the business of fidelity and surety
insurance in the state of West Virginia. The bond must be approved
by the department of tax and revenue public service commission
before a certificate of registration is issued in accordance with
the provisions of section three hundred one of this article. A
separate bond in the amount of one hundred thousand dollars may be
filed for each telemarketing location, including each principal
office and each branch office thereof, or a single bond in the
amount of five hundred thousand dollars may be filed for all
locations of the telemarketer.
(b) The bond shall provide that the telemarketer will pay all damages to the state or a private person resulting from any
unlawful act or action by the telemarketer or its agent in
connection with the conduct of telemarketing activities.
(c) The registration of any telemarketer shall be void upon
termination of the bond of the surety company, or loss of the bond,
unless, prior to such termination, a new bond has been filed with
the department of tax and revenue public service commission. The
surety, for any cause, may cancel the bond upon giving a sixty-day
written notice by certified mail to the telemarketer and to the
department of tax and revenue public service commission. Unless
the bond is replaced by that of another surety before the
expiration of the sixty-day notice of cancellation, the
registration of the telemarketer shall be treated as lapsed.
(d) The surety bond shall remain in effect for three years
from the period the telemarketing business ceases to operate in
this state.
(e) Any business required under this article to file a bond
with a registration application, may file, in lieu thereof, an
irrevocable letter of credit, with annual renewals, a certificate
of deposit, cash or government bond in the same amount as would be
required for the bond. The department of tax and revenue public service commission shall deposit any such funds in an interest
bearing account. The department of tax and revenue public service
commission shall hold such letter of credit, cash, certificate of
deposit or government bond for three years from the period the
telemarketing business ceases to operate or registration lapses, in
order to pay claims made against the telemarketing business during
its period of operation. At the end of the three-year term all
interest accrued, not required for payment of claims, shall be
remitted to the telemarketer.
(f) The registration of the telemarketing business will be
treated as lapsed if at any time, the amount of the letter of
credit, bond, cash, certificate of deposit or government bond falls
below the amount required by this section.
(g) Should the license of any surety company to transact
business in this state be terminated, all bonds given pursuant to
this article upon which such company is surety shall thereupon be
suspended, and the department of tax and revenue public service
commission shall immediately notify each affected licensee of such
suspension and require that a new bond be filed. This notice shall
be sent by registered or certified mail, return receipt requested,
and shall be addressed to the telemarketer at his or its principal place of business as shown by the department of tax and revenue
public service commission records. The failure of any telemarketer
to file a bond with new or additional surety within thirty days
after being advised in writing by the department of tax and revenue
public service commission of the necessity to do so shall be cause
for the department of tax and revenue public service commission to
revoke the telemarketer's registration.
(h) An action may be brought in any court of competent
jurisdiction upon the bond by any person to whom the licensee fails
to account and pay as set forth in such bond. The aggregate
liability of the surety company to all persons injured by a
telemarketer's violations may not exceed the amount of the bond.
§46A-6F-303. Failure to register or meet security requirement;
remedies.
(a) Any person is subject to a civil administrative penalty,
to be levied by the department of tax and revenue public service
commission, of not more than five thousand dollars if the person:
(1) Acts as a telemarketer without first registering pursuant
to section three hundred one of this article;
(2) Acts as a telemarketer without first meeting the security
requirements set forth in section three hundred two of this article;
(3) Acts as a telemarketer after failing to maintain a
certificate of registration accompanied by a surety bond as
required by sections three hundred one and three hundred two of
this article;
(4) Includes any material information on a registration
application that is false or misleading; or
(5) Misrepresents that a telemarketer is registered.
In assessing a civil administrative penalty, department of tax
and revenue public service commission shall take into account the
seriousness of the violation, any good faith efforts to comply with
applicable requirements, any benefit obtained by the act or
omission, and any other appropriate factors as the department of
tax and revenue public service commission may establish by rules
proposed for promulgation by the Legislature in accordance with the
provisions of article three, chapter twenty-nine-a of this code.
(b) No assessment shall be levied pursuant to subsection (a)
of this section until after the alleged violator has been notified
by certified mail or personal service. The notice shall include:
(1) A reference to this section, sections three hundred one
and three hundred two of this article, and any legislative rule that was allegedly violated;
(2) A concise statement of the facts alleged to constitute the
violation;
(3) A statement of the amount of the administrative penalty to
be imposed; and
(4) A statement of the alleged violator's right to an informal
hearing.
(c) The alleged violator has twenty calendar days from receipt
of the notice within which to deliver to the department of tax and
revenue public service commission a written request for a hearing.
If no hearing is requested, the notice becomes a final order after
the expiration of the twenty-day period. If a hearing is
requested, the department of tax and revenue public service
commission shall inform the alleged violator of the time and place
of the hearing. The department of tax and revenue public service
commission may appoint a hearing examiner to conduct the hearing
and then make a written recommendation to the department of tax and
revenue public service commission concerning the assessment of a
civil administrative penalty. Within thirty days following the
hearing, the department of tax and revenue public service
commission shall issue and furnish to the alleged violator a written decision which explains the rationale for any assessment of
an administrative penalty. The authority to levy an administrative
penalty is in addition to all other enforcement provisions of this
article and the payment of any assessment does not affect the
availability of any other enforcement provision in connection with
the violation for which the assessment is levied. No assessment
levied pursuant to this section becomes due and payable until the
procedures for review of such assessment as set out in this
subsection have been completed.
(d) The department of tax and revenue public service
commission may seek an injunction, or may institute a civil action
against any person allegedly in violation of the provisions of this
section, sections three hundred one and three hundred two of this
article. An application for injunctive relief or civil action
under this section may be filed and relief granted notwithstanding
the fact that all administrative remedies provided for in this
article have not been exhausted or invoked against the person or
persons against whom such relief is sought. Upon request of the
department of tax and revenue public service commission, the
division or the prosecuting attorney of the county in which the
violation occurs shall assist the department of tax and revenue public service commission in any civil action under this section.
(e) Independently of the department of tax and revenue public
service commission, with respect to any action brought by the
division or a private citizen regarding unfair or deceptive acts or
practices, or abusive acts or practices under the provisions of
this article or under other applicable consumer protection laws set
forth in this code, the division or a private citizen may also
apply to the court for appropriate relief under this section
against a person violating the provisions of sections three hundred
one and three hundred two of this article, pending final
determination of the proceedings.
(f) Any funds recovered and all registration fees, as provided
for in this article, shall be paid into the state treasury to the
credit of a special revenue fund to be known as the "telemarketer
registration fund" which is hereby created. The moneys so credited
to the fund shall be used solely for the purposes of administering
and enforcing the registration and security requirements of this
article.
PART IV. DISCLOSURES, CONTRACT REQUIREMENTS AND
NO TELEMARKETING SOLICITATION CALLS DATABASE.
§46A-6F-403. Prohibition of telephone solicitations to consumers who have notified the public service commission of
his or her objections.
No person or entity may make or cause to be made any
telemarketing solicitation to the telephone line of any residential
subscriber in this state who has given notice to the commission of
his or her objection to receiving telemarketing solicitations.
§46A-6F-404. Registration for consumer database.
The public service commission shall establish and operate a
data base to compile a list of telephone numbers of residential
subscribers who object to receiving telemarketing solicitations.
The commission shall have the data base in operation before the
first day of January, two thousand one.
(a) The data base may be operated by the commission or by
another entity under contract with the commission.
(b) Before the first day of January, two thousand one, the
commission shall promulgate regulations which shall include all of
the following:
(1) A requirement that each local exchange company and each
competing local exchange carrier shall inform on an annual basis
its residential subscribers of the opportunity to provide
notification to the commission or its contractor that the subscriber objects to receiving telemarketing solicitations. The
information shall be disseminated at the option of the carrier by
television, radio, or newspaper advertisements; written
correspondence; telephone book subscription forms; or any other
method not expressly prohibited;
(2) A requirement that each local exchange company and each
competing local exchange carrier shall inform on a monthly basis
its residential subscribers of the opportunity to provide
notification to the commission or its contractor that the
subscriber objects to receiving telemarketing solicitations. The
information shall be disseminated at the option of the carrier by
bill inserts or messages; or any other method not expressly
prohibited;
(3) Methods by which each residential subscriber may give
notice to the commission or its contractor of his or her objection
to receiving solicitations or revocation of the notice;
(4) Methods by which a notice of objection becomes effective
and the effect of a change of telephone number on the notice;
(5) Methods by which objections and revocations are collected
and added to the data base;
(6) Methods by which a person or entity desiring to make telemarketing solicitations may obtain access to the data base as
required to avoid calling the telephone numbers of residential
subscribers included in the data base;
(7) All other matters relating to the data base that the
commission considers necessary.
(c) If, pursuant to 47 U.S.C. Section 227(c)(3), the Federal
Communications Commission establishes a single national data base
of telephone numbers of subscribers who object to receiving
telemarketing solicitations, the commission shall include the part
of the single national data base that relates to West Virginia in
the data base established under this section.
PART V. UNFAIR OR DECEPTIVE ACTS OR PRACTICES; PENALTIES.
§46A-6F-501. Unfair or deceptive acts or practices.
It is an unfair or deceptive act or practice and a violation
of this article for any seller or telemarketer to engage in the
following conduct:
(1) To advertise or represent that registration as a
telemarketer equals an endorsement or approval by the state or any
governmental agency of the state;
(2) To request or receive payment of any fee or consideration
for goods or services represented to remove derogatory information from, or improve, a person's credit history, credit record, or
credit rating until:
(A) The time frame in which the telemarketer has represented
all of the goods or services will be provided to that person has
expired; and
(B) The telemarketer has provided the person with
documentation in the form of a consumer report from a consumer
reporting agency demonstrating that the promised results have been
achieved, such report having been issued more than six months after
the results were achieved;
(3) To obtain or submit for payment a check, draft, or other
form of negotiable paper drawn on a person's checking, savings,
share, or similar account, without that person's express verifiable
authorization. Such authorization shall be deemed verifiable if
any of the following means are employed:
(A) Express written authorization by the customer, which may
include the customer's signature on the negotiable instrument; or
(B) Express oral authorization which is tape recorded and made
available upon request to the customer's bank and which evidences
clearly both the customer's authorization of payment for the goods
and services that are the subject of the sales offer and the customer's receipt of all of the following information:
(i) The date of the draft(s);
(ii) The amount of the draft(s);
(iii) The payor's name;
(iv) The number of draft payments (if more than one);
(v) A telephone number for customer inquiry that is answered
during normal business hours; and
(vi) The date of the customer's oral authorization.
(C) Written confirmation of the transaction, sent to the
customer prior to submission for payment of the customer's check,
draft, or other form of negotiable paper, that includes:
(i) All of the information contained in subparagraphs (i)
through (vi), paragraph (B), subdivision (3) of this section; and
(ii) The procedures by which the customer can obtain a refund
from the telemarketer in the event the confirmation is inaccurate;
(4) To procure the services of any professional delivery,
courier or other pick-up service to obtain immediate receipt and
possession of a consumer's payment unless:
(A) Such service is requested by the consumer;
(B) The consumer is informed that he or she can inspect the
goods or services prior to payment and may refuse to accept the goods or services; and
(C) The consumer is actually afforded an opportunity to
inspect the goods or services prior to payment;
(5) To engage in any other unfair or deceptive conduct which
will create a likelihood of confusion or misunderstanding to any
reasonable consumer;
(6) To misrepresent the requirements of this section;
(7) To provide substantial assistance or support to any
telemarketer when that person knows or consciously avoids knowing
that the telemarketer is engaged in any act or practice that
violates this section;
(8) To engage in any "unfair methods of competition and unfair
or deceptive acts or practices" as specified in subsection (f),
section one hundred two, article six of this chapter and made
unlawful by the provisions of section one hundred four, article six
of this chapter;
(9) To knowingly utilize a method to block or otherwise
circumvent the use of a caller identification service of a
residential telephone subscriber.
NOTE: The purpose of this bill is to define the term, "caller
identification service," change the telemarketers' registration and
reporting office from Tax and Revenue to the Public Service
Commission; prohibit telephone solicitations to persons who have
notified the PSC that they object to them; require the PSC to
maintain a database to compile the phone numbers of persons who
have objected to telephone solicitations; and prevent the
circumventing of caller ID.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
§§46A-6F-102a, 403 and 404 are new; therefore, strike-throughs
and underscoring have been omitted.