Senate Bill No. 154
(By Senators Bowman, McKenzie, Edgell and Kessler)
____________
[Introduced February 16, 2001; 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 article six-f, chapter forty-six-a of the code of West
Virginia, one thousand nine hundred thirty-one, as amended, be
amended by adding thereto three new sections, designated sections
one hundred two-a, four hundred three and four hundred four; and
that sections three hundred one, three hundred two, three hundred
three and five hundred one of said article be amended and
reenacted, 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 may 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 shall 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 is 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 is 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 the 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
database to compile a list of telephone numbers of residential
subscribers who object to receiving telemarketing solicitations. The commission shall have the database in operation before the
first day of January, two thousand two.
(a) The database may be operated by the commission or by
another entity under contract with the commission.
(b) Before the first day of January, two thousand two, 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 database;
(6) Methods by which a person or entity desiring to make
telemarketing solicitations may obtain access to the database as
required to avoid calling the telephone numbers of residential
subscribers included in the database;
(7) All other matters relating to the database 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 database
of telephone numbers of subscribers who object to receiving
telemarketing solicitations, the commission shall include the
part of the single national database that relates to West Virginia in the database established under this section.
PART V. UNFAIR OR DECEPTIVE ACTS OR PRACTICES; PENALTIES.
§46A-6F-501. Unfair or deceptive acts or practices.
(a)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 subsection;
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 use 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.
§§46A-6F-102a, 403 and 404 are new; therefore,
strike-throughs and underscoring have been omitted.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language that would be added.