IIA
103D CONGRESS
1ST SESSION
H. R. 868
IN THE SENATE OF THE UNITED STATES
MARCH 3, 1993
Received; read twice and referred to the Committee on Commerce, Science,
and Transportation
AN ACT
To strengthen the authority of the Federal Trade Commis-
sion to protect consumers in connection with sales made
with a telephone, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Consumer Protection
Telemarketing Act’’.
SEC. 2. FINDINGS.
The Congress makes the following findings:
(1) Telemarketing differs from other sales ac-
tivities in that it can be carried out by sellers across
State lines without direct contact. Telemarketers can
also be very mobile, easily moving from State to
State.
(2) Interstate telemarketing fraud has become a
problem of such magnitude that the resources of the
Federal Trade Commission are not sufficient to in-
sure adequate consumer protection from such fraud.
(3) Consumers and others are estimated to lose
$10,000,000,000 a year in telemarketing fraud.
(4) Consumers are victimized by other forms of
telemarketing deception and abuse.
(5) Consequently, Congress should enact legis-
lation that will offer consumers necessary protection
from telemarketing deception (including fraud) and
abuse.
SEC. 3. TELEMARKETING RULES.
(a) IN GENERAL.—
(1) The Commission shall prescribe rules pro-
hibiting 
deceptive 
(including 
fraudulent)
telemarketing 
activities 
and 
other 
abusive
telemarketing activities.
(2) The Commission shall include in such rules
respecting deceptive telemarketing activities—
(A) a definition of deceptive telemarketing
activities, and
(B) criteria that are symptomatic of decep-
tive telemarketing as distinguished from ordi-
nary telemarketing business practices.
(3) The Commission shall include in such rules
respecting other abusive telemarketing activities a
requirement that telemarketers may not undertake a
pattern of unsolicited telephone calls which the rea-
sonable consumer would consider coercive or abusive
of such consumer’s right to privacy. In prescribing
the rules described in this paragraph, the Commis-
sion shall consider—
(A) including a requirement that goods or
services offered by telemarketing be shipped or
provided within a specified period and that if
the goods or services are not shipped or pro-
vided within such period, a refund be required,
and
(B) including, where practicable, authority
for a person who orders a good or service
through telemarketing to cancel the order with-
in a specified period.
(b) RULEMAKING.—
(1) The Commission shall prescribe the rules
under subsection (a) within 270 days after the date
of enactment of this Act. Such rules shall be pre-
scribed in accordance with section 553 of title 5,
United States Code.
(2) A rule issued under subsection (a) shall be
considered a rule issued under section 18(a)(1)(B)
of the Federal Trade Commission Act.
(c) ENFORCEMENT.—Any violation of any rule pre-
scribed under subsection (a) shall be treated as a violation
of a rule under section 5 of the Federal Trade Commission
Act (15 U.S.C. 45) regarding unfair or deceptive acts or
practices.
(d) SECURITIES
AND
EXCHANGE
COMMISSION
RULES.—
(1) PROMULGATION.—
(A) IN GENERAL.—Except as provided in
subparagraph (B), not later than 6 months
after the effective date of rules promulgated by
the Commission under subsection (a), the Secu-
rities and Exchange Commission shall promul-
gate, or require any national securities ex-
change or registered securities association to
promulgate, rules substantially similar to such
rules to prohibit deceptive and other abusive
telemarketing activities by persons described in
paragraph (2).
(B) EXCEPTION.—The Securities and Ex-
change Commission is not required to promul-
gate a rule under subparagraph (A) if it deter-
mines that—
(i) Federal securities laws or rules
adopted by the Securities and Exchange
Commission thereunder provide protection
from 
deceptive 
and 
other 
abusive
telemarketing by persons described in
paragraph (2) substantially similar to that
provided by rules promulgated by the Com-
mission under subsection (a); or
(ii) such a rule promulgated by the
Securities and Exchange Commission is
not necessary or appropriate in the public
interest, or for the protection of investors,
or would be inconsistent with the mainte-
nance of fair and orderly markets.
If the Securities and Exchange Commission de-
termines that an exception described in clause
(i) or (ii) applies, the Securities and Exchange
Commission shall publish in the Federal Reg-
ister its determination with the reasons for it.