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Commission shall publish in the Federal Reg-
ister its determination with the reasons for it.
(2) APPLICATION.—
(A) IN GENERAL.—The rules promulgated
by the Securities and Exchange Commission
under paragraph (1)(A) shall apply to a broker,
dealer, transfer agent, municipal securities deal-
er, municipal securities broker, government se-
curities broker, government securities dealer,
investment adviser or investment company, or
any individual associated with a broker, dealer,
transfer agent, municipal securities dealer, mu-
nicipal securities broker, government securities
broker, government securities dealer, invest-
ment adviser or investment company. The rules
promulgated by the Federal Trade Commission
under subsection (a) shall not apply to persons
described in the preceding sentence.
(B) DEFINITIONS.—For purposes of sub-
paragraph (A)—
(i) the terms ‘‘broker’’, ‘‘dealer’’,
‘‘transfer agent’’, ‘‘municipal securities
dealer’’, ‘‘municipal securities broker’’,
‘‘government securities broker’’, and ‘‘gov-
ernment securities dealer’’ have the mean-
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ings given such terms by paragraphs (4),
(5), (25), (30), (31), (43), and (44) of sec-
tion 3(a) of the Securities and Exchange
Act of 1934 (15 U.S.C. 78c(a)(4), (5),
(25), (30), (31), (43), and (44));
(ii) the term ‘‘investment adviser’’ has
the meaning given such term by section
202(a)(11) of the Investment Advisers Act
of 1940 (15 U.S.C. 80b–2(a)(11)); and
(iii) the term ‘‘investment company’’
has the meaning given such term by sec-
tion 3(a) of the Investment Company Act
of 1940 (15 U.S.C. 80a–3(a)).
(e) COMMODITY FUTURES TRADING COMMISSION
RULES.—
(1) APPLICATION.—The rules promulgated by
the Federal Trade Commission under subsection (a)
shall not apply to persons described in subsection
(f)(1) of section 6 of the Commodity Exchange Act
(7 U.S.C. 8, 9, 15, 13b, 9a).
(2) PROMULGATION.—Section 6 of the Com-
modity Exchange Act (7 U.S.C. 8, 9, 15, 13b, 9a)
is amended by adding at the end the following new
subsection:
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‘‘(f)(1) Except as provided in paragraph (2), not later
than six months after the effective date of rules promul-
gated by the Federal Trade Commission under section
3(a) of the Telemarketing and Consumer Fraud and
Abuse Prevention Act, the Commission shall promulgate,
or require each registered futures association to promul-
gate, rules substantially similar to such rules to prohibit
deceptive and other abusive telemarketing acts or prac-
tices by any person registered or exempt from registration
under this Act in connection with such person’s business
as a futures commission merchant, introducing broker,
commodity trading advisor, commodity pool operator, le-
verage transaction merchant, floor broker, or floor trader,
or a person associated with any such person.
‘‘(2) The Commission is not required to promulgate
rules under paragraph (1) if it determines that—
‘‘(A) rules adopted by the Commission under
this Act provide protection from deceptive and abu-
sive telemarketing by persons described under para-
graph (1) substantially similar to that provided by
rules promulgated by the Federal Trade Commission
under section 3(a) of the Telemarketing and
Consumer Fraud and Abuse Prevention Act; or
‘‘(B) such a rule promulgated by the Commis-
sion is not necessary or appropriate in the public in-
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terest, or for the protection of customers in the fu-
tures and options markets, or would be inconsistent
with the maintenance of fair and orderly markets.
If the Commission determines that an exception described
in subparagraph (A) or (B) applies, the Commission shall
publish in the Federal Register its determination with the
reasons for it.’’.
SEC. 4. ACTIONS BY STATES.
(a) IN GENERAL.—Whenever an attorney general of
any State has reason to believe that the interests of the
residents of that State have been or are being threatened
or adversely affected because any person has engaged or
is engaging in a pattern or practice of telemarketing which
violates any rule of the Commission under section 3, the
State, as parens patriae, may bring a civil action on behalf
of its residents in an appropriate district court of the
United States to enjoin such telemarketing, to enforce
compliance with such rule of the Commission, to obtain
damages, restitution, or other compensation on behalf of
residents of such State, or to obtain such further and
other relief as the court may deem appropriate.
(b) NOTICE.—The State shall serve prior written no-
tice of any civil action under subsection (a) or (f)(2) upon
the Commission and provide the Commission with a copy
of its complaint, except that if it is not feasible for the
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State to provide such prior notice, the State shall serve
such notice immediately upon instituting such action.
Upon receiving a notice respecting a civil action, the Com-
mission shall have the right (1) to intervene in such action,
(2) upon so intervening, to be heard on all matters arising
therein, and (3) to file petitions for appeal.
(c) CONSTRUCTION.—For purposes of bringing any
civil action under subsection (a), nothing in this Act shall
prevent an attorney general from exercising the powers
conferred on the attorney general by the laws of such
State to conduct investigations or to administer oaths or
affirmations or to compel the attendance of witnesses or
the production of documentary and other evidence.
(d) ACTIONS BY THE COMMISSION.—Whenever a civil
action has been instituted by or on behalf of the Commis-
sion for violation of any rule prescribed under section 3,
no State may, during the pendency of such action insti-
tuted by or on behalf of the Commission, institute a civil
action under subsection (a) or (f)(2) against any defend-
ant named in the complaint in such action for violation
of any rule as alleged in such complaint.
(e) VENUE; SERVICE OF PROCESS.—Any civil action
brought under subsection (a) in a district court of the
United States may be brought in the district in which the
defendant is found, is an inhabitant, or transacts business
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award costs of suit and reasonable fees for attorneys and
expert witnesses to the prevailing party.
(e) CONSTRUCTION.—Nothing in this section shall re-
strict any right which any person may have under any
statute or common law.
(f) VENUE; SERVICE OF PROCESS.—Any civil action
brought under subsection (a) in a district court of the
United States may be brought in the district in which the
defendant is found, is an inhabitant, or transacts business
or wherever venue is proper under section 1391 of title
28, United States Code. Process in such an action may
be served in any district in which the defendant is an in-
habitant or in which the defendant may be found.
SEC. 6. ADMINISTRATION AND APPLICABILITY OF ACT.
(a) IN GENERAL.—Except as otherwise provided in
sections 3(d), 3(e), 4, and 5, this Act shall be enforced
by the Commission under the Federal Trade Commission
Act (15 U.S.C. 41 et seq.). Consequently, no activity
which is outside the jurisdiction of that Act shall be af-
fected by this Act.
(b) ACTIONS BY THE COMMISSION.—The Commis-
sion shall prevent any person from violating a rule of the
Commission under section 3 in the same manner, by the
same means, and with the same jurisdiction, powers, and
duties as though all applicable terms and provisions of the
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Federal Trade Commission Act (15 U.S.C. 41 et seq.)
were incorporated into and made a part of this Act. Any
person who violates such rule shall be subject to the pen-
alties and entitled to the privileges and immunities pro-
vided in the Federal Trade Commission Act in the same
manner, by the same means, and with the same jurisdic-
tion, power, and duties as though all applicable terms and
provisions of the Federal Trade Commission Act were in-
corporated into and made a part of this Act.
(c) EFFECT ON OTHER LAWS.—Nothing contained in
this Act shall be construed to limit the authority of the
Commission under any other provision of law.
SEC. 7. DEFINITIONS.
For purposes of this Act:
(1) The term ‘‘attorney general’’ means the
chief legal officer of a State.
(2) The term ‘‘Commission’’ means the Federal
Trade Commission.
(3) The term ‘‘State’’ means any State of the
United States, the District of Columbia, Puerto
Rico, the Northern Mariana Islands, and any terri-
tory or possession of the United States.
(4) The term ‘‘telemarketing’’ means a plan,
program, or campaign which is conducted to induce
purchases of goods or services by use of one or more
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telephones and which involves more than one inter-
state telephone call. The term does not include the
solicitation of sales through the mailing of a catalog
which—
(A) contains a written description, or illus-
tration of the goods or services offered for sale,
(B) includes the business address of the
seller,
(C) includes multiple pages of written ma-
terial or illustrations, and
(D) has been issued not less frequently
than once a year,
where the person making the solicitation does not
solicit customers by telephone but only receives calls
initiated by customers in response to the catalog and
during those calls takes orders only without further
solicitation.
SEC. 8. FALSE ADVERTISEMENTS CONCERNING SERVICES.
Section 12(a) of the Federal Trade Commission Act
(15 U.S.C. 52(a)) is amended by inserting ‘‘services,’’ im-
mediately after ‘‘devices,’’ each place it appears.
SEC. 9. ENFORCEMENT OF ORDERS.
(a) GENERAL AUTHORITY.—Subject to subsections
(b) and (c), the Federal Trade Commission may bring a
criminal contempt action for violations of orders of the
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Commission obtained in cases brought under section 13(b)
of the Federal Trade Commission Act (15 U.S.C. 53(b)).
(b) APPOINTMENT.—An action authorized by sub-
section (a) may be brought by the Federal Trade Commis-
sion only after, and pursuant to, the appointment by the
Attorney General of an attorney employed by the Commis-
sion, as a special assistant United States Attorney.
(c) REQUEST FOR APPOINTMENT.—
(1) APPOINTMENT
UPON
REQUEST
OR
MO-
TION.—A special assistant United States Attorney
may be appointed under subsection (b) upon the re-
quest of the Federal Trade Commission or the court
which has entered the order for which contempt is
sought or upon the Attorney General’s own motion.
(2) TIMING.—The Attorney General shall act
upon any request made under paragraph (1) within
45 days of the receipt of the request.
(d) TERMINATION OF AUTHORITY.—The authority of
the Federal Trade Commission to bring a criminal con-
tempt action under subsection (a) expires 2 years after
the date of the first promulgation of rules under section
3. The expiration of such authority shall have no effect
on an action brought before the expiration date.
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SEC. 10. REVIEW.
Upon the expiration of 5 years following the date of
the first promulgation of rules under section 3, the Com-
mission shall review the implementation of this Act and
its effect on deceptive telemarketing acts or practices and
report the results of the review to the Congress.
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