Your Business's Guide to Navigating Compliance with the Telemarketing Sales Rule and National DNC Registry

Business leaders enjoy a lot of perks: delegating tasks, building a brand identity, advancing in their careers, and encouraging, influencing, and inspiring employees. The role also comes with substantial responsibility. Leadership comes with pressure to perform and make tough decisions, ensure employee teamwork and satisfaction, and create and maintain a positive and productive work environment.

As a business leader, you know that successfully engaging with consumers produces higher revenue, increased customer satisfaction, and a stronger brand reputation. A big part of that engagement is strategic and multi-channel customer outreach.

An increasingly important component of a multi-channel marketing approach for businesses is conversational artificial intelligence (AI). Business leaders’ top objectives for conversational AI solutions are focused on:

• Increasing competitive differentiation and resolution in self-service

  Improving customer experience and loyalty and employee productivity

  Reducing customer effort

  Enhancing the value customers receive from their product or service

  If you don’t ensure compliance with federal, state and local rules and regulations when conducting customer outreach through AI, though, your company risks a deteriorating reputation and hefty penalties and fines. The business you’ve worked so hard to build up can come crashing down in a matter of months.

  As we mentioned in a recent blog, businesses must be especially diligent in adhering to strict government regulations designed to protect consumers from unwanted and unsolicited marketing calls and messages. That’s the crux of the Telephone Consumer Protection Act (TCPA), which restricts the making of telemarketing calls and the use of automatic telephone dialing systems (ATDS) and artificial or prerecorded voice messages.

  Although not as prominent as the TCPA, the Telemarketing Sales Rule (TSR) sets strict guidelines for business-to-business (B2B) transactions and outlines what is required from businesses when they engage in telemarketing. A key provision of the TSR is the National Do Not Call (DNC) Registry.

  Understanding the Telemarketing Sales Rule: What It Means for Business Leaders

  Issued in 1995, the TSR has been amended multiple times. The most recent amendments, approved by the Federal Trade Commission (FTC) in November 2024, expanded the TSR to cover tech support scams using telemarketing calls.

  According to the FTC, any businesses or individuals participating in telemarketing must comply with the TSR — with some exceptions. These exemptions include:

  • Unsolicited calls from consumers

    Calls placed by consumers in response to a catalog

    B2B calls — unless they involve retail sales of nondurable office or cleaning supplies or solicit sales or charitable contributions from employees

    Calls made in response to direct mail or general media advertising (with some important exceptions)

    Those telemarketers selling nondurable office or cleaning supplies are not, however, subject to the TSR’s recordkeeping requirements or DNC Registry provisions. Starting on October 15, 2024, the FTC began requiring sellers and telemarketers to store records of their telemarketing calls, consisting of information about:

    • The identity of the telemarketer who placed the call and the identity of the seller or person for whom the call was placed

      The good or service that was the subject of the call

      The calling number, called number, date, time and duration of the call

      The caller identification number transmitted and proof that the telemarketer was authorized to display that caller ID number

      The disposition of the call including whether it was answered, connected or transferred

      As noted in the Federal Register, the TSR prohibits deceptive or abusive telemarketing practices, such as misrepresenting several categories of material information or making false or misleading statements to induce a person to pay for a good or service. Also, unless a telemarketer has a consumer’s prior consent to do otherwise, it’s a violation of the TSR to make outbound telemarketing calls to that person’s home outside the hours of 8 a.m. and 9 p.m. local time at the location called.

      In February 2024, the Federal Communications Commission (FCC) announced the unanimous adoption of a Declaratory Ruling that recognizes calls made with AI-generated voices are “artificial” under the TCPA — and the TSR. Calls made utilizing AI must disclose the caller’s identity and the purpose of the call, and B2B calls and texts are subject to the same wireless restrictions as business-to-consumer (B2C) ones.

      The Financial Impact of Telemarketing Sales Rule Violations

As with the TCPA, violations of the TSR not only result in penalties and fees but also reputational damage, loss of customer trust and decreased brand credibility. Civil penalties for TSR violations run as high as $51,744 per infringement, and businesses non-compliant with the rule are subject to nationwide injunctions that prohibit certain conduct.

In cases where sellers and telemarketers fail to meet the requirement by the TSR to provide certain material information before the consumer pays for the goods or services that are the subject of the sales offer, offenders can incur a civil penalty of $53,088 for each violation. Also, consumers have the right to sue telemarketers for violations of the TSR (and the TCPA).

One of the costliest TSR penalties handed out was against DISH Network, LLC. The satellite television provider was ordered through a settlement with the Department of Justice (DOJ) to shell out $126 million in civil penalties for placing millions of telemarketing calls in violation of the TSR.

Navigating National Do Not Call Registry Compliance: What You Need to Know

Next up is the National DNC Registry, a key provision of the TSR that primarily applies to B2C calls. The registry is a list of phone numbers from consumers who have indicated their preference to limit the telemarketing calls they receive. Managed and enforced by the FTC along with the FCC and state officials, it doesn’t apply to calls made by political organizations, charities, telephone surveyors or businesses with which a consumer has an existing business relationship (EBR).

Under the DNC regulation, calls powered by AI are categorized as telemarketing. That means telemarketing calls made utilizing conversational AI are prohibited — unless the caller procured explicit prior consent.

The FCC requires all telemarketers calling consumers in the United States to download the numbers on the DNC Registry to ensure they don’t call consumers who have registered their phone numbers. Numbers not listed in the DNC Registry are not subject to federal calling restrictions.

Most B2B marketing calls are exempt from DNC rules on the federal level — but some state laws vary. A total of 13 states have their own DNC lists: Colorado, Florida, Indiana, Louisiana, Massachusetts, Mississippi, Missouri, Oklahoma, Pennsylvania, Tennessee, Texas, Washington and Wyoming.

Although reports of unwanted telemarketing calls have decreased by more than 50 percent since 2021, the FTC received over two million Do Not Call complaints in 2024. The top five states reporting the most DNC complaints per 100,000 people are Delaware, Ohio, Virginia, Nevada and Illinois.

Companies that illegally call numbers on the DNC Registry or place an illegal robocall can currently be fined up to $50,120 per call. The FTC has levied 151 enforcement actions against businesses and telemarketers for DNC, robocall, spoofed caller ID and assisting and facilitating violations. Of those enforcement actions, 147 have been resolved, allowing the agency to recover more than $178 million in civil penalties and $112 million in restitution or disgorgement.

Leverage Revmo AI for Effective TSR and DNC Compliance Management

At Revmo, our conversational AI platform provides you with a scalable tool for delivering branded and unified customer interactions across all channels — all while maintaining compliance with regulations of the TSR, DNC, TCPA and others. It also enables your business to leverage real-time analytics to understand customer interactions, measure engagement and optimize communications.

Our system is also designed to comply with state-specific telemarketing laws. We maintain detailed records of all consents obtained for our sales, marketing, support and business communications, including dates, times and methods of consent, and conduct regular training with our staff about calling compliance.

Check out our pricing plans today to see how affordable it is to get started with Revmo AI!

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