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NO. 42. AN ACT RELATING TO CONSUMER FRAUD.

(H.226)

It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1. 9 V.S.A. 2451a(a) is amended to read:

(a) "Consumer" means any person who purchases, leases, contracts for, or otherwise agrees to pay consideration for goods or services not for resale in the ordinary course of his or her trade or business but for his or her use or benefit or the use or benefit of a member of his or her household, or in connection with the operation of his or her household or a farm whether or not the farm is conducted as a trade or business, or a person who purchases, leases, contracts for, or otherwise agrees to pay consideration for goods or services not for resale in the ordinary course of his or her trade or business but for the use or benefit of his or her business or in connection with the operation of his or her business.

Sec. 2. 9 V.S.A. 2464 is added to read:

2464. TELEMARKETING TRANSACTIONS

(a) For the purposes of this section, "telemarketer" means any person who initiates telephone calls to, or who receives telephone calls from, a consumer in connection with a plan, program or campaign to market goods and services. The term "telemarketer" does not include:

(1) A federally-insured depository institution or its subsidiary when it obtains or submits for payment a check, draft or other form of negotiable instrument drawn on or debited against a person’s checking, savings, share or other depository account at that institution.

(2) Any person that submits a payment when the consumer authorizing the submission has, prior to the effective date of this section, entered into a written contract with the person for the issuance of a charge or credit card.

(3) Any other category of persons, that the attorney general may exempt by rule consistent with the purposes of this section.

(b) It is an unfair and deceptive act and practice in commerce for any telemarketer directly or through an agent:

(1) to procure the services of any third-party delivery, courier or other pickup service to obtain a consumer’s payment for goods, unless the goods are delivered at the time that the consumer’s payment is obtained by the courier; or

(2) to obtain or submit for payment a check, draft or other form of negotiable instrument drawn on a person’s checking, savings, share or other depository account without the consumer’s express written authorization.

(c) It is an unfair and deceptive act and practice in commerce for any person, including a third-party delivery, courier or other pickup service, or the telemarketer’s financial institution as defined in 8 V.S.A. 1022(5), but not including the consumer’s financial institution as defined in 8 V.S.A. 1022(5), to provide substantial assistance to a telemarketer in violation of subsection (b) of this section when the person or the person’s authorized agent knows or consciously avoids knowing that the telemarketer is engaging in an unfair or deceptive act or practice in commerce.

Sec. 3. 9 V.S.A. 2475(b) is amended to read:

(b) No paid fundraiser or charitable organization shall misrepresent, directly or indirectly, to a contributor or potential contributor any fact relating to the solicitation, including, but not limited to, the percentage of the contribution that will be paid over to the charitable organization or the purpose for which the contribution will be used.

Sec. 4. 9 V.S.A. 2475(e) is added to read:

(e) No paid fundraiser shall solicit a contribution from any person in this state without clearly and conspicuously disclosing to the person, prior to the time the person makes or authorizes payment of a donation:

(1) that the solicitor is being paid by the charitable organization on whose behalf the solicitation is being made; and

(2) how the potential contributor may obtain information from the state on the respective percentages of contributions that will be paid to the charitable organization and to the paid fundraiser.

Sec. 5. 9 V.S.A. 2479(b) is amended to read:

(b) The attorney general has the same authority to make rules, conduct civilinvestigations, and bring civil actions with respect to the acts and practices of paid fundraisers and charitable organizations as is provided under subchapter 1 of this chapter.

Approved: June 10, 1997