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NO. 5.  AN ACT RELATING TO TELEMARKETING TRANSACTIONS.

(H.162)

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

Sec. 1.  9 V.S.A. § 2464 is amended to read:

§ 2464.  TELEMARKETING TRANSACTIONS

(a)  For the purposes of this section,:

(1)  “Express oral authorization” means that a consumer has explicitly authorized an electronic funds transfer from his or her financial account for goods or services offered by a telemarketer:

(A)  during a telephone call in which the telemarketer has clearly stated that the consumer is authorizing the transfer from his or her account, and has further stated the consumer’s name, the date on or after which the account will be debited, the amount of the transfer, a telephone number for consumer inquiries that is answered during normal business hours, and the date of the authorization; and

(B)  where the telemarketer has either tape-recorded the consumer’s authorization and not disposed of the recording until at least two years after the authorization, or has provided written notice to the consumer, prior to the settlement date of the transfer, confirming the terms of the authorization as described in subdivision (A) of this subdivision (2).

(2)  “Financial account” means a checking, savings, share, or other depository account.

(3)  “Process” includes printing a check, draft or other form of negotiable instrument drawn on or debited against a consumer’s financial account, formatting or transferring data for use in connection with the debiting of a consumer’s account by means of such an instrument or an electronic funds transfer, or arranging for such services to be provided to a telemarketer.

(4)  “telemarketer” “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 or services. The term “telemarketer” does not include:

(1)(A)  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)(B)  Any person that submits a payment when the consumer authorizing the submission has, prior to July 1, 1997, entered into a written contract with the person for the issuance of a charge or credit card.

(3)(C)  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 financial account without the consumer’s express prior written authorization.

(3)  to obtain funds from a person’s financial account by means of an electronic funds transfer unless:

(A)(i)  the consumer has initiated the telephone call to the telemarketer; or

(ii)  the telemarketer and the consumer have a current written agreement for the provision of goods or services, or the consumer has purchased goods or services from the telemarketer within the previous two years; and

(B)  the telemarketer has obtained the consumer’s express oral authorization to the transfer prior to initiating the debit.

(c)  It is an unfair and deceptive act and practice in commerce for a party other than a federally-insured depository institution to process for payment from a consumer’s financial account, in connection with a telemarketer’s transaction with the consumer:

(1)  a check, draft, or other form of negotiable instrument drawn on or debited against such account without the consumer’s prior written authorization; or

(2)  an electronic funds transfer from such account for goods or services offered by a telemarketer, unless:

(A)(i)  the consumer has initiated the telephone call to the telemarketer; or

(ii)  the telemarketer and the consumer have a current written agreement for the provision of goods or services, or the consumer has purchased goods or services from the telemarketer within the previous two years; and

(B)  the telemarketer has obtained the consumer’s express oral authorization to the transfer prior to initiating the debit.

(c)  It (d)  In addition to the legal liability described in subsection (c) of this section, 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) 10202(5), but not including the consumer’s financial institution as defined in 8 V.S.A. § 1022(5) 10202(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.

Approved:  March 25, 2005



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us