Understanding the risks of TCPA and DNC violations

Understanding the risks of violating the Telephone Consumer Protection Act (TCPA) and Do Not Call (DNC) regulations starts with understanding the regulations themselves. The TCPA was created to protect consumers from unwanted telephone marketing calls by restricting the use of an automated telephone dialing system (ATDS) and maintaining and adhering to DNC lists. 

Like the federal TCPA law, many states are passing their own telemarketing legislation. Some of the differences in the laws include call frequency limits, consent requirements, the definition of an autodialer and telemarketing call, as well as minimum and maximum penalties per incident. 

The National Do Not Call Registry is a database maintained by the United States federal government, listing the telephone numbers of individuals and families who have requested that telemarketers not contact them. Under the TCPA, it is prohibited to contact someone who has registered their phone number on the DNC. In addition to the National DNC registry, 11 states operate their own DNC lists: Colorado, Florida, Indiana, Louisiana, Massachusetts, Missouri, Oklahoma, Pennsylvania, Tennessee, Texas, and Wyoming.   

Organizations also have internal DNC lists that also must be honored and maintained to prevent TCPA violations.  

Common types of TCPA and Do Not Call violations 

Under the TCPA, here are the most common types of TCPA violations.  

Unauthorized pre-recorded voice messages (robocalls)  

Unauthorized pre-recorded voice messages, otherwise known as robocalls, are unlawful under the TCPA, unless the caller has received express prior written consent to contact the consumer. 

Unsolicited text messages  

Unsolicited text messages are unlawful under the TCPA. The TCPA requires express written consent before contacting someone via SMS or text message.  

Autodialed calls to cell phones  

It is not permitted to contact someone on their wireless device using an ATDS. Only calls made to residential lines are permitted while using an ATDS or the system with a capacity to be an ATDS, unless the caller has received express prior written consent to contact the consumer. 

Do Not Call violations

Under the TCPA, it is prohibited to contact someone who has registered their phone number on the DNC. When you contact someone on the national, state, or internal DNC list, you are at risk of getting fined.  

There are a few exceptions to Do Not Call violations (also known as “DNC Violations”). If you have express written consent to contact someone, if you have an established business relationship, or if their State/internal-level DNC has expired then you may be able to contact them without penalty. The National Do Not Call registry does not expire. Once you register your phone number on the National DNC, you never need to re-register it. State and internal DNCs, however, may have an expiration date. If the consumer you are trying to contact is on a state or internal-level DNC, they may be okay to contact after a period of time (depending on where they live/the internal DNC policy). 

Established business relationships (EBR) are also a contact exemption. There are two types of EBRs: inquiry and past transaction. An inquiry EBR happens when a consumer makes an inquiry about an organization’s goods or services. In those cases, the company is permitted to contact the consumer for up to 3 months from the date of inquiry or application. A past transaction EBR occurs when a company establishes a business relationship with a consumer based on the consumer’s last date of purchase, delivery, or payment, and may then call them for up to 18 months after that last transaction. The rules and timelines of EBRs can vary by state/region, so be sure to understand the different nuances of where you are calling to avoid fines. 

Express written consent is also an exemption. Regardless of if the contact is on a DNC list, if they give your organization express written permission to be contacted, you may contact them without being penalized. 

Deceptive caller ID practices (spoofing)  

It is prohibited to partake in deceptive caller ID practices under the TCPA. Deceptive caller ID (often referred to as spoofing) is when the caller’s name or business does not match the telephone number. 

Risks of violating TCPA and DNC compliance regulations 

There are multiple consequences of violating TCPA compliance regulations, ranging from monetary fines to damaged reputation.  

Fines of $500 to $1500 per violation/call  

The TCPA has a fine of $500 per violation/call if the caller unknowingly violates the TCPA and $1500 per violation/call if it proven that the caller willingly and knowingly violated any restrictions. This may not sound like a lot, but these fines add up quickly if your organization is found to have made more than 1 unlawful call.  

Civil lawsuits  

In addition to monetary fines under the TCPA, civil lawsuits may arise from do not call violations. A civil lawsuit occurs when an individual holds the responsible party accountable for financial and emotional losses that resulted from personal injury. Civil lawsuits seek financial compensation only, making them popular amongst TCPA cases. While the fines for violating the TCPA can cost up to $500 or $1500 depending on the violation, there is no cap on statutory damages under the TCPA so thousands of dollars of violations can end up resulting in millions of dollars’ worth of penalties.   

Class action lawsuits  

A class action lawsuit is a type of civil lawsuit in which charges against a company or individual are brought forth by several plaintiffs. Class action lawsuits resulting from TCPA violations are among the most common types of class action lawsuits because TCPA violations have the largest payout in the history of American class action lawsuits. This is why understanding TCPA compliance is so critical to the success of your business. 

Damaged brand and reputation  

When businesses violate the TCPA, their brand and reputation are also affected negatively. The amount of money spent on fines and legal fees is nothing compared to the damage of a poor brand reputation. The fines and lawsuits can be paid, but your brand reputation will suffer long after it becomes known that you violated the TCPA.  

Reduced shareholder value  

In addition to fines, lawsuits, and brand damage, violating TCPA compliance regulations may also result in reduced shareholder value. Shareholder value is the value delivered by a company to investors who own shares in the company. When companies get hit with costly fines and lawsuits, the value of the company decreases, therefore reducing shareholder value as well. This can result in substantial financial losses for investors, reduced ability to raise capital, and more.   

Loss of consumer trust  

Loss of consumer trust is another massive consequence of violating TCPA compliance laws. When you violate a consumer’s privacy or do not honor their contact preferences by sending unsolicited messages or making unwanted calls, they are likely to lose trust in your business. When consumers lose trust that you can operate your business ethically, they may never purchase your products or services again. Can your business afford to lose consumer trust?  

How you can prevent TCPA and DNC violations

To help protect your organization against the risks of violating TCPA and DNC regulations, consider implementing a solution to eliminate risk across your entire organization. 

If you’re interested in building your own TCPA compliance solution, make sure you’re prepared by downloading our comprehensive eBook “How to gauge the ROI of a build vs. Buy solution” for an in-depth look at what it will take to build your own compliance solution. 

If you prefer a built for you option, Gryph for Compliance is the only real-time, automated solution that mitigates risk of DNC and TCPA violations for all outbound communications. Gryphon’s tier 1 carrier-grade networks gets into the path of the call to block non-compliant interactions from any device, regardless of location, to safeguard your organization from making non-compliant calls.  

Our solution leverages real-time updates and manages complex rules and regulations to ensure that you are always protected against federal, state, and local laws. 

Are you ready to start your compliance journey? Contact gryphon.ai today.