“Poor enforcement against telemarketers making Do Not Call list ineffective”

Privacy activists across Canada, last week, applauded the proposal of a new anti-spam bill presented to the House of Commons, which would penalize the distributors and facilitators of spam.

But the bill had a couple of surprise clauses tacked on the end, affecting dinner-time phone conversations, rather than mid-morning Inbox overload.

Those who inspected the bill closely found the final few pages of the Electronic Commerce Protection Act might eliminate Canada’s six-month-old Do Not Call list.

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SLIDESHOW: Canada’s Do Not Call List – What you need to know

If passed, the bill would repeal section 41.1 and 41.7 of the Telecommunications Act, eliminating the need for a Do Not Call list by giving consumers the choice of opting in rather than opting out of telemarketing schemes.

The six-month-old list has been incredibly popular, thus far, with more than six million Canadians registered for the telemarketing opt out.

A survey of more than 2,000 Canadians conducted by the Market Research and Intelligence Association found that 80 per cent of respondents have received  fewer phone calls since signing up for the service.

However, 13 per cent of Canadians said they actually began receiving more calls after adding their number to the list!

While it is not known why this would be the case, the market research group attributed the growth to rogue telemarketers who randomly dial numbers in large quantities.

Bill Huzar, president of the Consumers Council of Canada  said he’s continued to experience unsolicited computerized calls since signing up for the do-not-call list, but the frequency of such calls is decreasing.  The Council is a Toronto-based consumer advocacy group.

Huzar said for many Canadians the frequency of calls has increased tremendously during the 30-day grace period telemarketers have to get their lists up to date, but has tended to decrease the following month. 

Do Not Call or an invitation to call?

In January, the Consumers Council of Canada said they feared widespread availability of the list and small access fee made the service counter-productive by allowing unscrupulous telemarketers to use the list to add numbers to their registry rather than take them away.

Another expert makes the same argument and says the approach Canada has taken to eliminate pesky calls is ineffective.

The surprise addition to the Electronic Commerce Protection Act is a hint the federal government knows the Do Not Call list is problematic as well, according to Michael Geist, who holds the Canada Research Chair of Internet and E-commerce Law at the University of Ottawa.

“Six million numbers can easily be purchased … unlike other countries that have actually required marketing organizations to take their list and scrub it against the do-not-call list, requiring telemarketers to submit their lists and then identify which numbers are on it. Canada is literally disseminating millions of numbers and has no control.”

Through an access to information request, Geist found many disconcerting elements related to the actual Do Not Call list itself, as well as who is accessing it.

“When you look at who has purchased the list, you see a list of company names as well as pseudonyms, which becomes clear that there is no oversight to ensure the list doesn’t fall in to the wrong hands and isn’t widely abused.”

Misuse is “tip of the iceberg”

But the misuse of the Do Not Call list, is just “the tip of the iceberg,” says Geist.

 He says the consumer-driven complaints process is currently flawed because of an inadequate policing mechanism.

The Do Not Call list is designed to give the consumer the power to influence the behavior of telemarketers. Customers are asked to record certain information so the compliant can be properly investigated — including date and time of offending call, the name, and the number of calling party.

Complaints filed via the Internet or phone to Bell Canada – the operator of the Do Not Call list – are passed off to the Canadian Radio-television Commission (CRTC), which investigates the problem and determines action.

There have been more than 100,000 complaints, about 20,000 a month, according to CRTC spokesperson Lynne Fancy.   

Bell Canada, the operator of the national list, reviews each complaint and determines whether it is valid or invalid. Those deemed valid are sent  on to the  CRTC who after further investigation can impose penalties.

The CRTC has issued 70 warning letters, thus far, according to Fancy.

That’s astounding when you consider there have been thousands of complaints, critics note.

No financial fines have been imposed so far, a problem for deterring future unscrupulous telemarketers, Geist pointed out.

“The overwhelming majority of complaints are treated as invalid,” he noted.

One likely reason for this sorry state of affairs, he says, is the many exceptions permitted under this law. “It’s a problem because many Canadians expect calls will be reduced but in nearly every circumstance, telemarketing continues.”

In addition, allowing Bell to adjudicate on which complaints have prima facie validity and which don’t also involves an obvious conflict of interest, Geist argues.

This is especially so because targets of various complaints include telecommunication companies, retailers and banks. This means Bell is ruling on complaints about themselves and their competitors;

Bell did not wish to comment on the Do Not Call list.

But Fancy said the CRTC is not worried about any conflict of interest: “This is clearly not an issue,” she said.”There is a prima facie step in complaints-handling, but we have verified that process and are confident we are receiving all the complaints and are doing all the investigations.”

Issuing warning letters are also a normal part of the enforcement process, she said. When letters are issued, the CRTC asks for responses back and if none are given, the commission then moves to other enforcement measures, such as financial penalty.

“We are very pleased with how the system is working and are always looking for improvements and making maintenance adjustments.”

But Geist is unconvinced; calling the system “a disaster” at this stage.

His solution: tighten penalties or abolish the Act altogether and move towards the opt-in system, as suggested in last week’s anti-spam bill.

Many readers of Geist’s blog shared his sentiments: “Another example of having the proper idea in mind but then not enforcing the rules,” one person wrote.

Consumers Council of Canada’s president, Huzar, also recommends tighter penalties to weed out the bad apples, but said he’s happy with the overall reduction of nuisance calls.

Companies not abiding by the Do Not Call complaints system, firms not registered or doing business in Canada, and telemarketers from the U.S. dealing with U.S.-based firms, could all use a stiffer warning, he said.

We probably won’t see any significant improvement until there’s better enforcement, and defaulters are fined severely for violations, he said.

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