Last year, the FTC released a summary focused upon the mechanics of lead generation, as well as related privacy, data use and consumer protection issues.  The report provides agency staff perspectives on the information discussed at the FTC’s October 2015 workshop on lead generation, “Follow the Lead.”

Key takeaways:

  1. FTC acknowledgement that lead generation possesses significant value to consumers when conducted consistent with consumer protection principles.
  2. Clearly, conspicuously, prominently and accurately advise consumers how, by whom and to whom data is collected, used and purchased.
  3. Prominently and accurately explain the full terms, risks and potential costs to consumers.
  4. Thoroughly vet lead providers and purchasers.  Document the process of ensuring that applicable laws, rules and regulations are complied with and reasonably ensure that consumer information is not utilized for nefarious, illegitimate or unauthorized purposes throughout the entire life of the lead.  Monitor lead sources for deceptive claims and other warning signs like complaints.
  5. Ignoring warning signs that third-parties are violating the law.  Pleading ignorance will not shield companies from regulatory action.
  6. Clearly, conspicuously, prominently and accurately advise consumers whether the lead may be sold to intermediaries and how each potential lead recipient will use consumer information.
  7. Avoid selling remnant leads to buyers with no legitimate need for sensitive data.
  8. Be transparent with consumers about who you are and never misuse consumers’ sensitive information.
  9. Avoid deceptive or aggressive marketing.
  10. Keep sensitive data secure.

If you are in a high-risk vertical or suspect that you may be a potential target, contact an FTC Defense Lawyer to discuss applicable requirements and the implementation of measures to avoid regulatory scrutiny.

A copy of the Staff Perspective can be seen, here.

Richard B. Newman is an Internet marketing compliance and regulatory defense attorney at Hinch Newman LLP focusing on advertising and digital media matters. His practice includes conducting legal compliance reviews of advertising campaigns, representing clients in investigations and enforcement actions brought by the Federal Trade Commission and state Attorneys General, commercial litigation, advising clients on promotional marketing programs, and negotiating and drafting legal agreements.

HINCH NEWMAN LLP. ADVERTISING MATERIAL. These materials are provided for informational purposes only and are not to be considered legal advice, nor do they create a lawyer-client relationship. No person should act or rely on any information in this article without seeking the advice of an attorney. Information on previous case results does not guarantee a similar future result.

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