Telemarketing Sales Rule NPRM - Supporting Statement - 2024-FINAL

Supporting Statement
Proposed Amendments to the Telemarketing Sales
Rule
16 C.F.R. Part 310
(OMB Control # 3084-0097)
Overview of Information Collection
This is a request for approval of a proposed revision to an existing clearance. On March
7, 2024, the Federal Trade Commission (“FTC” or “Commission”) announced the pending
issuance of a Notice of Proposed Rulemaking (“NPRM”) that would amend the Telemarketing
Sales Rule (“TSR”) to extend its coverage to inbound telemarketing calls by consumers to
technical support services – i.e., calls that consumers make in response to an advertisement
through any medium or to a direct mail solicitation. The proposed amendment would newly
require these inbound tech support calls to comply with the Rule’s recordkeeping and
disclosure requirements. The proposed amendment is necessary in light of the widespread
deception and consumer injury caused by tech support scams. The proposed amendment would
provide the Commission with the ability to obtain stronger relief in cases involving tech support
scams, including civil penalties and consumer redress.
(1-2) Necessity for Collecting the Information/Use of the Information
Congress enacted the Telemarketing and Consumer Fraud and Abuse Prevention Act
(“Telemarketing Act” or “Act”) in 1994 to curb deceptive and abusive telemarketing practices
and provide anti-fraud and privacy protections for consumers receiving telephone solicitations
to purchase goods or services.1 The Telemarketing Act directed the Commission to adopt a rule
prohibiting deceptive or abusive telemarketing practices, including prohibiting telemarketers
from undertaking a pattern of unsolicited calls that reasonable consumers would consider
coercive or abusive of their privacy, restricting the time of day telemarketers may make
unsolicited calls to consumers, and requiring telemarketers to promptly and clearly disclose that
the purpose of the call is to sell goods or services.2 The Act also directed the Commission to
address in its rule other acts or practices that it found to be deceptive or abusive, including acts
or practices of entities or individuals that assist and facilitate deceptive telemarketing, and to
consider including recordkeeping requirements.3 Pursuant to the Act’s directive, the FTC
promulgated the TSR on August 23, 1995,4 and has since substantively amended the Rule
multiple times to address deceptive acts or practices by scammers employing new technologies
and practices.
While the Commission has sued tech support scams for engaging in deceptive practices
under the TSR where applicable, the Commission has brought cases under the FTC Act alone if
1

15 U.S.C. § 6101-6108.
15 U.S.C. § 6102(a)(3).
3
15 U.S.C. § 6101(a).
4
60 FR 43842 (Aug. 23, 1995).
2

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the telemarketer’s practices could arguably fall within an exception to the TSR. In April 2021,
the Supreme Court’s decision in AMG Capital Management, LLC v. FTC overturned forty years
of precedent from the U.S. Circuit Courts of Appeal that had previously held the Commission
could take action under the FTC Act to return money unlawfully taken from consumers through
deceptive practices. As a result, the Commission is now limited in its ability to obtain monetary
relief from tech support scams whose business practices, in some cases, arguably place the
scams beyond the reach of the Rule. Amending the Rule would clarify that all tech support
scams are potentially subject to the Rule.
The proposed amendment would newly require inbound telemarketing calls by
consumers to technical support services – i.e., calls that consumers make in response to an
advertisement through any medium or to a direct mail solicitation – to comply with the Rule’s
recordkeeping and disclosure requirements. As described in Section IV of the NPRM, the
proposed amendment is intended to address the widespread harm caused by deceptive tech
support services, which disproportionately impact older consumers compared to younger ones.
The proposed amendment would provide the Commission with the ability to obtain stronger
relief in cases involving tech support scams, including civil penalties and consumer redress.
(3) Use of Information Technology
The TSR’s recordkeeping provisions permit sellers and telemarketers to keep records in
whatever form, manner, format, or location they choose in the ordinary course of business.
Accordingly, the Rule’s recordkeeping provisions are consistent with the requirements of the
Government Paperwork Elimination Act (“GPEA”).5 Moreover, in its NPRM, the Commission
specifically seeks comments on ways to minimize the burden of the Rule’s collections of
information on industry and individual firms (including small businesses) that must comply with
the Rule. This could include the use of information technology.
Consistent with the GPEA, nothing in the Rule prescribes that the disclosures be made,
records be filed or kept, or signatures be executed, on paper or in any particular format that
would preclude the use of electronic methods to comply with the Rule’s requirements.

(4) Non-Duplication
None of the proposed disclosure or recordkeeping requirements are duplicated by any
other information collection requirements imposed by the Commission. In its NPRM, the
Commission seeks comment and information regarding any potentially duplicative,
overlapping, or conflicting federal statutes, rules, or policies.
(5) Burden on Small Businesses
The proposed disclosure and recordkeeping requirements are designed to impose the
minimum burden on all affected members of the industry, regardless of size. The Commission
also certified that amending the Rules as proposed will not have a significant economic impact
on a substantial number of small entities, and provided notice of that certification to the Small
5

Pub. L. No. 105-277, Title XVII, 112 Stat. 2681-749 (1998), codified at 44 U.S.C. § 3501 et seq.

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Business Administration (“SBA”).
While some sellers or telemarketers subject to the Rule’s requirements are small
businesses, staff believes that everything consistent with the requirements of the Rule has been
done to minimize compliance burden. The Commission believes that the proposed
recordkeeping amendments primarily require the covered entities, including small businesses, to
retain records that they are already generating and preserving in the ordinary course of business.
Although the Act requires the Rule to apply to all covered firms whether they are small entities
or not, the Commission is seeking comment about minimizing impact on small businesses.

(6) Less Frequent Collection
A less frequent proposed disclosure requirement or recordkeeping requirement would
less effectively address the widespread harm caused by deceptive tech support services, which
disproportionately impact older consumers compared to younger ones. The proposed
recordkeeping requirement would require that sellers retain the required records for a period of
not less than five years. Staff believes that a record retention period shorter than this would
hamper and frustrate many investigations under the FTC’s enforcement program. Given the
complexities of identifying the telemarketer and seller responsible for particular telemarketing
campaigns and gathering the necessary evidence, a shorter period of time is no longer a
sufficient amount of time for the Commission to fully complete its investigations of
noncompliance, particularly when the Commission may not investigate noncompliance until
well after the conduct was initiated.
(7) Paperwork Reduction Act Guidelines
The proposed amendment’s information collection requirements are consistent with all
applicable guidelines contained in 5 C.F.R. § 1320.5(d)(2), except for subsection (iv). As noted
in the Overview and responses to Specifications #1-2, the proposed rule would require
respondents to retain records, other than health, medical, government contract, grant-in-aid, or
tax records, for more than three years.
(8) Consultation and Public Comments
Dating back to the Rule’s inception, the Commission has had a long history of
consultation with outside parties, including affected entities and consumers. In connection with
the Commission’s congressionally-mandated review of the Rule,6 the TSR was amended in
January 2003 to include certain new disclosure requirements and to expand the Rule’s
parameters in other ways. During its 2003 and also the 2010 rulemaking processes, the
Commission also considered whether it should modify the recordkeeping provisions in tandem
with the substantive amendments then under consideration. In each instance, however, the
Commission declined to make substantial modifications to that provision, deeming such
changes unnecessary to enact the substantive amendments it was promulgating.
In 2014, the Commission embarked on a regulatory review of the TSR, in which it
6

15 U.S.C. § 6108.

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sought feedback on a number of issues including the existing recordkeeping requirements. It
raised some of the challenges that the Commission has faced in bringing enforcement actions
under the TSR, including the difficulty in obtaining call detail records, and sought feedback on
whether the current recordkeeping requirements are sufficient for law enforcement agencies to
enforce the Rule’s DNC provisions. Specifically, the Commission raised the possibility of
requiring sellers and telemarketers to “retain records of the telemarketing calls they have placed”
to address the Commission’s ongoing law enforcement challenges. It asked for public comments
on: (1) the cost and burden that the lack of such a requirement imposed on law enforcement and
consumers, (2) the cost and burden such a provision would impose, particularly for small
businesses, and (3) whether there is an alternative solution that would reduce the law enforcement
challenges and minimize the burden on industry.
The Commission’s recent Advance Notice of Proposed Rulemaking7 received ten
comments addressing whether the TSR should require inbound tech support calls to comply
with the TSR. Nine comments supported the proposal: six filed anonymously or by consumers,
and three filed by organizations.8 The National Association of Attorneys General (“NAAG”)
“wholeheartedly” agreed with the proposal and believed that amending the TSR will have a
“substantial effect” on tech support scams.9 NAAG stated that the scams “have become one of
the most prevalent scams in the nation over the past few years.”10 The Electronic Privacy
Information Center (“EPIC”) also supported the proposal and noted that the “serious nature of
this fraud is comparable to that in the transactions already singled out for coverage of inbound
calls.”11 USTelecom-The Broadband Association (“USTelecom”) also supported the proposal,
noting that tech support scams are a “significant menace for both consumers and businesses.”12
The Third Party Payments Association (“TPPA”) opposed “prohibiting inbound
telemarketing calls.”13 TPPA acknowledged that these scams disproportionately affect older
adults, but it contended that those problems will “diminish over time” as consumers become
more familiar with technology.14 TPPA also cautions that “prohibiting” inbound tech support
calls could raise conflicts with the FTC’s Policy Statement on Repair Restrictions, create
confusion for consumers and businesses, and “unduly burden legitimate business activity by
prohibiting Inbound telemarketing of technical support services.”15 As explained in Section III
of the NPRM,16 the scope and severity of injury from tech support scams, including their
7

See Advance Notice of Proposed Rulemaking, 84 FR 52393 (Oct. 2, 2019).
The comments are Jennifer Pierce 33-04; Kara V. 33-12; Anonymous 33-02; Anonymous 33-10; and
Anonymous 33-11.
9
NAAG 33-16 at 6.
10
Id. at 7.
11
EPIC 33-17 at 10.
12
UST 33-14 at 7.
13
TPPA 34-14 at 2. The ANPR did not propose prohibiting inbound tech support calls. It proposed
requiring inbound tech support calls to comply with the TSR. It is not clear from TPPA’s comment
whether TPPA’s concerns are limited to the effects of prohibiting tech support calls as opposed to
merely requiring the calls to comply with the TSR.
14
Id.
15
Id.
16
See FTC Report to Congress, Protecting Older Consumers, 2021-2022 (“2022 Protecting Older
Consumers Report”) at 31 (Oct. 18, 2022), available at https://www.ftc.gov/reports/protecting-older8

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impact on older adults, warrants amending the TSR.
(9) Gifts or Payment
Not applicable.
(10-11) Privacy & Confidentiality/Sensitive Questions
The collection of information in this Rule is consistent with all applicable guidelines
contained in 5 C.F.R. § 1320.5(d)(2). To the extent that information covered by a
recordkeeping requirement of the Rule is collected by the Commission for law enforcement
purposes, the confidentiality provisions of Sections 6(f) and 21 of the Federal Trade
Commission Act, 15 U.S.C. §§ 46(f) and 57b-2, will apply.
(12) Burden Estimate
The proposed amendment will newly require certain inbound tech support calls to
comply with the Rule’s recordkeeping and disclosure requirements. This will increase the PRA
burden for sellers or telemarketers as detailed below.
A. Estimated Annual Hours Burden - 123,816 (derived from 19,566 disclosure +
104,250 recordkeeping)
The Commission estimates the PRA burden of the proposed amendment based on its
knowledge of the telemarketing industry and data compiled from the Do Not Call Registry. The
annual hours of burden for sellers or telemarketers will consist of two components: the time
required to make disclosures, and the costs of complying with the Rule’s recordkeeping
requirements.
First the Commission estimates that the disclosure burden will take 19,566 hours.
Calculating the disclosure burden requires estimating the number of inbound tech support calls
that will now be subject to the TSR if the proposed amendment goes into effect. The
Commission uses the same methodology it has used in the past to calculate the disclosure
burden for categories of calls that are excluded from the TSR’s exemptions for inbound calls
As it has in the past, the Commission estimates that there are 1.8 billion inbound
telemarketing calls that result in sales, that consumer injury from telemarketing fraud is $40
billion a year, and that it takes seven seconds to make the disclosures required by the Rule in
inbound calls.
The Commission estimates the disclosure burden for particular categories of calls that
are excluded from the TSR’s exemptions by extrapolating a percentage of those calls based on
their complaint rates in the FTC’s Consumer Sentinel system. The resulting percentage of total
fraud complaints must be adjusted to reflect the fact that only a relatively small percentage of
telemarketing calls are fraudulent. To extrapolate the percentage of fraudulent telemarketing
calls, staff divides a Congressional estimate of annual consumer injury from telemarketing
consumers-2021-2022-report-federal-trade-commission.

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fraud ($40 billion) by available data on total consumer and business-to-business telemarketing
sales ($310.0 billion projected for 2016), or 13%. The two percentages are then multiplied
together to determine the percentage of the 1.8 billion annual inbound telemarketing calls
represented by each type of fraud complaint. That number is then rounded to the nearest ten.
In 2022, there were 2,369,527 fraud complaints and 89,158 complaints about tech support.
Thus, the general sales disclosure burden is 19,566 hours (1.8 billion inbound calls x the
percentage of fraud complaints for tech support (89,158/2,369,527) x the percentage of
telemarketing calls that are estimated to be fraudulent (.13) x the length of the disclosures (8
seconds per disclosure ÷ 3,600 to convert to hours).
Second, the estimated recordkeeping burden is 104,250 hours. Estimating this burden
requires estimating how many new telemarketing entities will be subject to the TSR if the
proposed amendment goes into effect. To create this estimate, staff first estimates the number
of existing telemarketing entities that engage in tech support sales. In calendar year 2022,
10,804 telemarketing entities accessed the Do Not Call Registry; however, 549 were “exempt”
entities obtaining access to data. Of the non-exempt entities, 6,562 obtained data for a single
state. Staff assumes that these 6,562 entities are operating solely intrastate, and thus would not
be subject to the TSR. Therefore, staff estimates that approximately 3,693 telemarketing
entities (10,804 – 549 exempt – 6,562 intrastate) are currently subject to the TSR. To estimate
the percentage of those entities that sell tech support products and services, staff again relies on
the percentage of fraud complaints for tech support out of the total fraud complaints.
(89,158/2,369,527), which is multiplied by the number of telemarketing entities (3,693), to
produce the estimate that 139 telemarketing entities receive tech support calls.
If the proposed amendment goes into effect, additional businesses will likely be covered
by the TSR. For example, tech support companies that advertise their products through general
advertisements and do not engage in upselling may be subject to the Rule for the first time. On
the other hand, companies that market through a combination of advertisements and outbound
telemarketing are already subject to the Rule. Companies that receive inbound calls from
consumers with questions about their products who then engage in upsells of technical support
services are also already subject to the Rule. The Commission estimates that the proposed
amendment will increase the number of telemarketing entities that receive inbound tech support
calls by a factor of 5, which would mean that an additional 695 entities will be covered by the
Rule.
The Commission estimates that after implementation of the separate Final Rule
proceeding which, among other things, requires telemarketers and sellers to maintain additional
records of their telemarketing transactions, complying with the TSR’s current recordkeeping
requirements requires 150 hours for new entrants to develop recordkeeping systems that comply
with the TSR, for a total annual recordkeeping burden of 104,250 hours.
Estimated Revised Annual Labor Cost Burden: $3,544,614.
The Commission estimates annual labor costs by applying appropriate hourly wage rates
to the burden hours described above. The Commission estimates that the annual labor cost for
disclosures will be $315,991. This total is the product of applying an assumed wage of

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$16.15/hour for 19,566 hours of disclosures.17 The Commission estimates that the annual labor
cost for recordkeeping will be $3,228,623.18 This is calculated by applying a skilled labor rate
of $30.97/hour to the estimated 150 burden hours for the estimated 695 entities that will now be
covered by the Rule ($30.97 x 150 x 695).
(13) Capital and other Non-Labor Costs
The Commission estimates that the annual non-labor costs are $55 a year, derived from
$5 for electronically storing audio files, and $50 for storing the required records. The
Commission thus estimates that the annual non-labor costs will be $38,255 (695 entries x $55).
(14) Estimated cost to the Government
Staff does not estimate any additional costs to the Federal Government.
(15) Program Changes or Adjustments
This would be a program change, not an adjustment. The estimated additional annual
hours of burden would be 123,816, and the estimated additional annual labor costs would be
$3,544,614.
(16) Publicizing Results
There are no plans to publish for statistical use any information required by the Rule.
(17) Display of Expiration Date for OMB Approval
This is not applicable, since the Commission will display the expiration date of the
clearance.
(18) Exceptions to the “Certification for Paperwork Reduction Act Submissions”
Not applicable. The FTC certifies that this collection of information is consistent with
the requirements of 5 C.F.R. § 1320.9, and the related provisions of 5 C.F.R. § 1320.8(b)(3),
and is not seeking an exemption to these certification requirements.

17

This figure is derived from the mean hourly wage shown for Telemarketers. See “Occupational
Employment and Wages–May 2022,” U.S. Department of Labor, released April 25, 2023 Table 1
(“National employment and wage data from the Occupational Employment Statistics survey by
occupation, May 2022”), available at https://www.bls.gov/news.release/ocwage.t01.htm.
18
This figure is derived from the mean hourly wage shown for Computer Support Specialists from the
U.S. Department of Labor source set out in the prior footnote.