Metropolitan News-Enterprise


Tuesday, January 13, 2004


Page 1


Lockyer Sues Telemarketer, Contends ‘Survey’ About Refinancing Violated Federal ‘Do Not Call’ Laws


By DAVID WATSON, Staff Writer


Attorney General Bill Lockyer sued a Florida firm yesterday, contending it violated national “Do Not Call” laws by pretending to conduct surveys in an effort to contact California consumers about refinancing their mortgages.

“Federal law makes it clear that commercial calls are off limits to consumers who have placed their names on the national Do Not Call Registry,” Lockyer said in a statement. “This lawsuit should serve as a warning to telemarketers who think they can evade this important consumer protection law by pretending to conduct a ‘survey’ while harassing Californians in the privacy of their homes.”

Lockyer’s office said in a statement that since November 2003, L.M.A. Marketing, Inc.—doing business as Mortgage Concepts—has placed automated calls to California consumers under the guise of conducting a “survey.”  In a pre-recorded message, the New Smyrna Beach, Fla.-based company asks questions relating to whether the consumer is interested in refinancing, the statement said.

   If the consumer’s responses indicate an interest, an L.M.A. representative calls back to pitch the company’s refinancing service, the Attorney General’s Office said.

The statement announcing the lawsuit said more than 250 Californians have lodged complaints with the Attorney General’s Office about the company.  Those complaining said they were told when they advised the company representative they were on the “Do Not Call” list that the firm is exempt from the federal law because it is conducting a survey, the statement asserts.

The complaint, filed in U.S. District Court in Sacramento, alleges the company’s conduct violated the federal Telephone Consumer Protection Act and the Telemarketing and Consumer Fraud and Abuse Prevention Act.

   Under the TCPA, the attorney general can obtain $500 in damages per violation, and $1,500 if the violations are willful or knowing. The Telemarketing Act permits recovery of actual damages, restitution and other compensation on behalf of California consumers illegally contacted by the company.

The complaint also alleges the company violated California Business and Professions Code Sec. 17200 by engaging in unfair business practices. That statute permits the attorney general to obtain civil penalties of up to $2,500 for each violation of the telemarketing laws.

The complaint asserts the firm also violated federal rules that prohibit solicitors from making telemarketing calls or using pre-recorded, automated messages without providing the consumer the firm’s name and phone number. The rules require that information so the consumer can ask the company to stop making the calls, a request with which the company must by law comply, the attorney general’s statement said.

Lockyer noted that several other companies throughout the country also do business under the name Mortgage Concepts. Only L.M.A. is targeted by the lawsuit, he said.

The suit asks the court to permanently enjoin L.M.A. from continuing the practices, and to award at least $200,000 for violations which have already occurred. It also demands that the firm reimburse the Attorney General’s Office for the costs of the investigation and prosecution.

The lawsuit is the second brought by the California Attorney General’s Office since the federal Do Not Call laws went into effect October.

   In early November, Lockyer filed the nation’s first Do Not Call lawsuit against American Home Craft, Inc., a Hayward-based company, with offices in Sacramento, San Diego and Irvine. That suit contends the firm made illegal telemarketing calls to Californians who had placed their phone numbers on the “Do Not Call” registry.

Lockyer noted in his statement that as of Jan. 1, California has its own “Do Not Call” law, which provides civil penalties of $11,000 per violation.  Similar to the federal statutes, California’s law prohibits commercial phone calls to residential numbers registered on the FTC’s “Do Not Call” list.

Like the federal law, the state statute provides exceptions for non-commercial calls placed by charities, political associations and survey takers. The suit filed yesterday was brought under the federal statutes because the violations occurred before the state law took effect, Lockyer said.

Efforts to reach L.M.A. for comment yesterday were unsuccessful.


Copyright 2004, Metropolitan News Company