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Telemarketing Costs*

Anti-Telemarketers Send Out A Very Busy Signal

By Don Oldenburg

Washington Post Staff Writer

Wednesday, February 20, 2002; Page C01

The phone calls that pushed Diana Mey too far came four years ago from telemarketers selling Sears house siding. Repeatedly ignoring her requests that they stop calling, they brazenly broke federal laws and even claimed the laws didn't apply to them.

After they called yet again, interrupting a birthday party, the Wheeling, W.Va., homemaker took them to court. It took a nasty 16-month fight, but she won an apology and an undisclosed settlement -- including two $500 Sears gift cards to "earn back" her trust.

Ken Jursinski vividly recalls the telemarketer who infuriated him enough to take action. A Florida real estate attorney, Jursinski was putting together a multimillion-dollar international deal in 1994 to feed starving children in Bosnia. Preparing for an important conference call, he had a colleague in Europe on one line and was expecting another party to call any moment.

"My secretary told me, 'You got a call.' And here it was a telemarketer selling stocks and bonds," says Jursinski. "I told him I wasn't interested. The guy kept going. I said, 'Excuse me, sir, I've got Europe on hold.' And he said, 'Well, that's what the hold button is for!' "

Jursinski was fuming. He vowed to invent something to undermine telemarketers.

Bob Bulmash was two years out of law school when telemarketers angered him so much he changed careers. It happened in 1986, before any laws regulated telemarketing. Irritated by the recorded sales messages invading his Illinois home, he complained to his telephone company, Ameritech. It sent a brochure titled "Annoying Calls: What We Can Do," which instructed consumers to just say no.

Soon afterward, Bulmash came across a telemarketer training manual published by Ameritech. Titled "Making Cold Calls: How to Keep From Freezing," it instructed would-be telemarketers that "no means almost yes." Bulmash was outraged. Within two years, he started an organization to do something about it.

Credit the meteoric rise of telemarketing over the past decade for turning private grousing into public backlash. The explosion in sales calls, plus technology that makes it all the moreinvasive, has motivated people who were once content to say no and hang up instead to file lawsuits, establish public-interest organizations, lobby for tougher laws, invent gadgetry and publish stop-telemarketing Web sites -- thousands of them. The result: a cottage industry of anti-telemarketing activists.

Their missions vary, leaning toward pro-privacy agendas rather than anti-business. But most want to stop abusive telemarketing practices and eliminate sales calls for anyone who doesn't want to be called.

This raises the question: Who wants to be called by a telemarketer?

"This industry exists only because consumers use it," says G.M. Mattingley, director of government affairs for the American Teleservices Association, the District-based trade association that represents telemarketers. "If there were no market, no profits, nobody making purchases by phone, then this industry would have dried up and blown away years ago."

Forgive him if he sounds defensive -- but he is. Mattingley says he'll be the first to admit that telemarketing suffers from a "perception challenge." But, he says, the public's image contradicts the economic reality of an industry that claims to have 5.7 million employees who ring up 180 million transactions and what it says are $660 billion in annual sales (both inbound and outbound calls). "The reality is it's a booming market that people by the tens of millions use," he says.

Mattingley says slamming telemarketing "because it is annoying to an unspecified and unidentified number of people" isn't right. Neither, for that matter, he says, is the Federal Trade Commission's proposed national "do not call" registry.

Current federal law requires that when telemarketers make sales calls, they state their name, the company they represent, that they are calling to sell something, and how they can be reached if the consumer wants to cancel the order or complain. The rules forbid calling residences before 8 a.m. or after 9 p.m. And telemarketing firms must maintain a do-not-call list of those consumers who ask to be added to it. Anyone who documents telemarketers violating these rules can take legal action.

Mattingley argues those federal rules are adequate. He says the industry has tried to live up to them. "And what's our reward for these good deeds? We get hammered with a 145-page extravaganza proposal to place further restrictions on the industry on the basis not of wrongdoing but that we are annoying."

But annoying isn't the full extent of it, according to Mey. After she quit her medical transcriber job in 1998 to raise three teenage sons, she couldn't stop noticing the steady stream of daytime intrusions. "I wanted to continue my parents' tradition of everyone sitting down to dinner together to talk about our day," says Mey. "We found ourselves increasingly competing for this time with telemarketers."

Since then, she has juggled family life with her new avocation: "accidental consumer advocate," trying to raise public awareness of the little-used federal and state laws on telemarketing.

Last year, do-not-call legislation similar to laws in 26 other states was on the line in West Virginia, Mey's home state. She spent months stumping for support, faxing editorials to newspapers and traveling to the capital to testify. When the bill died in committee, she figured the battle was lost but not the war.

Now, while helping her oldest son apply for college scholarships, finishing her own college degree in consumer law, and keeping tabs on her three pending telemarketer cases, she does radio and TV interviews, speaks to civic groups and testifies before state and federal agencies and legislatures. Her testimony is footnoted throughout FTC reports, and she may appear in June at the FTC's public-comment hearing on the "do not call" registry. What would she like to see? Instead of a do-not-call list, a list of those people who want telemarketers to call them.

The Erin Brockovich of the do-not-call laws, Mey also has created a Web site (dianamey.com) to guide laymen on how to take telemarketers to court. Her site links to a dozen other Web sites, such as Junkbusters.com, Karen's Koncepts and Bulmash's Private-Citizen.com, which give advice, clarify rights and sell gizmos that block calls.

Other Web sites are less serious. Tom Mabe's colorful "Revenge on the Telemarketers" site, tommabe.com, sells anti-telemarketer T-shirts, caps and comedy CDs of the Louisville prankster torturing actual cold-callers. One of his pranks: A carpet cleaner salesman calls and Mabe screams, "Can you get blood out of carpet? . . . I'll pay you cash. The law says someone breaks into your house, it's okay to shoot them." His first CD sold 50,000 copies.

And there's Vince Nestico, a suburban Detroit draftsman who six years ago created antitelemarketer.com. It opens with a animation of what Nestico calls "a Taliban guy getting bombarded" by telemarketing calls.

"I have received thousands of e-mails from frustrated people from all over the globe, a few here and there from telemarketers themselves defending the practice, and telemarketers that have quit their job after seeing what their practice is doing to other people," says Nestico. "I even occasionally get a few e-mails from people that want to know how to get more calls, so that they can use the Telemarketer Tormenting Techniques from the Web site."

Bulmash has seen the anti-telemarketing movement progress from a laughing matter to a national offensive since he first sued water-softener telemarketers in small-claims court for $11 in 1986. The case: They wouldn't stop calling, despite his requests. One salesman even told him if he didn't want sales calls, he should take his name out of the telephone book. The judge told the company never to call Bulmash again and awarded him the $11 to get an unlisted phone number.

Next, Bulmash wrote to Sears, one of his frequent tele-suitors, and said, "If you want to use my telephone, it's available for $100 per call." He threatened to take Sears to court if it didn't pay the money. "They sent me a check for $100," Bulmash recalls. And "Sears stopped calling."

By 1988, he had started Private Citizen in Napersville, Ill. Using Bulmash's homespun do-not-call tactic, it was the first organization to target the telemarketing epidemic. Today it has 4,000 members. Each pays $20 to have his or her name listed in the Private Citizen Directory, which Bulmash sends to 1,700 "junk call" firms and phone-list sellers. He warns them that using his members' time and telephones to solicit costs $500 per call. Members get a list of the firms that are sent the directory. If any call, then refuse to pay the $500, members can sue.

Sounds silly? Private Citizen members have collected more than $1 million since 1996, says Bulmash.

He says the turning point for the anti-telemarketing movement was "predictive dialing." When most of thetelemarketing industry switched to computerized dialing in the mid-'90s, the numbers called multiplied. While no one has tracked the average number of calls per household, complaints have soared.

"Here were the respectable engines of American commerce -- the AT&Ts, Citibanks and Chase Manhattans -- suddenly setting up machines to call you at home, and if they're not ready to talk to you when you answer, they hang up on you," says Bulmash, explaining that predictive dialers hang up on 5 to 40 percent of the calls they make, depending on how a company sets them.

"That turned this little cottage industry into a small-time General Motors" with anti-telemarketing products now sold by "the regional Bells, Radio Shack and Best Buy."

One of the first anti-telemarketing products to emerge was the TeleZapper, which began selling last August. The $49 device, which plugs into a phone jack, is designed to outsmart predictive-dialing computers. When you answer a call, it emits the same tone as a disconnected line. The computer mistakes it for a disconnect and adds your phone number to its scratch list.

Other products screen incoming calls, and some deliver a recorded "do not call" message. The $119 PreFone Filter issues a businesslike recorded message before your phone even rings, telling callers they aren't welcome if they're selling something -- and telling other callers, friends and relatives that they are welcome.

Even telephone companies sell anti-telemarketing technology and services, though they are telemarketers themselves and they sell equipment to telemarketers to hide Caller IDs.

Many anti-telemarketers say the Caller ID service, at $5 to $7 a month, is the first line of defense against "anonymous" telemarketing calls. For another $8 a month, Call Intercept automatically sends those unidentified calls to a message that says, "The number you are calling has Call Intercept. Please state your name."

Ken Jursinski's Phone Butler, which looks like a telephone jack but is crammed with 98 computer parts and microprocessors, offers a gentle rejection of telemarketers. "Some people don't want to hang up. They're too polite," says Jursinski at his home office in Pensacola, Fla. "But this little nice guy will take over for you and get rid of them."

The Phone Butler is programmed so that when you recognize it's a telemarketer calling, you can hit the star key and hang up. That delivers a legally correct message in a British butler's accent: "Pardon me, but this is the Phone Butler. And I have been directed to inform you that this household must respectfully decline your inquiry. Kindly place this number on your do-not-call list." Then he hangs up.

The Phone Butler's marketing breakthrough came last year when QVC, the TV shopping network, invited Jursinski to sell it at a special $24 tag, nearly half price, to its potential audience of 75 million viewers. He says he sold 15,000 to 20,000 during his first six appearances, and is scheduled for six more.

"We've found that telemarketers don't call back to a house with the Phone Butler," he says. "They know it is just a waste of time. If they can't talk to you, they can't get into your wallet."

The anti-telemarketers have proved to be a force to reckon with in technology and in raising a ruckus, says Chris Hoofnagle, legislative counsel at the Washington-based Electronic Privacy Information Center, but less so in powering legislative solutions.

That's where the FTC's latest brainstorm -- the national "do not call" registry would step in. If passed, it could alter the telemarketing landscape. Hoofnagle believes it's a sure bet, but anti-telemarketing voices aren't hopeful.

"There is no chance in hell of it passing," says Mike Sandman of Chicago, inventor of Easy Hang Up and Telemarketer Stopper. "There is too much money being spread around in Washington from the telemarketing people."

Russ Smith, Alexandria-based publisher of Privacy.net and one of the original anti-telemarketing activists, says: "The FTC and [Federal Communications Commission] rules don't get enforced, so more laws or the national list won't matter."

Even if it passes, Americans should not expect to be spared all dinnertime sales calls, Hoofnagle says, explaining that the FTC does not have authority to regulate banks and telephone companies -- two of the biggest telemarketing industries.

And technical difficulties in implementing and enforcing the law might prevent it from being effective. Moreover, that doesn't take into account telemarketing crooks, the $40 billion-a-year fraudulent phoners who don't follow the rules.

Bulmash's fantasy is that the FTC's proposal passes. And, as more Americans sign on to it, those who don't are barraged with calls until they, too, add their names. "And," he says, "telemarketers put themselves out of business."

And so long to anti-telemarketers as well? "I think most anti-telemarketers - myself included -- would be overjoyed," says Mey.

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