7 LONG TITLE
8 General Description:
9 This bill modifies the Telephone and Facsimile Solicitation Act and the Telephone
10 Fraud Prevention Act.
11 Highlighted Provisions:
12 This bill:
13 ▸ modifies the Telephone and Facsimile Solicitation Act definition of "telephone
14 solicitation" to include a telephone solicitation made to encourage a person to sell
15 real or personal property to the solicitor;
16 ▸ prohibits a person from making a telephone solicitation to a cellular phone without
17 prior consent;
18 ▸ amends definitions in the Telephone Fraud Prevention Act (TFPA);
19 ▸ modifies security requirements for a registered seller under the TFPA;
20 ▸ specifies penalties for a seller or solicitor who violates the TFPA;
21 ▸ amends the prohibited practices under the TFPA;
22 ▸ modifies the types of information the Division of Consumer Protection (division) is
23 required to redact from a consumer complaint regarding conduct the division
24 regulates under the TFPA before making the consumer complaint public; and
25 ▸ makes technical and conforming changes.
26 Money Appropriated in this Bill:
28 Other Special Clauses:
30 Utah Code Sections Affected:
32 13-25a-102, as last amended by Laws of Utah 2021, Chapter 289
33 13-25a-103, as last amended by Laws of Utah 2004, Chapters 90 and 263
34 13-26-2, as last amended by Laws of Utah 2012, Chapter 152
35 13-26-3, as last amended by Laws of Utah 2013, Chapter 124
36 13-26-4, as last amended by Laws of Utah 2017, Chapter 98
37 13-26-5, as last amended by Laws of Utah 1994, Chapter 189
38 13-26-8, as last amended by Laws of Utah 2013, Chapter 124
39 13-26-11, as last amended by Laws of Utah 2013, Chapter 124
40 13-26-12, as enacted by Laws of Utah 2015, Chapter 335
42 Be it enacted by the Legislature of the state of Utah:
43 Section 1. Section 13-25a-102 is amended to read:
44 13-25a-102. Definitions.
45 As used in this chapter:
46 (1) "Advertisement" means material offering for sale, or advertising the availability or
47 quality of, any property, [
48 (2) (a) "Automated telephone dialing system" means equipment used to:
49 (i) store or produce telephone numbers;
50 (ii) call a stored or produced number; and
51 (iii) connect the number called with a recorded message or artificial voice.
52 (b) "Automated telephone dialing system" does not include [
54 used in an emergency involving the immediate health or safety of a person[
55 burglar alarm system, voice messaging system, fire alarm system, or other similar system.
56 (3) "Division" means the Division of Consumer Protection [
58 (4) (a) "Established business relationship" means a relationship that:
59 (i) is based on inquiry, application, purchase, or transaction regarding products or
60 services offered;
61 (ii) is formed by a voluntary two-way communication between a person making a
62 telephone solicitation and a person to whom a telephone solicitation is made; and
63 (iii) has not been terminated by:
64 (A) an act by either [
65 (B) the passage of 18 months since the most recent inquiry, application, purchase,
66 transaction, or voluntary two-way communication.
67 (b) "Established business relationship" includes a relationship with an affiliate as
68 defined in Section 16-10a-102.
69 (5) "Facsimile machine" means equipment used for:
70 (a) scanning or encoding text or images for conversion into electronic signals for
71 transmission; or
72 (b) receiving electronic signals and reproducing them as a duplicate of the original text
73 or image.
74 (6) "Negative response" means a statement from a [
75 person does not wish to listen to the sales presentation or participate in the solicitation
76 presented in the telephone call.
77 (7) "On-call emergency provider" means an individual who is required by an employer
78 to be on call to respond to a medical emergency.
79 (8) "Telephone solicitation" means the initiation of a telephone call or message for a
80 commercial purpose or to seek a financial donation, including calls:
81 (a) encouraging the purchase or rental of, or investment in, property, goods, or services,
82 regardless of whether the transaction involves a nonprofit organization;
83 (b) soliciting a sale of or extension of credit for property or services to the person
85 (c) soliciting information that will be used for:
86 (i) the direct solicitation of a sale of property or services to the person called; or
87 (ii) an extension of credit to the person called for a sale of property or services; [
88 (d) soliciting a charitable donation involving the exchange of any premium, prize, gift,
89 ticket, subscription, or other benefit in connection with any appeal made for a charitable
91 (e) encouraging the person called to sell real or personal property.
92 (9) "Telephone solicitor" means any [
93 partnership, association, or corporation who makes or causes to be made an unsolicited
94 telephone call, including calls made by use of an automated telephone dialing system.
95 (10) "Unsolicited telephone call" means a telephone call for a commercial purpose or
96 to seek a financial donation other than a call made:
97 (a) in response to an express request of the person called;
98 (b) primarily in connection with an existing debt or contract, payment or performance
99 of which has not been completed at the time of the call;
100 (c) to [
101 relationship; or
102 (d) as required by law for a medical purpose.
103 Section 2. Section 13-25a-103 is amended to read:
104 13-25a-103. Prohibited conduct for telephone solicitations -- Exceptions.
105 (1) Except as provided in Subsection (2), a person may not operate or authorize the
106 operation of an automated telephone dialing system to make a telephone solicitation.
107 (2) A person may operate an automated telephone dialing system if a call is made:
108 (a) with the prior express consent of the person who is called agreeing to receive a
109 telephone solicitation from a specific solicitor; or
110 (b) to a person with whom the solicitor has an established business relationship.
111 (3) A person may not make a telephone solicitation to a residential telephone or
112 cellular telephone without prior express consent during any of the following times:
113 (a) [
114 (b) on a Sunday; or
115 (c) on a legal holiday.
116 (4) A person may not make or authorize a telephone solicitation in violation of Title 47
117 U.S.C. 227.
118 (5) [
119 number shall:
120 (a) identify the telephone solicitor;
121 (b) identify the business on whose behalf the telephone solicitor is soliciting;
122 (c) promptly identify the purpose of the call [
123 telephone with the person who is the object of the telephone solicitation;
124 (d) discontinue the solicitation if the person being solicited gives a negative response at
125 any time during the telephone call; and
126 (e) hang up the phone, or in the case of an automated telephone dialing system
127 operator, disconnect the automated telephone dialing system from the telephone line within 25
128 seconds of the termination of the call by the person being called.
129 (6) [
130 telephone solicitor's telephone number through a caller identification service, the telephone
131 solicitor may not withhold the display of the telephone solicitor's telephone number from a
132 caller identification service when that number is being used for telemarketing purposes [
135 Section 3. Section 13-26-2 is amended to read:
136 13-26-2. Definitions.
137 As used in this chapter, unless the context otherwise requires:
138 (1) "Affiliated person" means a seller or a seller's contractor, director, employee,
139 officer, owner, or partner.
141 buyer, at regular intervals of similar special-interest products[
149 ordinary intelligence or prudence would consider important in deciding whether [
150 accept an offer extended through a telephone solicitation.
151 (6) "Participant" means a person seeking to register or renew a registration as a seller
153 (a) a seller;
154 (b) an owner;
155 (c) an officer;
156 (d) a director;
157 (e) a member or manager of a limited liability company;
158 (f) a principal;
159 (g) a trustee;
160 (h) a general or limited partner;
161 (i) a sole proprietor; or
162 (j) an individual with a controlling interest in an entity.
164 which a prospective purchaser is given a right, chance, or privilege to purchase or receive
165 goods or services with a stated or represented value of $25 or more as an inducement to a
166 prospective purchaser to purchase other goods or services.
167 (8) "Seller" means a person, or a group of persons engaged in a common effort to
168 conduct a telephone solicitation, that:
169 (a) on behalf of the person, or the group of persons engaged in a common effort to
170 conduct a telephone solicitation:
171 (i) makes a telephone solicitation; or
172 (ii) causes a telephone solicitation to be made; or
173 (b) through a telephone solicitor:
174 (i) makes a telephone solicitation; or
175 (ii) causes a telephone solicitation to be made.
177 and "series arrangements" mean products or services provided, with the prior express request or
178 consent of the buyer, for a specified period of time at a price dependent on the duration of
179 service and to complement an initial purchase.
181 (i) a sale or solicitation of goods or services in which:
182 (A) (I) the seller solicits the sale over the telephone;
183 (II) the purchaser's agreement to purchase is made over the telephone; and
184 (III) the purchaser, over the telephone, pays for or agrees to commit to payment for
185 goods or services prior to or upon receipt by the purchaser of the goods or services;
186 (B) the [
187 purchaser over the telephone, to make and keep an appointment that directly results in the
188 purchase of goods or services by the purchaser that would not have occurred without the
189 telephone solicitation and inducement by the [
190 (C) the seller offers or promises a premium to a prospective purchaser if:
191 (I) the seller induces the prospective purchaser to initiate a telephone contact with the
193 (II) the resulting solicitation meets the requirements of Subsection [
194 (D) the [
195 premium, prize, gift, ticket, subscription, or other benefit in connection with [
196 made for a charitable purpose by an organization that is not otherwise exempt under Subsection
197 13-26-4(2)(b)(iv); or
198 (ii) a telephone solicitation as defined in Section 13-25a-102.
199 (b) "Telephone solicitation," "sale," "selling," or "solicitation of sale" does not include
200 a sale or solicitation that occurs solely through an Internet website without the use of a
201 telephone call.
202 (c) A solicitation of sale or telephone solicitation is considered complete when made,
203 whether or not the person receiving the solicitation agrees to the sale or to make a charitable
210 solicitation on behalf of a seller.
213 Section 4. Section 13-26-3 is amended to read:
214 13-26-3. Registration and bond required.
215 (1) (a) Unless exempt under Section 13-26-4, each [
216 seller shall register annually with the division before engaging in telephone solicitations if:
217 (i) the [
218 (A) originate in Utah; or
219 (B) are received in Utah; or
220 (ii) the [
221 conducts any business operations in Utah.
222 (b) The registration form shall designate an agent residing in this state who is
223 authorized by the [
224 action brought by this state or a resident of this state.
225 (c) If a [
226 service or fails to appoint a successor to the agent, the division shall:
227 (i) [
230 (ii) if the application is for a renewal registration, suspend the seller's current
231 registration until the seller designates an agent.
232 (d) [
234 in the form of:
235 (i) a valid Utah driver license;
236 (ii) a valid governmental photo identification issued to a resident of this state; or
237 (iii) other verifiable identification indicating residency in this state.
241 (2) The division may impose an annual registration fee set [
242 with Section 63J-1-504 that may include the cost of the criminal background check described
243 in Subsection (4).
244 (3) (a) Each [
245 telephone solicitation or sales in this state shall obtain and maintain the following security:
246 (i) a performance bond issued by a surety authorized to transact surety business in this
248 (ii) an irrevocable letter of credit issued by a financial institution authorized [
249 under the laws of this state or the United States doing business in this state; or
250 (iii) a certificate of deposit held in this state in a [
252 or the United States to accept deposits from the public.
253 (b) [
254 division for the benefit of any consumer who incurs damages as the result of [
256 (c) [
257 from the bond, letter of credit, or certificate of deposit administrative fines, civil penalties,
258 investigative costs, attorney fees, and other costs of collecting and distributing funds under this
259 section [
261 (d) A [
262 letter of credit in force for one year after [
263 writing that [
264 (e) The [
265 letter of credit, or certificate of deposit [
266 (i) $25,000 if:
267 (A) neither the [
268 violated this chapter [
269 period immediately before the day on which the seller files the application; and
270 (B) the [
271 (ii) $50,000 if:
272 (A) neither the [
273 violated this chapter [
274 period immediately before the day on which the seller files the application; and
275 (B) the [
276 (iii) $75,000 if the [
277 violated this chapter [
278 period immediately before the day on which the seller files the application.
290 (4) To register or renew a registration as a seller, a participant:
291 (a) may not have been convicted of a felony in the 10-year period immediately before
292 the day on which the participant files the application;
293 (b) may not have been convicted of a misdemeanor involving moral turpitude,
294 including theft, fraud, or dishonesty, in the 10-year period immediately before the day on which
295 the participant files the application; and
298 of a criminal background check; and
300 Identification created in Section 53-10-201.
301 (5) [
302 Act, the division may establish by rule the registration requirements for [
306 (6) If information in an application for registration or for renewal of registration as a
308 the applicant shall, within 30 days after the day on which information changes or becomes
309 incorrect or incomplete, [
310 division in a manner that the division establishes by rule.
311 (7) The division director may deny or revoke a registration under this section for any
312 violation of this chapter.
313 Section 5. Section 13-26-4 is amended to read:
314 13-26-4. Exemptions from registration.
315 (1) In [
316 exemption has the burden of proving that the person is entitled to the exemption.
317 (2) The following are exempt from [
318 requirements [
319 (a) a broker, agent, dealer, or sales professional licensed [
320 in this state, when soliciting sales within the scope of [
321 sales professional's license;
322 (b) the solicitation of sales by:
323 (i) a public utility that is regulated under Title 54, Public Utilities, or by an affiliate of
324 the public utility;
325 (ii) a newspaper of general circulation;
326 (iii) a solicitation of [
327 federal authority;
328 (iv) a nonprofit organization if no part of the net earnings from the sale inures to the
329 benefit of [
330 (A) a member, officer, trustee, or serving board member of the organization[
331 (B) an individual, or a family member of an individual, holding a position of authority
332 or trust in the organization; and
333 (v) a person who periodically publishes and delivers a catalog of the [
334 merchandise to prospective purchasers, if the catalog:
335 (A) contains the price and a written description or illustration of each item offered for
337 (B) includes the seller's business address [
338 (C) includes at least 24 pages of written material and illustrations;
339 (D) is distributed in more than one state; and
340 (E) has an annual circulation by mailing of not less than 250,000;
341 (c) [
342 and Exchange Commission, or [
343 (d) the solicitation of [
344 subsidiary of a depository institution, personal property broker, securities broker, investment
345 adviser, consumer finance lender, or insurer subject to regulation by an official agency of this
346 state or the United States;
347 (e) the solicitation by a person soliciting only the sale of telephone services to be
348 provided by the person or the person's employer;
349 (f) the solicitation of a person relating to a transaction regulated by the Commodities
350 Futures Trading Commission, if:
351 (i) the person is registered with or temporarily licensed by the commission to conduct
353 (ii) the registration or license has not expired or been suspended or revoked;
354 (g) the solicitation of a contract for the maintenance or repair of goods previously
355 purchased from the person:
356 (i) who is making the solicitation; or
357 (ii) on whose behalf the solicitation is made;
358 (h) the solicitation of previous customers of the [
359 call is made if the person making the call:
360 (i) does not offer any premium in conjunction with a sale or offer;
361 (ii) is not selling an investment or an opportunity for an investment that is not
362 registered with [
363 (iii) is not regularly engaged in telephone sales;
364 (i) the solicitation of a sale that is an isolated transaction and not done in the course of
365 a pattern of repeated transactions of a [
366 (j) the solicitation of a person by a retail business [
367 operation for at least five years in Utah under the same name as that used in connection with
368 telemarketing if [
371 (i) at the retail business's place of business, the retail business:
372 (A) displays and offers products for sale; or
373 (B) offers services for sale and provides the services at the place of business; and
374 (ii) a majority of the [
377 (k) a person primarily soliciting the sale of a magazine or periodical sold by the
378 publisher or the publisher's agent through a written agreement, or printed or recorded material
379 through a contractual plan, such as a book or record club, continuity plan, subscription,
380 standing order arrangement, or supplement or series arrangement if:
381 (i) the [
382 instruct the [
383 regulated by the Federal Trade Commission trade regulation concerning use of negative option
384 plans by [
385 (ii) (A) the [
386 consented in advance to receive the merchandise on a periodic basis; and
387 (B) the consumer retains the right to cancel at any time and receive a full refund for the
388 unused portion;
389 (l) a telephone marketing service company that provides telemarketing sales services
390 under contract to [
391 (i) [
392 with customers in Utah for at least five years under the same business name and with [
393 telephone marketing service company's principal office in the same location;
394 (ii) at least 75% of [
395 performed on behalf of persons [
396 (iii) neither the telephone marketing service company nor [
397 service company's principals have been enjoined from doing business or subjected to criminal
398 actions for [
399 company's principal's business activities in this or any other state;
400 (m) a credit services organization that holds a current registration with the division
401 under Chapter 21, Credit Services Organizations Act, if the credit services organization's
402 telephone solicitations are limited to the solicitation of services regulated under Chapter 21,
403 Credit Services Organizations Act; and
404 (n) a provider that holds a current registration with the division under Chapter 42,
405 Uniform Debt-Management Services Act, if the provider's telephone solicitations are limited to
406 the solicitation of services regulated under [
407 Chapter 42, Uniform Debt-Management Services Act.
408 Section 6. Section 13-26-5 is amended to read:
409 13-26-5. Right of rescission -- Cancellation.
410 (1) As used in this section, "business day" means a day other than Sunday or a federal
411 or state holiday.
413 right to otherwise revoke an offer, a person [
416 receives the merchandise or premium, whichever is later, provided the seller or the seller's
417 solicitor advises the purchaser of [
418 the time [
419 (b) If the seller or the seller's solicitor [
420 fails to orally advise a purchaser of the right to cancel under this section at the time of [
421 solicitation, the purchaser's right to cancel [
422 (c) If the seller or the seller's solicitor [
423 to orally advise a purchaser of [
424 telephone number, and complete [
425 purchaser may cancel the sale at any time.
426 (d) Except as provided in Subsection (5), a seller shall provide a full refund to a
427 purchaser who cancels a sale in accordance with this section.
429 (3) A purchaser may cancel a sale by:
430 (a) mailing a notice of cancellation to the [
432 (b) if the [
433 the purchaser with the seller's or the seller's solicitor's correct [
444 (4) (a) If a purchaser cancels a sale and the seller or the seller's solicitor provides the
445 purchaser with the seller's correct address, the purchaser shall, within seven business days after
446 the day on which the purchaser exercises the right to cancel, make a reasonable attempt to:
447 (i) if the canceled sale involves durable goods, return the goods to the seller; or
448 (ii) if the canceled sale involves expendable goods, return any unused portion of the
449 goods to the seller.
450 (b) If the seller or the seller's solicitor fails to provide to a purchaser the seller's correct
451 address, a purchaser who cancels a sale is not required to return any canceled goods to the
454 goods purchased, the [
457 (b) A seller may deduct the reasonable allowance described in Subsection (5)(a) from
458 any refund due the purchaser.
463 Section 7. Section 13-26-8 is amended to read:
464 13-26-8. Penalties.
479 (1) (a) A seller or solicitor who violates a provision of this chapter is guilty of:
480 (i) a class B misdemeanor for a first violation;
481 (ii) if the seller or solicitor has one prior violation of this chapter, a class A
482 misdemeanor; and
483 (iii) if the seller or solicitor has two prior violations of this chapter, a third-degree
485 (b) For the purposes of Subsection (1)(a), a prior violation includes:
486 (i) a final prior conviction;
487 (ii) a final determination by a court of competent jurisdiction; or
488 (iii) a final determination in an administrative adjudicative proceeding.
489 (2) [
492 subject to a civil penalty in a court of competent jurisdiction [
493 for each [
494 (3) (a) The division may:
495 (i) in accordance with Title 63G, Chapter 4, Administrative Procedures Act, conduct an
496 administrative proceeding to enforce the provisions of this chapter;
497 (ii) bring a court action to enforce the provisions of this chapter; and
498 (iii) in addition to other penalties described in this chapter, issue a cease and desist
499 order and impose an administrative fine of up to $2,500 for each violation of this chapter.
500 (b) For purposes of this section, each telephone solicitation made in violation of this
501 chapter is a separate violation.
502 (4) The division shall deposit all administrative fines and civil penalties collected
503 under this chapter into the Consumer Protection Education and Training Fund created in
504 Section 13-2-8.
505 Section 8. Section 13-26-11 is amended to read:
506 13-26-11. Prohibited practices.
507 (1) It is unlawful for [
508 (a) [
513 make or cause to be made [
514 fact necessary to make [
517 or prospective purchaser about [
520 the right to cancel under Section 13-26-5; [
522 purchaser of the purchaser's right to cancel under Section 13-26-5 [
530 (f) employ an inmate in a correctional facility for telephone soliciting operations when
531 the employment would give the inmate access to an individual's personal data, including the
532 individual's name, address, telephone number, Social Security number, credit card information,
533 or physical description; or
534 (g) cause or permit a solicitor to violate a provision of this chapter.
535 (2) It is unlawful for a solicitor to:
536 (a) use a fictitious personal name in connection with a telephone solicitation;
537 (b) in connection with a telephone solicitation, make or cause to be made a false
538 material statement or fail to disclose a material fact necessary to make the solicitor's statement
539 not misleading;
540 (c) make a misrepresentation to a purchaser or prospective purchaser about the
541 solicitor's compliance with this chapter; or
542 (d) unless the solicitor is exempt under Section 13-26-4, fail to orally advise a
543 purchaser of the purchaser's right to cancel under Section 13-26-5.
544 (3) If a person knows or has reason to know that a seller or solicitor is engaged in an
545 act or practice that violates this chapter, it is unlawful for the person to:
546 (a) benefit from the seller's or solicitor's services; or
547 (b) provide substantial assistance or support to the seller or solicitor.
548 Section 9. Section 13-26-12 is amended to read:
549 13-26-12. Consumer complaints are public.
550 (1) As used in this section, "consumer complaint" means a complaint that:
552 (a) a person files with the division;
553 (b) alleges facts relating to conduct that the division regulates under this chapter; and
554 (c) (i) alleges a loss to the [
555 (1)(a) of $3,500 or more; or
556 (ii) is one of at least 50 [
557 (A) against the same person [
558 (B) during the [
559 period immediately before the day on which the person described in Subsection (1)(a) files the
561 (2) For purposes of determining the number of complaints against the same person
562 under Subsection (1)(c)(ii)(A), the division may consider complaints filed against multiple
563 corporations, limited liability companies, partnerships, or other business entities under
564 common ownership to be complaints against the same person.
565 (3) Notwithstanding Subsection 13-11-7(2) and subject to Subsections (4) and (5), a
566 consumer complaint:
567 (a) is a public record; and
568 (b) may not be classified as a private, controlled, or protected record under Title 63G,
569 Chapter 2, Government Records Access and Management Act.
570 (4) Subsection (3) does not apply to a consumer complaint:
574 (a) that is nonmeritorious, beginning the day on which:
575 (i) the division determines through an administrative proceeding that the consumer
576 complaint is nonmeritorious; or
577 (ii) a court of competent jurisdiction finds the consumer complaint nonmeritorious; or
578 (b) that [
579 which the person files the consumer complaint.
580 (5) Before making a consumer complaint that is subject to Subsection (3) or a response
581 described in Subsection (6) available to the public, the division:
582 (a) shall redact from the consumer complaint or response any information that would
583 disclose [
585 (i) the filer's:
586 (A) address;
587 (B) Social Security number;
588 (C) bank account information;
589 (D) email address; or
590 (E) telephone number; or
591 (ii) information similar in nature to the information described in Subsection (5)(a)(i);
593 (b) may redact the name of the [
594 that could, in the division's judgment, disclose the identity of the [
595 filing the consumer complaint.
596 (6) A person's initial, written response to a consumer complaint that is subject to
597 Subsection [