The Federal Trade Commission (FTC) has announced a significant expansion of a rule cracking down on abusive telemarketing practices in a bid to protect older Americans, who are the most common victims of technical support scams.
The move was prompted by the agency’s determination that many scams trick customers into calling fake tech support hotlines where fraudsters demand payments to solve non-existent problems or try to steal sensitive information from customers.
The agency noted that the type of fraudulent practices that the new rule cracks down on are part of a series of tech support scams that led to over $175 million in losses among customers aged 60 and older in 2023.
“The Commission will not sit idle as older consumers continue to report tech support scams as a leading driver of fraud losses,” Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said in a statement. “Expanding the TSR to make sure calls for tech support services are covered will help us hold businesses accountable and get money back for injured consumers.”
The amendments extend the TSR’s protections to inbound telemarketing calls for technical support services. This includes situations where consumers are lured into calling companies through deceptive pop-ups or advertisements claiming their devices have been infected with malware or have otherwise been compromised. Using fear tactics, scammers then try to sell unnecessary services to fix fabricated problems or gain access to personal information.
Under the updated rule, technical support services are defined as “any plan, program, software, or service marketed to repair, maintain, or improve the performance or security of any device on which code can be downloaded, installed, or run.” This definition encompasses computers, smartphones, tablets, and smart home devices.
Additionally, the rule excludes inbound calls for tech support services from certain TSR exemptions, such as those related to direct response advertisements or mail solicitations.
“I dissent from this rulemaking not because it is bad policy, but because the time for rulemaking by the Biden-Harris FTC is over,” Ferguson wrote in his dissent.
“The proper role of this lame-duck Commission is not to announce new policies, but to hold down the fort, conduct routine law enforcement, and provide for an orderly transition to the Trump Administration. I will vote against all new rules not required by statute, and any enforcement action that advances an unprecedented theory of liability until that transition is complete.”
Most of the provisions of the final rule will become effective 60 days after being published in the Federal Register.
