PayPal Tells FCC It's Revising User Policy To Prevent Illegal Texts, Robocalls
Amid FCC pressure, PayPal made changes to its user policy to clarify that it will use robocalls and texts to contact customers “for marketing purposes” only when they have provided “express written consent.” The agency recently approved an order and declaratory ruling designed to get tough on companies that violate the Telephone Consumers Protection Act (see 1506180046).
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The FCC said Monday it sent a letter to PayPal June 11 (see 1506110044) on changes to the company’s user agreement, which were to take effect Wednesday. The letter raised concerns over whether the new policy required consumer consent in order to use PayPal services. “We are concerned that these amendments may violate federal laws governing the use of autodialed, prerecorded, and artificial voice calls, including text messages,” said the letter, signed by FCC Enforcement Bureau Chief Travis LeBlanc. “If PayPal plans to make autodialed, prerecorded, or artificial voice calls or text messages to its customers, please be aware that federal law places strict limits on such communications.”
The amended policy doesn't give consumers required notice that they have a right to refuse to consent to calls that require consumer consent from PayPal, its affiliates and its service providers, the letter said. “If PayPal fails to include this required notice and/or fails to allow its users to refuse such consent, we are concerned that consent is in fact a condition of purchase of PayPal's service and thus violates the Telephone Consumer Protection Act and could subject PayPal, its affiliates, and its service providers to penalties of up to $16,000 per call or text message,” LeBlanc wrote.
Monday, PayPal announced a reconsideration of its revised user agreement. PayPal said in a blog post that it didn't live up to its “own standards” for communicating clearly with customers. “To clear up any confusion,” PayPal said, it modified part of the user agreement. “The new language is intended to make it clear that PayPal primarily uses autodialed or prerecorded calls and texts to: Help detect, investigate and protect our customers from fraud; Provide notices to our customers regarding their accounts or account activity; Collect a debt owed to us.”
LeBlanc said that PayPal moved the agreement in the right direction. “The changes to PayPal’s user agreement recognize that its customers are not required to consent to unwanted robocalls or robotexts,” he said in a Monday news release. “It clarifies, rightly, that its customers must provide prior express written consent before the company can call or text them with marketing, and that these customers have a right to revoke their consent to receive robocalls or robotexts at any time.”
“I applaud PayPal for reversing course and recognizing that consumers have the right to say no to intrusive robocalls or robotexts,” Sen. Ed Markey, D-Mass., said in a news release. “I hope this reversal sends a clear message to other companies.” Markey, along with Sens. Al Franken, D-Minn., Ron Wyden, D-Ore., and Robert Menendez, D-N.J., sent a letter to PayPal June 16 raising questions about the change in the company's user policy.
New York Attorney General Eric Schneiderman's office also had raised concerns about the agreement. “Again and again, Americans have demanded that companies stop invasive robocalling to promote their products," Schneiderman said Monday.