• Misrepresenting the material terms of a seller's refund, cancellation, exchange, repurchase or warranty policies.
• Misrepresenting that a seller is offering consumer goods or services free of charge or at a reduced price.
• Misrepresenting that a seller is affiliated with, or endorsed by, any government or 3rd-party organization.
• Misrepresenting that a seller has specially selected the consumer, or misrepresenting the basis on which a consumer has been selected.
• Misrepresenting any material aspect of an investment opportunity, including risk, liquidity, earnings potential or profitability.
• Failing to disclose, in connection with every purported offer of free goods or services in a home solicitation transaction, any costs which the consumer must incur and any conditions which the consumer must meet in order to receive those free goods or services.
• Making any other false, deceptive or misleading representation to a consumer.
Prohibited Practices; General
This rule prohibits a seller from doing any of the following in a home solicitation transaction:
• Threatening, intimidating or harassing a consumer.
• Failing to leave a consumer's premises upon request.
• Requesting or receiving payment for "credit repair" services until the seller provides the consumer with all of the following:
*All of the "credit repair services" for which the seller is requesting or receiving payment.
*A consumer report, from a bona fide consumer reporting agency, which demonstrates that the "credit repair services" have achieved all of the results promised to the consumer.
• Requesting or receiving payment for helping a consumer recover money lost in a prior home solicitation transaction until at least 7 days after that consumer recovers that money. (This provision addresses so-called "recovery room" schemes, which prey on previously victimized consumers.)
• Requesting or receiving payment for "loan finder" services until the consumer actually receives the promised loan.
Fiscal Estimate
Assumptions Used in Arriving at Fiscal Estimate
This rule updates and modernizes existing rules related to home solicitation selling. It also harmonizes state regulations with federal telemarketing rules. The revised rule requires information be given to consumers who are solicited away from regular business establishments about the product, costs, and identity of seller. The bill also prohibits certain deceptive practices.
The department already handles over 4,000 complaints annually from consumers about transactions which are initiated or consummated away from the sellers regular place of business. It is assumed that the number of complaints will not increase due to this revision. It is also assumed that this law will assist department staff by providing clearer definitions which, when applied, will enhance our efficiency in dealing with these problems.
Based on these assumptions, the department believes there is no fiscal effect associated with amendment of this rule.
Initial Regulatory Flexibility Analysis
Proposed ch. ATCP 127, Wis. Adm. Code
Home Solicitation Selling
This rule regulates businesses that solicit and sell consumer goods by mail, telephone, or other means away from a regular place of business. The rule provides methods whereby buyers can be informed of the conditions of their agreements in a manner that is meaningful and available to the consumer after the transaction is done and the seller is no longer at the same location.
These requirements should have little if any impact on small business. It is general business practice to inform potential customers who you are and the product you are selling and to produce invoices following the sale. It is also general practice to retain business records for a period of time for tax and other purposes. The practices regulated by the prize promotion, unauthorized payment, telephone solicitation, and credit card laundering sections have been identified at federal rules hearings as practices which have lead to abuse of consumers and are already in effect for any business that solicits on an interstate scale. Businesses recordkeeping requirements are necessary for meaningful enforcement of the rules and should be already the norm for most businesses.
Scope
This rule is based, in part, on Federal Trade Commission telemarketing rules yet also protects consumers in intrastate transactions, direct mail, door-to-door, and electronic sales.
This rule does not apply to sales at a regular place of business, catalog sales, mass advertising, business to business sales, financial institutions, utilities, and real estate sales.
Opening Disclosures
This rule requires initial disclosures such as the seller's correct name, the name of the individual making the solicitation, the fact that the seller is offering or promoting a sale of goods or services, and the kind of goods or services the seller is offering or promoting.
These disclosures must be made orally, if the home solicitation involves an oral or face-to-face communication and in writing, if the home solicitation involves a written or face-to-face solicitation.
These requirements should have no significant impact on small business. Most sellers prefer to leave written information about their company and products with the consumer already.
Disclosures Prior to Sale
Before the sale or acceptance of payment a seller must disclose all of the following; the nature, quantity, cost, and material terms and conditions affecting the sale, receipt or use of the goods or services, and the seller's policy related to refunds, cancellations and exchanges.
These requirements add no additional cost to legitimate small business who already provide this information to consumers in part to protect themselves from excessive customer dissatisfaction.
Prize Promotions
This rule regulates sweepstakes and other prize promotions. Sellers who use these promotions may not require any purchase or payment as a condition to entry. A seller must also disclose the verifiable retail value of each offered prize, the odds of receiving each offered prize, instructions on how to participate without making a purchase or payment, all actions which the consumer must take, and all conditions which the consumer must meet. This rule also prohibits any seller from misrepresenting the material terms of a prize promotion.
This requirement reflects conditions contained in Wisconsin's lottery and selling with pretense of a prize laws. It should have no fiscal impact on small business.
Unauthorized Payment
Under this rule, no seller may obtain or submit any negotiable instrument drawn on a consumer's account without express, verifiable authorization. Authorizations may be written or oral and must be verifiable by writing or tape recording.
This section may require businesses who currently do not have the facility to tape record oral authorizations to make a one time purchase of necessary equipment.
Credit Card Laundering
This rule prohibits "credit card laundering" schemes by which unscrupulous sellers gain access to the credit card system by processing credit card transactions under the name of another merchant.
This section targets only those sellers engaged in unscrupulous practices and should have no impact on legitimate small business.
Misrepresentations
This rule prohibits misrepresentation including:
The seller's identity, affiliation, location or characteristics or the nature, purpose or intended length of a home solicitation.
The cost, nature or terms including restrictions, limitations or conditions on the purchase, receipt, use or return of goods or services or any document related to that transaction. Failing to disclose is also prohibited.
The nature, quantity, or material characteristics of the goods or services.
That a seller is affiliated with, or endorsed by, any government or 3rd-party organization or has specially selected the consumer.
Any material aspect of an investment opportunity, including risk, liquidity, earnings potential or profitability.
Prohibited Practices; General
This rule prohibits a seller from doing any of the following in a home solicitation transaction:
Threatening, intimidating, harassing, or failing to leave a consumer's premises upon request.
Requesting or receiving payment for "credit repair" services until the consumer receives the "credit repair services" verified by a consumer report, from a consumer reporting agency, demonstrating all of the results promised to the consumer.
Requesting or receiving payment for helping a consumer recover money lost in a prior home solicitation transaction until at least 7 days after that consumer recovers that money.
Requesting or receiving payment for "loan finder" services until the consumer actually receives the promised loan.
Prohibited Telephone Solicitation Practices
This rule prohibits a home solicitation seller from doing any of the following:
Initiating a telephone solicitation to a consumer who has previously stated that he or she does not wish to receive telephone solicitations from the seller.
Repeatedly causing a consumer's telephone to ring, or repeatedly engaging a consumer in telephone conversation, with intent to annoy, abuse or harass a consumer.
Initiating a telephone solicitation before 8:00 AM or after 9:00 PM without the prior consent.
Recordkeeping
This rule requires a home solicitation seller to keep copies of all solicitation scripts and documents, transaction receipts, a description of each prize offered and the name and address of every consumer who received a prize. The rule also requires a seller to keep the real names, any fictitious name(s) used, address and telephone number, and job title or titles of individual solicitors acting on the seller's behalf.
This section is similar to the federal telemarketing rule requirements. Additionally, the records to be kept are generally held by small business for other purposes. Therefore there should be no fiscal impact to small business.
Assisting Violations
No person may knowingly assist any seller to engage in any activity or practice in violation of this chapter.
Small Business Impact
The impact on small business should be limited to those who are not already marketing under the federal telemarketing rules. Some small businesses may need to purchase equipment to tape record telephone authorizations from consumers. Most other requirements should be covered by practices already common in the business community.
Notice of Hearing
Barbering & Cosmetology Examining Board
Notice is hereby given that pursuant to authority vested in the Barbering and Cosmetology Examining Board in ss. 15.08 (5) (b), 227.11 (2), 454.08 (1) (a) and (4), Stats., and interpreting ss. 454.01, 454.02, 454.04, 454.06, 454.07, 454.08, 454.10, 454.13 and 454.145, Stats., the Barbering and Cosmetology Examining Board will hold a public hearing at the time and place indicated below to consider an order to revise chs. BC 1 to 9, relating to the licensure, examinations and practice of barbering and cosmetology practitioners, managers, manicurists, electrologists, aestheticians and apprentices, and renewal and reinstatement of licenses.
Hearing Information
October 5, 1998 Room 179A
Monday 1400 E. Washington Ave.
10:00 a.m. Madison, WI
Appearances at the Hearing
Interested persons are invited to present information at the hearing. Persons appearing may make an oral presentation but are urged to submit facts, opinions and argument in writing as well. Facts, opinions and argument may also be submitted in writing without a personal appearance by mail addressed to the Department of Regulation and Licensing, Office of Administrative Rules, P.O. Box 8935, Madison, Wisconsin 53708. Written comments must be received by October 12, 1998 to be included in the record of rule-making proceedings.
Analysis prepared by the Department of Regulation and Licensing
Statutes authorizing promulgation: ss. 15.08 (5) (b), 227.11 (2), 454.08 (1) (a) and (4)
Statutes interpreted: ss. 454.01, 454.02, 454.04, 454.06, 454.07, 454.08, 454.10, 454.13 and 454.145
This proposed rule-making order of the Barbering and Cosmetology Examining Board contains amendments which relate to the definitions, the statutory authority, and the form, style, placement, clarity, grammar, punctuation and plain language of the current rules.
Rules are amended to clarify the procedures for safety and sanitation, to include defining levels of disinfection, modifying protocol for disinfecting instruments and standards necessary to protect the public health, safety and welfare. Rules are created relating to the clarification of the roles and responsibilities of the establishment owner and licensed manager for maintaining and providing training and supervision consistent with chapter 454, Stats. Rules are amended to clarify the conditions under which a manager may manage multiple establishments. Rules are revised to clarify the requirements for a basin to wash hands in between clients. Rules are created to identify references for disposing of contaminated paper products and the disposal of sharps. Rules are repealed and recreated to define the apprenticeship program that is consistent with current policy and practice of the board. Rules are amended to clarify the different requirements for applicants from other states seeking licensure in Wisconsin. Rules are revised to clarify the requirements for renewal and reinstatement.
Text of Rule
SECTION 1. BC 1.01 (1) is renumbered BC 1.01 (1a).
