HB0728ham001 96TH GENERAL ASSEMBLY

Consumer Protection Committee

Filed: 3/10/2009

09600HB0728ham001 LRB096 04149 MJR 23120 a

AMENDMENT TO HOUSE BILL 728

AMENDMENT NO. ______. Amend House Bill 728 by replacing everything after the enacting clause with the following:

"Section 1. Short title. This Act may be cited as the Calling Card Consumer Protection Act.

Section 5. Findings. The General Assembly finds that:

(1) the prepaid telephone calling card industry in the United States is plagued by fraudulent and deceptive business practices; and

(2) the necessary protections relating to prepaid telephone calling cards must ensure that all advertising is truthful, accurate, and reasonably discloses the terms and conditions of prepaid telephone calling cards and prepaid telephone calling services.

Section 10. Definitions. As used in this Act:

"Prepaid telephone calling service provider" means any entity, corporation, company, association, firm, partnership, or person providing prepaid telephone calling service to the public using its own, or a resold telecommunications network or voice over Internet technology.

"Prepaid telephone calling service" or "service" means any prepaid telecommunications service that allows consumers to originate calls through a local, long distance, or toll-free access number and authorization code, whether manually or electronically dialed. "Prepaid telephone calling service" or "service" does not include any service that provides access to a wireless telecommunications service account wherein the purchaser has a pre-existing relationship with the wireless service provider or establishes a carrier-customer relationship via the purchase of the object.

"Prepaid telephone calling card" or "card" means any right of use purchased for a sum certain that contains an access number and authorization code that enables a consumer to use a prepaid telephone calling service. The rights of use may be embodied on a card or other physical object or may be purchased by an electronic or telephonic means through which the purchaser obtains access numbers and authorization codes that are not physically located on a card, its packaging, an Internet website, or other promotional materials. "Prepaid telephone calling card" or "card" does not include cards or other rights of use that provide access to any of the following:

(1) a telecommunications service wherein the card or other rights of use and telecommunications service are provided for free or at no additional charge as a promotional item accompanying a product or service purchased by a consumer; or

(2) a wireless telecommunications service account wherein the purchaser has a pre-existing relationship with the wireless service provider or establishes a carrier-customer relationship via the purchase of the object.

"Prepaid telephone calling card distributor" means any entity, corporation, company, association, firm, partnership, or person that purchases prepaid telephone calling cards from a prepaid telephone calling card provider or distributor and sells, re-sells, issues, or distributes cards to one or more distributors of such cards or to one or more retail sellers of cards. "Prepaid telephone calling card distributor" does not include any retail merchants or sellers of prepaid telephone calling cards exclusively engaged in point-of-sale transactions with end-user customers.

Section 15. Required disclosures of prepaid telephone calling cards or services.

(a) Any prepaid telephone calling service provider or prepaid telephone calling card distributors shall disclose all of the following information relating to the terms and conditions of the prepaid telephone calling card or service:

(1) The total value in dollars or the number of calling minutes available of the prepaid telephone calling card or service at the time of purchase.

(2) The total value in dollars or the number of calling minutes charged or deducted specifically for the use of the card on a payphone. The prepaid telephone calling service provider or prepaid telephone calling service distributor shall separately state the total value in dollars or the number of calling minutes charged or deducted for any of the following:

(A) for the amount of money paid by the prepaid calling service provider to the payphone service provider for the use of the payphone; and

(B) by the prepaid telephone calling service provider in addition to those in provision (A) of this item (2) for the use of the card on the payphone.

(3) The name of the prepaid telephone calling service provider.

(4) The prepaid telephone calling service provider's customer service telephone number and hours of service.

(b) The location of the disclosure and language requirement shall be as follows:

(1) In the case of a prepaid telephone calling card, the disclosures required under subsection (a) of this Section shall be printed in plain English language in a clear and conspicuous location on the prepaid telephone calling card or its packaging. If the card is enclosed in opaque packaging, the disclosures shall be printed on the outside packaging of the card.

(2) In the case of a prepaid telephone calling service that consumers access and purchase via the Internet, the disclosures required under subsection (a) of this Section shall be displayed in plain English language in a clear and conspicuous location on the Internet site that the consumer must access prior to purchasing the service.

(3) The disclosures required under subsection (a) of this Section shall also be printed on any advertising for the prepaid telephone calling card or service, including on any signs for display by retail merchants, any promotional emails, any Internet site used to promote the card or service, and on any other promotional material.

(4) If a language other than English is predominantly used on a prepaid telephone calling card, its packaging, or in point of sale advertising, or promotional material of a prepaid telephone calling card or prepaid telephone calling service, then the disclosures required by this Section shall be disclosed in that language on the card, packaging, advertisement, or promotional material.

Section 20. Unlawful conduct related to prepaid telephone calling cards.

(a) It shall be a violation of the Consumer Fraud and Deceptive Business Practices Act for any prepaid telephone calling service provider or prepaid telephone calling card distributor to assess any fee associated with the prepaid telephone calling card or prepaid telephone calling service, or impose any charge for any permitted use of the prepaid telephone calling card or prepaid telephone calling service if the fee or charge is not disclosed as required under Section 15 of this Act.

(b) It shall be a violation of the Consumer Fraud and Deceptive Business Practices Act for any prepaid telephone calling service provider to provide fewer minutes than the number of minutes promoted or advertised on any prepaid telephone calling card, any point of sale material relating to the card or the other advertising related to any prepaid telephone calling card or service. Any limitation on the period of time for which the displayed, promoted, or advertised minutes will be available to the customer shall be conspicuously displayed on the card, packaging, and promotional material that lists the minutes, consistent with Section 15 of this Act.

(c) It shall be a violation of the Consumer Fraud and Deceptive Business Practices Act for any prepaid telephone calling card distributor to distribute any prepaid telephone calling card that the distributor knows that the prepaid telephone calling card provides fewer minutes than the number of minutes promoted or advertised on any prepaid telephone calling card, any point of sale material relating to such card, any voice prompt indicating the number of minutes available, or other advertising relating to any prepaid telephone calling card or service. Any limitations on the period of time for which the displayed, promoted, or advertised minutes will be available to the customer shall be conspicuously displayed on the card, packaging, and promotional material that lists the minutes, consistent with Section 15 of this Act.

(d) It shall be a violation of the Consumer Fraud and Deceptive Business Practices Act for any prepaid telephone calling service provider to provide fewer minutes than the number of minutes promoted or advertised through any voice prompt given to a customer at the time the customer places a call to a dialed destination with the prepaid telephone calling card or service.

(e) It shall be a violation of the Consumer Fraud and Deceptive Business Practices Act for any prepaid telephone calling card distributor to distribute prepaid telephone calling cards that it knows provide fewer minutes than the number of minutes promoted or advertised through any voice prompt given to a customer at the time the customer places a call to a dialed destination with the prepaid telephone calling card or service.

(f) Unless a different expiration date is clearly disclosed pursuant to the disclosure requirements under Section 15 of this Act, it shall be unlawful for any prepaid telephone calling service provider or prepaid telephone calling card distributor to provide, issue, resell, or distribute a prepaid telephone calling card or service that expires (i) less than 1 year from the date on which the card or service is first used; or (ii) in the case of a prepaid telephone calling card or service that permits the consumer to purchase additional usage minutes or add additional value to the card or service, less than 1 year from the date on which the consumer last purchased additional usage minutes or added additional value to the card or service.

(g) It shall be a violation of the Consumer Fraud and Deceptive Business Practices Act for any prepaid telephone calling service provider or service to assess any fee or charge for any unconnected telephone call. For purposes of this subsection (g), a telephone call shall not be considered connected if the person placing the call receives a busy signal or if the call is unanswered.

(h) Liability under this Section may not be avoided by stating that the displayed, promoted, or advertised minutes are subject to fees or charges, or by utilizing other disclaimers or limitations.

(i) A violation of this Section is an unlawful practice within the meaning of the Consumer Fraud and Deceptive Business Practices Act.

Section 90. The Consumer Fraud and Deceptive Business Practices Act is amended by changing Sections 2Z and 2TT as follows:

(815 ILCS 505/2Z) (from Ch. 121 1/2, par. 262Z)

Sec. 2Z. Violations of other Acts. Any person who knowingly violates the Automotive Repair Act, the Automotive Collision Repair Act, the Home Repair and Remodeling Act, the Dance Studio Act, the Physical Fitness Services Act, the Hearing Instrument Consumer Protection Act, the Illinois Union Label Act, the Job Referral and Job Listing Services Consumer Protection Act, the Travel Promotion Consumer Protection Act, the Credit Services Organizations Act, the Automatic Telephone Dialers Act, the Pay-Per-Call Services Consumer Protection Act, the Telephone Solicitations Act, the Illinois Funeral or Burial Funds Act, the Cemetery Care Act, the Safe and Hygienic Bed Act, the Pre-Need Cemetery Sales Act, the High Risk Home Loan Act, the Payday Loan Reform Act, the Mortgage Rescue Fraud Act, subsection (a) or (b) of Section 3-10 of the Cigarette Tax Act, the Payday Loan Reform Act, subsection (a) or (b) of Section 3-10 of the Cigarette Use Tax Act, the Electronic Mail Act, the Internet Caller Identification Act, paragraph (6) of subsection (k) of Section 6-305 of the Illinois Vehicle Code, Section 18d-115, 18d-120, 18d-125, 18d-135, or 18d-150 of the Illinois Vehicle Code, Article 3 of the Residential Real Property Disclosure Act, the Automatic Contract Renewal Act, the Calling Card Consumer Protection Act, or the Personal Information Protection Act commits an unlawful practice within the meaning of this Act.

(Source: P.A. 94-13, eff. 12-6-05; 94-36, eff. 1-1-06; 94-280, eff. 1-1-06; 94-292, eff. 1-1-06; 94-822, eff. 1-1-07; 95-413, eff. 1-1-08; 95-562, eff. 7-1-08; 95-876, eff. 8-21-08.)

(815 ILCS 505/2TT)

Sec. 2TT. Prepaid calling service.

(a) For purposes of this Section, the terms "Prepaid Calling Service", "Prepaid Calling Service Provider", "Prepaid Calling Service Retailer", and "Prepaid Calling Service Reseller" shall have the same definitions as those in Sections 13-230, 13-231, 13-232, and 13-233, respectively, of the Public Utilities Act.

For the purposes of this Section, "international preferred destination" means a prepaid calling service that advertises a specific international destination either on the card, the packaging material accompanying the card, or through an offering of sale of the service.

(b) On and after July 1, 2005, it is an unlawful practice under this Act for any prepaid calling service provider or prepaid calling service reseller to sell or offer to sell prepaid calling service to any prepaid calling service retailer unless the prepaid calling service provider has applied for and received a Certificate of Prepaid Calling Service Provider Authority from the Illinois Commerce Commission pursuant to the Public Utilities Act and the prepaid calling service provider or prepaid calling service reseller shows proof of the prepaid calling service provider's Certificate of Prepaid Calling Service Provider Authority to the prepaid calling service retailer.

(c) On and after July 1, 2005, it is an unlawful practice under this Act for any prepaid calling service retailer to sell or offer to sell prepaid calling service to any consumer unless the prepaid calling service retailer retains proof of certification of the prepaid calling service provider by the Illinois Commerce Commission pursuant to the Public Utilities Act. The prepaid calling service retailer must retain proof of certification for one year or the duration of the contract with the reseller, whichever is longer. A prepaid calling service retailer with multiple locations selling prepaid calling cards under contract with a prepaid calling service provider may keep the certification at a central location provided, however, that the prepaid calling service retailer make a copy of the certification available upon reasonable request within 48 hours.

(d) On and after July 1, 2005, no prepaid calling service provider or prepaid calling service reseller shall sell or offer to sell prepaid calling service, as those terms are defined in Article XIII of the Public Utilities Act, to any Illinois consumer, either directly or through a prepaid calling service retailer, unless the following disclosures are made clearly and conspicuously:

(1) At a minimum, the following terms and conditions shall be disclosed clearly and conspicuously on the prepaid calling card, if applicable:

(A) the full name of the Prepaid Calling Service Provider as certificated by the Illinois Commerce Commission;

(B) the toll-free customer service number, and if such service is not provided 24 hours per day, 7 days per week, then the hours of service;

(C) an access number that is toll-free or a number local to the prepaid calling retailer; and

(D) the refund policy or a statement that the refund policy is located on the packaging materials.

(2) At a minimum, all the material terms and conditions pertaining to the specific prepaid calling card shall be disclosed in plain English clearly and conspicuously on the prepaid calling card, on the packaging materials accompanying the prepaid calling card, or visibly displayed at the point of sale, including, but not limited to, the following, if applicable:

(A) the value of the card in minutes or the domestic rate per minute of the card;

(B) all surcharges, limitations on the use of minutes available, and fees applicable to the use of the domestic prepaid calling service;

(C) all applicable rates for international preferred destinations;

(D) all applicable surcharges and fees for international preferred destinations;

(E) a disclosure statement indicating that all rates, surcharges, and fees applicable to international calls are available through the toll-free customer service number and a statement disclosing if international rates vary from domestic rates; and

(F) the expiration policy; and .

(G) applicable policies relating to refund, recharge, decrement, and expiration. If the card is enclosed in opaque packaging, then the disclosures shall be printed on the outside of the packing of the card.

(3) At a minimum, the following information shall be disclosed clearly and conspicuously and accurately through the toll-free customer service telephone number through which the customer is able to speak with a live customer service representative:

(A) the Illinois Commerce Commission certificate number of the Prepaid Calling Service Provider;

(B) all applicable rates, terms, surcharges, and fees for domestic and international calls;

(C) all information necessary to determine the cost of a given call;

(D) the balance of use in the consumer's account; and

(E) the applicable expiration date or period.

(4) In the case of a prepaid calling service that consumers access and purchase via the Internet, the disclosures required under this subsection (d) shall be displayed in plain English language in a clear and conspicuous location, including conspicuous instructions and directions to any link to such disclosures, on the Internet site that the consumer must access prior to purchasing service.

(5) With respect to prepaid calling service, the disclosures required in this subsection (d) shall also be printed on any signs for display by retail merchants and on any other promotional material used at the point of sale that is prepared by, or at the direction of, a prepaid calling service provider, prepaid calling service reseller, or prepaid calling service retailer.

(6) If a language other than English is predominately used on a prepaid telephone calling card or its packaging or in point of sale advertising or promotional material of a prepaid calling service provider, prepaid calling service reseller, or prepaid calling service retailer, then the disclosures required by this Section shall be disclosed in that language on the card, packaging, advertisement, or promotional material.

(e) It shall be a violation of this Act for any prepaid calling service provider, prepaid calling service reseller, or prepaid calling service retailer to assess any fee associated with the prepaid telephone calling card or prepaid telephone calling service, or impose any charge for any permitted use of the prepaid telephone calling card or prepaid telephone calling service if the fee or charge is not disclosed as required under subsection (d) of this Section.

(f) Except with regard to lawful charges or deductions that are fully disclosed prior to purchase, it shall be a violation of this Act for any prepaid calling service provider, prepaid calling service reseller, or prepaid calling service retailer to provide fewer minutes than the number of minutes promoted or advertised on any prepaid telephone calling card, any point of sale material relating to the card, or the other advertising related to any prepaid telephone calling card or service. Any limitation on the period of time for which the displayed, promoted, or advertised minutes will be available to the customer shall be conspicuously displayed on the card, packaging, and promotional material that lists the minutes, and be consistent with subsection (d) of this Section.

(g) It shall be a violation of this Act for any prepaid telephone prepaid calling service provider, prepaid calling service reseller, or prepaid calling service retailer to distribute any prepaid telephone calling card that the prepaid calling service provider, prepaid calling service reseller, or prepaid calling service retailer knows provides fewer minutes than the number of minutes promoted or advertised on any prepaid telephone calling card, any point of sale material relating to such card, any voice prompt indicating the number of minutes available, or other advertising relating to any prepaid telephone calling card or service. Any limitations on the period of time for which the displayed, promoted, or advertised minutes will be available to the customer shall be conspicuously displayed on the card, packaging, and promotional material that lists the minutes, and be consistent with subsection (d) of this Section.

(h) It shall be a violation of this Act for any prepaid calling service provider to provide fewer minutes than the number of minutes promoted or advertised through any voice prompt given to a customer at the time the customer places a call to a dialed destination with the prepaid telephone calling card or service.

(i) It shall be a violation of this Act for any prepaid calling service reseller or prepaid calling service retailer to distribute prepaid telephone calling cards that it knows provide fewer minutes than the number of minutes promoted or advertised through any voice prompt given to a customer at the time the customer places a call to a dialed destination with the prepaid telephone calling card or service.

(j) Unless a different expiration date is clearly disclosed pursuant to the disclosure requirements under subsection (d) of this Section, it shall be unlawful for any prepaid calling service provider, prepaid calling service reseller, or prepaid calling service retailer to provide, issue, resell, or distribute a prepaid telephone calling card or service that expires (i) less than one year after the date on which the card or service is first used or (ii) in the case of a prepaid telephone calling card or service that permits the consumer to purchase additional usage minutes or add additional value to the card or service, less than one year from the date on which the consumer last purchased additional usage minutes or added additional value to the card or service.

(k) It shall be a violation of this Act for any prepaid telephone calling service provider to assess any fee or charge for any unconnected telephone call. For purposes of this subsection (k), a telephone call shall not be considered connected if the person placing the call receives a busy signal or if the call is unanswered.

(l) Liability under this Section may not be avoided by simply stating that the displayed, promoted, or advertised minutes are subject to fees or charges. A prepaid calling service provider, prepaid calling service reseller, or prepaid calling service retailer shall not be liable for lawful fees, charges, and limitations, including lawful conditions of use, that are disclosed.

The disclosures required under this subsection (d) do not apply to the recharging of dollars or minutes to a previously purchased card allowing prepaid calling service.

(Source: P.A. 95-331, eff. 8-21-07.)

Section 99. Effective date. This Act takes effect upon becoming law.".