Have a happy (and less interrupted by telemarketers) New Year

The New Year brings a new federal regulation that will help you opt out of at least some telemarketers come-ons.

Many of you may have wondered why junk mail and phone solicitations seemed to increase shortly after you applied for a new credit card, opened a bank account or applied for a loan, mortgage or life insurance. Often, the solicitations were from companies you never heard of, never did business with, but somehow they had your contact information and tried persistently to convince you to part with your money.

Marketing to customers
Credit card issuers (banks, credit unions, department stores) often share their customer information with affiliates, subsidiaries and third-party partners. The financial services industry is dominated by large conglomerates that own affiliates in multiple financial sectors. Each of those affiliates may have access to data owned by the parent company outlining your personal income, net worth, salary range, occupation, age or whether you rent or own your own home.

Knowing these facts about you and your family helps them determine your eligibility (or buying power) for their products, and they come racing to solicit your business.

The new final rule, issued jointly by all federal banking regulators, taps the brakes. Affiliates or third-party vendors cannot use eligibility information obtained in this manner to solicit customers unless they give consumers notice and a chance -- in writing -- to opt out of the sales pitches. The opt-out protection lasts for at least five years, with the option to renew.

Another change that the rule brings about will eliminate those sneaky, pre-selected check boxes found in some online applications for credit cards and other financial products. Until the rule, if you accidentally overlooked one and left it checked, you opened the telemarketing floodgates. The rule says pre-selected check boxes are no longer valid.

The new rule came about as part of the Fair and Accurate Credit Transaction Act of 2003, which is best known as the law that mandated consumers get at least one free credit report per year. But it also added a requirement that the Feds work out a new rule for affiliate marketing.

The fine print
There are always exceptions to the rules and that's true in this case. You still may be solicitated if you had previously purchased something or done business with the affiliate company, if you responded to a customer questionnaire indicating you wanted information or if you contacted the affiliate requesting information on their products. The law also exempts solicitations that arise through employee benefits programs on your job.

The new affiliate marketing law outlines a broad range of solicitations that would be banned if consumers don't opt-in. If those marketing pitches are based on information gleaned through affiliates, the following kinds of solicitations need your approval:

• A message that pops up on your ATM screen during or following a transaction.
• An invitation to attend a financial education seminar, a customer appreciation event or focus group.

You may still get these kinds of solicitations -- if they are NOT based on your personal eligibility data but are sent to the general public.

The regulation takes effect Jan. 1, 2008, but companies have until Oct. 1, 2008, to fully comply.