The Attorney General of Pennsylvania last week announced a settlement with a lead generator that was accused of selling the personal information of state residents to telemarketing companies. The company will be permanently enjoined from selling or sharing consumer data unless it was acquired in compliance with the Telemarketing Sales Rule. It will also have to pay a fine of $25,000.
The Background: Shopgala, which does business as Surveys2cash, operates three websites that offers consumers free samples or the opportunity to be paid for taking online surveys. Consumers are required to register their personal information, such as names, addresses, dates of birth, telephone numbers, and email addresses in order to be eligible to participate. When filling out the form, consumers were required to check a box to opt in to the following disclosure:
- By checking the box I consent to receive phone sales calls or SMS text messages – Msg and data rates may apply – from Shopgala and our marketing partners on the landline or mobile number I provided event if I am on the federal or state do not call registry. I understand these calls and SMS text messages may be generated using an autodialer and may contain pre-recorded messages and that consenting is not required to participate in the offers promoted. I understand that I may revoke consent at any time. Text STOP to opt out and HELP to receive help.
- The marketing partners was linked to a page that listed 110 different companies.
- Shopgala did not offer free samples or pay people for taking surveys — they aggregated these offers that are publicly available without any registration required.
- The company was accused of violating the state’s Consumer Protection Law by failing to disclose it was collecting data for the purposes of lead generation, failing to disclose that personal information may be sold to third parties, and failing to obtain express consent to be contacted, among other violations.
The Settlement: The company denied it violated the Telemarketing Sales Rule and the Consumer Protection Law and cooperated with the Attorney General’s investigation.
The company must:
- clearly disclose to consumers in manner that is easily accessible that Respondent is collecting “Consumer Data” for purposes of lead generation
- clearly disclose to consumers in manner that is easily accessible its policies and procedures relating to Respondent’s sharing and selling of “Consumer Data” to third parties
among other changes.