FCC Will Allow Mobile Alerts

On July 10, the Federal Communications Commission (FCC) released the Declaratory Ruling and Order that it had adopted at its open meeting of June 18, which will allow banks and credit unions to send urgent fraud, data breach, and money transfer alerts in a convenient, timely way.

The American Bankers Association had petitioned the FCC last October to remove barriers to time-sensitive mobile calls and texts that financial institutions use to reach their customers when their accounts may be compromised.

According to the order, financial institutions may send automated free-to-end-user texts and voice messages, without first obtaining the called party’s prior express consent, concerning: (1) proposed transactions that present a risk of fraud or identity theft; (2) possible breaches of the security of customers’ personal information; (3) steps customers can take to prevent or remedy harm caused by data security breaches; and (4) actions needed to arrange for receipt of pending money transfers.

The relief comes with conditions. Specifically, each automated communication covered by the exemption must include a mechanism by which the recipient may opt out of future communications concerning the same account and category of communication. Also, a financial institution may initiate no more than three messages (whether by voice call or text message) per event over a three-day period for an affected account.

Read paragraphs 127 through 138 of the order.

With regard to reassigned numbers, the order states that the Telephone Consumer Protection Act requires the consent of the current subscriber of the called number, not the intended recipient of the call. The order provides that liability should not attach to the first call to a reassigned number; the caller is liable for any calls thereafter, even when the called party did not advise the caller during the one permitted call that the number had been reassigned.