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Thursday, August 7, 2014

Email Advertising: CAN-SPAM Compliance


QUESTION 
I am aware of the “do not call’ list, but is there a similar type of “do not email” list?  Also, what regulations do we need to be aware of if we choose to solicit business via email?

ANSWER 
There is no email equivalent to the federal “do not call” list, yet there are federal rules set forth in the CAN-SPAM Act that must be adhered to when a commercial message or advertisement is transmitted via email. [“CAN-SPAM” is a nickname for Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 (15 USC Chapter 103).]

The CAN-SPAM Act covers all commercial messages defined as “any electronic mail message the primary purpose of which is the commercial advertisement or promotion of a commercial product or service” [See Section 3(2) of the Act] Unlike many other advertisement regulations, the CAN-SPAM Act does not contain an exception for business to business emails. 

     Below is a summary of the important CAN-SPAM requirements:
  1. Opt-Out/Unsubscribe Requirement [Section 5(a)(5)] – The email must contain a clear and conspicuous explanation detailing a mechanism for the recipient to opt out of all future emails. All opt-out requests must be honored within 10 business days. The only information recipients can be asked to provide, in order to opt out of future emails, is their email addresses. 
  2. No ghost emails permitted – A valid physical address of the sender of the message and/or the advertiser must be set forth in the email [Section 5(a)(5)]. 
  3. Be transparent [Section 5] – (a) the email must clearly and conspicuously indicate it is an advertisement; (b) the subject line must relate to the body of the email and not be deceptive; and, (c) the “from” header must be accurate and identify the sender on the email.
In addition to some violations of the CAN-SPAM Act being deemed criminal offenses, each separate email in violation of the Act subjects the sender of the email to statutory and actual damages as well as attorney’s fees.

In sum, you need to make sure that all email solicitations comply with the CAN-SPAM Act, because an email blast which fails to comply with the CAM-SPAM Act could result in substantial economic damage to a mortgage lender.

Michael Barone
Director/Legal & Regulatory Compliance
Lenders Compliance Group