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Senators debate expansion of telephone-fraud law; concerns about scope and exemptions leave bill unfinished
Summary
A committee substitute for Senate Bill 39 that would extend telephone-fraud rules to solicitations that induce in-person appointments drew sustained floor scrutiny over whether the language is overly broad and could capture legitimate small businesses; sponsors said exemptions were included but senators requested further review and the matter was left for Monday.
A substitute version of Senate Bill 39, aimed at preventing telephone-based fraud, drew extended debate on Jan. 27, 1995 as senators questioned whether the bill's language and proposed exemptions would inadvertently sweep in legitimate businesses.
Senator David Watson, explaining the committee substitute, said the bill targets solicitations that use telephone inducements to get a prospective purchaser to keep an appointment that directly results in a purchase that would not have occurred without the telephone contact. He told colleagues the statute is meant to prevent callers from using the telephone to entice people to a neutral location and then complete questionable transactions, and that legitimate businesses are largely exempted.
Senator Richards raised concerns that the proposed language—especially lines describing inducement to an appointment that directly results in a purchase—could unintentionally cover ordinary marketing activities, including some examples he cited from his own window-covering business. ‘‘I rise here to speak strongly against this particular bill unless there’s some amendments to the language that I had spoken to,’’ Richards said.
Other senators questioned the five-year-in-business and same-operating-location language in committee amendments; Senator Steiner argued the measure could apply broadly to anyone not continuously in business for five years in Utah who uses the phone and then meets to do a sale. Senator Watson said committee drafters sought to preserve exemptions for established businesses with a principal office and to focus the law on transient operators who use a phone number and a motel room to conduct transient sales.
Senators also discussed enforcement mechanics, the breadth of consumer-protection coverage, and whether the bill's drafting might push legitimate small operators inadvertently into a regulatory trap. The sponsor and committee said they would refine language where necessary; several senators asked to take copies home and examine the text further. The Senate left SB39 unfinished for further consideration on Monday morning.
