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Did PayPal Exploit Fear of Identity Theft? Judge to Decide

April 27, 2016
By Susan J. Campbell - Telemarketing Software Contributing Editor


There are a number of different reasons why we receive calls from companies. Maybe we’ve done business with them in the past and they hope to spark a new interaction. Perhaps they purchased our name on a list as we fit the right demographic for their new offering. Or, maybe we asked them to call us because we’re interested in what they have to sell. Regardless of the reason, it’s likely there is some sort of telemarketing software working in the background.


But what about those calls that should have had a little more insight into their creation before they were ever made? PayPal (News - Alert) may have needed to take another round with the editing team before launching a recent campaign. An aggrieved customer claims the company exploited his fear of identity theft as a way to enroll him in an illegal telemarketing campaign. He was so upset that he’s hit the company with a lawsuit, claiming the Telephone Consumer Protection Act was violated.

According to the complaint, featured in the piece on The Recorder, plaintiff Scott Wiederhold claims he received an email from PayPal in February, asking for his help in solving an issue with his account. He was assured that the security on the account was a “top priority”. He was then concerned that his account had been compromised and logged onto his PayPal account as instructed. Wiederhold was then instructed to select a method to confirm his identity. Believing text message to be the quickest response method, he opted for this communication channel.

From that point on, Wiederhold did not receive additional information about any unusual account activity, but he did receive at least two pre-recorded messages on his cell phone that marketed a credit card offering through PayPal. Wiederhold believes PayPal created a false impression that he should provide his contact information right away to protect his account and then used that information to place automated calls without his express consent.

Is this a move of bad judgment on the part of PayPal or is the company within legal limits to interact with current account holders, regardless of the type of messaging they use? Should they be required to get expressed consent from account holders and be completely upfront with their intentions moving forward? If so, is there telemarketing software available that can help protect companies in the event that a bad decision is made?

The reality is that no software is going to completely protect a company making decisions that may be questionable. At the end of the day, PayPal is actually facing too much competition to be making poor choices. Whether or not those choices are actually in violation of the TCPA, we may just have to wait and see what the judge has to say. 

 



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