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Consumer Watch: 'Warranty service'? It may be a scam

The calls often begin with a recording that suggests that your auto warranty is about to expire, or that there may be trouble with your credit card account.

The calls often begin with a recording that suggests that your auto warranty is about to expire, or that there may be trouble with your credit card account.

What they're really telling you is that, despite the overall success of government efforts to limit intrusive telemarketing, there are still some businesses and scam artists willing to push the limits - or blatantly violate them.

One Inquirer reader complained recently of dozens of calls, apparently from a company that identified itself only as "Warranty Service Center," that stretched her patience beyond its limits.

The recording offered an option to "Press 2" if she didn't want to be contacted anymore. She pressed 2 and followed the instructions. But she continued to get more calls – even on her cell phone.

Each of the recordings pitched the same "warranty extension" on her car, which was still covered by a manufacturer's warranty, anyway. Attempts to get a call-back number or speak to a supervisor fell on deaf ears - or ended in swift hang-ups.

Finally, she called the Federal Trade Commission to lodge a complaint; she learned she was far from alone.

The FTC will not discuss pending investigations, so it is unclear whether it is on the trail of whomever is behind these auto-warranty or credit-services calls, or even how many companies may be involved.

But Michael Tankersley, a staff attorney in the FTC's marketing-practices division, confirmed in an interview that the agency had received more than 10,000 complaints during the last year about marketing calls pitching auto warranties.

Tankersley said call recipients apparently were not protected by having their phone numbers on the federal Do Not Call list, which since 2003 has dramatically reduced frustration with telemarketing calls. Once a dinnertime scourge for many families, telemarketing is now more of an occasional headache, at least for those who have put 170 million landline and wireless phone numbers on the list. (To add yours, go to or call 1-888-382-1222.)

One thing the warranty calls make clear is that the phone system, much like the Internet, is still a venue for people or companies willing to violate the law to make a quick buck. Despite what appear to be U.S. numbers on caller ID, some of the originators may be international scam artists trolling for identity-theft victims, not warranty purchasers.

To help stop them, Tankersley said it was important for consumers to complain with as many details as possible, including the originating number (if available), the name used by the company, and whether the call was prerecorded - illegal for a marketer unless the recipient of the call already is a company's customer.

(To file a complaint about telemarketing or any other problem, go to or call 1-877-382-4357.)

Tankersley said most marketing calls to wireless numbers were illegal unless the phone user has given "express permission." If you get any, complain to your provider and to the Federal Communications Commission. (To file a complaint with the FCC, call 1-888-225-5322 or go to

Verizon Wireless has recently gone after several companies it says have used auto-dialer systems to make illegal pitches to millions of its customers. Last month, it sued three more companies - two based in Missouri and one in the Netherlands. Verizon Wireless said the calls typically started with recorded messages suggesting that the recipient's car warranty was about to expire.

Tankersley said the spate of complaints suggested that there might be copycat schemes involved.

"Given the volume of complaints and the number of different telephone numbers that have been involved in the complaints, it appears that a number of different entities are involved," he said.

Could some of the offerings be legitimate, even if the methods are suspect?

That is possible, but do not count on it. Tankersley said the commission had warned in the past about problems with service contracts portrayed misleadingly as extended warranties, especially those from companies without a connection to an auto dealer or manufacturer.

The phone pitches may violate various federal laws or regulations. Among the issues Tankersley identified:

Prerecorded messages. Telemarketers cannot use these unless the consumer and business have an established business relationship based on a purchase within the last 18 months or an inquiry within the last three months. (Come Sept. 1, they will be allowed only with a consumer's advance permission.)

Even when allowed, recorded messages must meet strict standards: "The recorded message is supposed to begin by identifying the seller on whose behalf the call is being made, and then immediately give the opportunity to press a prompt to get the consumer off the call list for that seller," Tankersley said.

Automated marketing to cell phones, including calls initiated with the nearly ubiquitous auto-dialing systems, is illegal unless preauthorized by the consumer.

Complaining will not necessarily bring immediate results. Telemarketing scams persist because the scammers are wily and technology can keep them a step ahead of the law.

"There are ways to spoof caller ID - ways to fool it so that it's transmitting a phony number," Tankersley said.

Even so, Tankersley said, it's important to report any evidence of violations, including questionable names and numbers.

"All that information is useful for us because it helps us put together the pieces of the puzzle," he said.