Keeping Missouri Cannabis Businesses up-to-date on the latest developments in SMS marketing compliance within the cannabis industry with this incredible article from Cannabis Business Executive. Discover the critical laws and carrier regulations that shape your approach, with a focus on T-Mobile's updated fines effective from January 1, 2024. Learn about prohibited messages, including SMS phishing (smishing) and social engineering, along with the consequences of illegal content. Delve into Section 5 of the T-Mobile Code of Conduct, highlighting specific prohibitions relevant to cannabis businesses. Additionally, gain insights into federal laws such as the CAN-SPAM Act and the Telephone Consumer Protection Act, ensuring a comprehensive understanding of SMS marketing compliance in 2024.
Many brands operating in and with the cannabis industry have had great success with text message marketing when they follow the laws and wireless carrier rules. For example, did you know businesses are only allowed to send marketing messages via text between 8:00 a.m. and 9:00 p.m. in the recipient’s time zone?
There are a number of established laws that tell you what you can and cannot do with SMS marketing, some of which are discussed below. However, both laws and carrier rules can change. If you don’t keep up and comply, you could face hefty fines, and carriers may penalize you by blocking your ability to send SMS messages entirely.
T-Mobile’s 2024 Fines for Sending Prohibited Messages
A perfect example of updated wireless carrier rules is the increased fines T-Mobile will start issuing on January 1, 2024 to companies that send prohibited messages. T-Mobile has nearly 118 million customers in the United States as of the third quarter of 2023, and you don’t want to lose access to them by violating the rules!
What are the 2024 Fines?
The fine for SMS phishing, smishing, and social engineering will be $2,000 starting January 1st, and the fine for illegal content will jump to $1,000. Content must be legal in all 50 states and at the federal level, or T-Mobile will consider it to be illegal.
Fines for all other violations in Section 5 of the T-Mobile Code of Conduct (including but not limited to sex, hate, alcohol, firearms, and tobacco – SHAFT – content) will go up to $500.
What is a Prohibited Message?
To avoid being fined by T-Mobile (or other carriers with similar rules), you need to understand what the various types of prohibited messages and illegal content are. Here are some definitions that will help:
Smishing: Mobile text messages sent to trick people into downloading malware, sharing personal or sensitive information, or sending money. The messages may or may not claim to be from a reputable company. This activity is referred to as phishing when it happens via email or on websites.
Social Engineering: Social engineering is a collective term that refers to all techniques used to reveal personal or specific information from a recipient (e.g., username, password, Social Security Number, etc.) like smishing and phishing. Social engineering also includes actions performed for illegal purposes, such as pretexting a recipient claiming to be from a well-known company with a goal to obtain personal information.
Illegal Content: T-Mobile and most other wireless carriers define illegal content as any content that is not legal in all 50 states and at the federal level. There are three sections of the T-Mobile Code of Conduct that are highly relevant to cannabis businesses: Section 5.1 Unlawful, Unapproved or Illicit Content, Section 5.2 Disallowed Content, and Section 5.7 Age Gating:
- Section 5.1 Unlawful, Unapproved or Illicit Content: Including but not limited to spam, fraudulent or misleading messages, depictions or endorsements of violence, inappropriate content, profanity or hate speech, or endorsement of illegal drugs.
- Section 5.2 Disallowed Content: Including high-risk financial services, debt forgiveness, illegal substances (e.g., cannabis), work and investment opportunities, gambling, and several other types of content.
- Section 5.7 Age Gating: Age-restricted content must include an age-gate mechanism that includes a date of birth verification during the recipient’s consent opt-in.
Be sure to review Section 5 of the T-Mobile Code of Conduct for all of the details about prohibited messages and illegal content as well as the fines and other penalties that will be imposed if you violate any of the rules.
SMS Marketing Laws to Follow in 2024
In addition to carriers’ rules, you need to follow state and federal SMS marketing laws to avoid fines and retain your ability to send text messages to recipients in the future. Two key federal laws include the CAN-SPAM Act and the Telephone Consumer Protection Act.
CAN-SPAM Act
The CAN-SPAM Act says businesses are not allowed to send unwanted text messages to mobile phone numbers, and recipients must be able to easily unsubscribe and identify that a message is an ad.
Telephone Consumer Protection Act (TCPA)
The Telephone Consumer Protection Act says businesses may not send text messages without getting explicit written consent first. When getting consent, businesses must also:
- Provide a clear description of what a person is subscribing to.
- Inform people of approximately how many text messages they’ll get per week or month.
- Provide instructions for people to get help.
- Provide directions for people to opt out of receiving messages.
- Provide a link so people can read the full terms and conditions of the program and the privacy policy.
The fine is $500 per negligent violation of the TCPA plus $1,500 in statutory damages for each unlawful text message sent if the sender intentionally violated the law.
How to Avoid SMS Messaging Violations and Fines in 2024
To avoid getting in trouble for noncompliance with laws or carrier rules, always get explicit written permission before you send SMS messages to consumers. That means you should never buy a list and send SMS messages to people on the list – they didn’t opt in to get texts from you. Also, make it very easy for people to unsubscribe from receiving your text messages.
SMS marketing is effective for businesses operating in and with the cannabis industry, but you must understand and follow all of the rules for it to be successful for you in the long-term.
Author: Susan Gunelius