Legal Matters: Beneath Those Refund and Return Policies
I highly recommend compliance here, and it’s probably legally required as well. Remote sellers might argue that laws mandating disclosure of return and refund policies “on the premises” or requiring that a “sign” be “posted” in a retail establishment have no applicability to the Internet or to mailed promotional materials. But direct marketers are at considerable risk of a liberal interpretation of these consumer protection laws. The penalties for noncompliance can be substantial.
Catalogs and Internet sites are, in fact, the functional equivalent of retail stores, and most state attorney generals will take the position that a written disclosure is required to satisfy the “posting” or “signage” obligations of their states’ laws.
Some states employ a default period, which requires that a seller’s refund policy must be conspicuously posted unless the retailer has a policy of offering cash refunds for returns made within a statutorily established minimum period of time.
Some examples, New York and Virginia: 20 days. Rhode Island: 10 days. Florida and California: seven days. Hawaii: 60 days.
The absence of a published return policy exposes a retailer to potential charges that customers were intentionally misled regarding their rights as consumers. Full disclosure is a useful defense against claims of unfair and deceptive trade practices.
Moreover, disclosure of its refund/return policy permits a retailer to craft a shorter return period than would result from an applicable state statute setting a “default” refund period. Given these factors, publication of product return policies is a sound and sensible business practice, as well as a prudent course of legal conduct.
Telemarketing Sales Rule
Although disclosure of return policies is primarily an issue of state regulation, the Telemarketing Sales Rule (implementing the federal Telemarketing and Consumer Fraud and Abuse Prevention Act) applies to businesses that use either inbound or outbound interstate telephone calls to sell goods or services. The Rule states disclosure is required if a seller