By: Turnkey Trading Partners

Like many of those reading this article, Turnkey Trading Partners uses a voice over internet protocol (“VOIP”) phone system to stay connected with our clients. VOIP has widely replaced traditional hardline phone systems for businesses. It is also a critical component of capturing trader and broker text messages as well as oral phone recordings in a cost-effective manner. Turnkey has many customers utilizing Ring Central, Vonage, Zoom or other similar VOIP systems. A large reason for this is that VOIP systems ensure their compliance with CFTC regulation 1.35 and NFA Interpretive Notice 9037.  For those unfamiliar with these regulations, they each govern the record keeping obligations registrants have for retaining electronic communications with customers.

Regulatory Crisis Looming?

CFTC registrants and NFA member firms utilizing a VOIP services to capture and record text messages, chat messages, or oral phone conversations are at risk of losing that capability.  RingCentral recently informed Turnkey that changes were being made to VOIP SMS communication laws in the United States. In order to continue using SMS services with VOIP phones they informed Turnkey that we would need to comply with these changes. Specifically, Turnkey would need to register our brand, describe how we utilized SMS as a business, and assign company phone numbers to our application to continue using VOIP to Mobile SMS. If we did not do this we would be forced to stop utilizing SMS services all together. This applies to you as well if you utilize VOIP services for your business. This is critically important to pay attention to! In June of 2022 Turnkey wrote about Order Execution audits and how to comply. It will be impossible to comply with this type of review if SMS messages are not recorded and archived via company VOIP systems.

Background of the New Law

In June of 2020, the Chief of the Consumer Governmental Affairs Bureau adopted an update to the Telephone Consumer Protection Act (TCPA) of 1991. The updated TCPA prohibits any person from calling or text messaging someone else on a wireless phone using an automatic telephone dialing system (an “autodialer”) or an artificial or prerecorded voice unless it is an emergency or they have the called party’s prior express consent.

Until recently, wireless carriers did not allow businesses to text from local numbers. You could only text from shared short codes (5 or 6 digit numbers used by multiple organizations). These numbers quickly became a delivery means for SMS spammers with very little oversight.
In 2019, wireless carriers began rolling out 10-digit local code (10DLC) services to allow businesses to send messages from approved local numbers through an SMS platform. Because 10DLC numbers are regulated by wireless carriers, theoretically, consumers receive fewer spam messages.

North American carriers are moving away from unsanctioned long codes and are launching 10DLC as a sanctioned A2P messaging service. In order to create this sanctioned channel, carriers are requiring use of TCR to know who is sending messages and what messaging is being sent. TCR allows carriers to have access to this information, and with this transparency, CSP’s will have their registered campaigns fully supported.

Who needs to register for 10DLC?

Any business that sends SMS to people in the U.S. from a 10-digit local number must register with The Campaign Registry.

What happens if I don’t register for 10DLC?
If you don’t register your 10DLC number, carriers may filter or block your messages and charge additional fees.
In the future, unregistered businesses using long codes to send messages to the U.S. may be banned altogether.

Mobile carriers have made it mandatory for all businesses sending out SMS to self-register with The Campaign Registry (TCR). Otherwise, their SMS traffic will be blocked and prevented from reaching the intended recipients.

TCR Costs:

  • $4.00 fee for Brand Registration and Verification (charged each time the Brand detail needs to be verified)
  • One-time $15.00 Campaign vetting fee (per new campaign) will also apply
  • Rejected or Resubmitted Campaigns will be subject to the Campaign vetting fee each time.

Some of the major VOIP providers and their respective 10 DLC TCR Guides are below:

Some of the major VOIP providers and their respective 10 DLC TCR Guides are linked below: