Regulation

FTC Submits Progress Report To The Senate

Consumers Distrust Financial Services

The FTC presented a written report of its recent work to the U.S. Senate Committee on Commerce, Science and Transportation and requested changes to the common carrier exception to the FTC Act.

The Federal Trade Commission wants changes to the FTC Act that would allow it to provide better protection to consumers and increase competition. The FTC provided written testimony by FTC Chairwoman Edith Ramirez and Commissioners Maureen K. Ohlhausen and Terrell McSweeny to the U.S. Senate Committee on Commerce, Science and Transportation.

The submission described the FTC’s recent work and requested changes that could improve efforts in the future.

The testimony estimated that the agency has saved consumers over $3.4 billion, while its consumer protection actions have saved consumers $717 million through antitrust enforcement efforts. But the commission wants the common carrier exception to the FTC Act to be repealed. The FTC stated that the common carrier exception leaves consumers vulnerable to telecommunications firms and other common carriers.

According to the testimony: “As the telecommunications and internet industries continue to converge, the common carrier exception is increasingly likely to frustrate the FTC’s ability to stop deceptive and unfair acts and practices and unfair methods of competition with respect to a wide array of activities.”

The commission also requested that its jurisdiction be extended to nonprofit entities.

The testimony summarized the consumer protection cases and permanent injunctions that the FTC has presided over and cited the Volkswagen settlement that resulted in $10 billion of consumer compensation. The testimony also cited the FTC’s order against Herbalife, which had to restructure its business operations and pay $200 million to consumers it had deceived into believing they could earn substantial money selling diet and nutritional products.

Also included in the testimony were the commission’s efforts to protect consumers’ privacy and data security. This year, the FTC brought a $100 million judgment against LifeLock. The FTC has prioritized consumer protection from new technologies in recent years and has been promoting competition, particularly in the pharmaceutical industry, by imposing certain conditions on mergers.

According to the testimony, the FTC organizes workshops and reports on cutting-edge topics, such as solar distributed generation and the “sharing” economy. The commission voted 3-0 to approve the testimony and its inclusion in the formal record.

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