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DOCUMENT RESUME
07354 - [C29680,5]
Victims of Unfair Business Practices Get Limited Help from the
F,aderal Trade Commission. HRD-78-140; B-139310. October 17,
1978. 24 pp. + 2 appendices (9 pp.).
Report to the Congress; by Elmer B. Staats, Comptroller General.
Issue Area: Consumer and Worker Protection: Consumers Protection
frcm Unfair or Deceptive Trade Practices, Advertising, and
Warranties (913).
Contact: Human Resources Div.
Budget Function: Commerce and Transportation: Other Advancement
and Regulation of Commerce (403); Law Tnforcemert and
Justice: Federal Law Enforcement and Prosecution (751).
Organization Concerned: Federal Trade Commission.
Congressioial Relevance: House Committee on Inters.tate and
Foreign Commerce; Senate Committee on Commerce, Science, and
Transportation; Congress.
Authority: Federal Trade Commission Act of 1914 (15 U.S.C. 41).
Clayton Act (15 U.S.C. 12). Consumer Credit Protection Act
(15 U.S.C. 1601). Administrative Procedure Act (5 U.S.C.
551). Magnuson-Moss Warranty--Federal Trade Commission
Improvement Act. FTC Amendmeuts of 1978. 88 Stat. 2183. 15
U.S.C. 57b. H.R. 3816 (95th Cong.). Snyder v. Harris, 394
U.S. 332 (1969). Heater v. FTC, 503 F.2d 321 (9th Cir.
1974). FTC v. Las Animas Ranch, Inc., No. 78-K-81 (D. Colo).
The Federal Trade Commission (FTC) was organized in
1915 as an independent administrative agency whose objective was
to maintain s4rongly competitive enterprises as the keystone of
our economic system. Legislative authority provides for
identification of unfair or deceptive acts or practices in
commerce and )r enforcement activities. The FTC uses a public
interest stan'..rd to determine which marketplace activities it
will pursue; it does not settle individual cases, but it pursues
programs and cases with larger economic inpact.
Findings/Conclusions: Although the task of protecting consumer
interests in the marketplace is one of its key responsibilities,
the FTC has not been successful in recovering many consumers*
losses. Legislative authority does not provide the FTC with
practical redress authority against businesses. The agency's
administrative process lengthens case timeframes, and its
standards for dishonest or fraudulent practices increase the
FTC's burden Gf proof. Ii addition, businesses' weak financial
conditions limit their ability to provide consumer redress. If
consumers are to receive adequate redress, case actions must be
started as soon as possible and handled expeditiously. The FTC
has experienced delays because of lengthy negotiation periods,
lack of adequate consumer i'jury analyses, and p:oblems with
policy communications. Case delays weaken the ccnsumer's
position by lessening the potential for obtaining redress and
reducing the value of any redress obtained. Recommendations:](ViewImageLocal?handle=hein.gao/gaobaaybp0001&div=1&collection=&method=preview&ext=.png&size=3)