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What does Section 5 of the FTC act do?
Prohibits unfair and deceptive practices.
The primary law used by the FTC to regulate advertising is Sections 5 of the FTC Act prohibiting deceptive trade practices.
Usually deals with a single practice in a single industry and cover all firms in the affected industry.
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Who is a consumer?
An actual person [not a business, corp, or entity] who purchases for personal, family, or household use.
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Federal Trade Commission [FTC]
Purpose and which type of order is used most frequently at the FTC for consumer protection?
the primary federal agency that protects consumers
Created in 1914, the FTC is an "independent" regulatory agency charged with keeping competition free and fair, and w protecting consumers. The consumer protection mission of the FTC is promoted by a special bureau called the Bureau of Consumer Protection [the regulatory center for federal consumer protection].
Consent Order
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What does the Trade Practice Regulation ensure?
Ensures fair competition by preventing those who would deceive consumers from diverting trade from those who compete honestly.
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Advisory opinion
Industry guides
Although not legally binding, an advisory opinion furnishes a good idea about how the FTC views the legality of a given trade practice.
Industry guidelines specify the agency's view of the legality of a particular industry's trade practices.
Neither legally binding
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What is a Respondent?
an individual or company that has allegedly violated Section 5.
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What is Corrective Advertising?
When a company has advertised deceptively, the FTC can require it to run ads that admit the prior errors and correct the erroneous information.
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Determining deception
Section 5
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Consumer Rights under Fair Credit Reporting Act regarding Investigative Consumer Reports
reports on a consumer's character, general reputation, mode of living, and so on, obtained by personal interviews in the consumer's community.
No one may obtain such a report unless at least 3 days' advance notice is given the consumer that a report will be sought.
Consumer has the right to be informed of the nature and the scope of any such personal investigation.
Usually conducted by insurance companies and employment agencies.
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The Equal Credit Opportunity Act [ECOA]
Purpose?
To prevent discrimination in credit extension.
Prohibits discrimination based on sex, marital status, race, color, age, religion, nat'l origin, or receipt of welfare in any aspect of a consumer credit transaction. Aimed specifically at preventing sex discrimination.
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Redlining
Refusing to make loans at all in certain areas where property values are low, can discriminate on the basis of race in granting mortgage credit.
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