Heading into 2017, Acting Chairman Ohlhausen described 2016 at the FTC by stating that the agency “continued to tackle the issues of most importance to consumers, including fraud utilizing traditional and novel platforms, deceptive advertising, privacy and data security.”
The 2016 Annual Highlights offered a detailed digest of the previous year in law enforcement, policy and education.
Notable statistics related to the FTC’s consumer protection mission in 2016:
- 70 actions filed;
- 117 redress, disgorgement, or permanent injunctions obtained;
- 16 conferences or workshops, 7 rulemakings and 10 reports;
- $11.9 billion in redress and disgorgement, excluding amounts that courts suspended based on defendants’ inability to pay;
- 5.3 million consumers received redress directly from the FTC; and
- 15 million educational publications ordered and another 58 million pages of information viewed.
Recent FTC law enforcement and policy initiatives suggest that the agency will pursue a broadening scope of directions to protect consumers in 2018.
Some topics of note from 2017 include, practices affecting small businesses, health claims, data security and consumer privacy, debt collection, green marketing, endorsements, seals and certifications, ROSCA and “free” trials, and financial injury to consumers.
Particularly noteworthy are privacy, data security, ROSCA and endorsement-related issues.
The FTC has looked, and will continued look, at companies’ privacy and data security practices. The lessons of recent law enforcement actions and closed investigations should not be ignored, including issues pertaining to disclosures and protective measures. Lead generation compliance is now a particular favorite of regulators.
Online negative options and “free” trial will continue to be a regulatory focus, as well. Pursuant to ROSCA, marketers must, without limitation: (i) clearly disclose all materials terms of the deal before obtaining a consumer’s billing information; (ii) obtain a consumer’s express informed consent before making the charge; and (iii) provide a simple mechanism for stopping recurring charges.
Regarding endorsements, if there is a material connection between an endorser and a marketer that a reasonable consumer would not expect, and if it would affect how a consumer evaluates the endorsement, the connection should be conspicuously disclosed. The Commission highlighted its intention to actively police social media campaigns by sending educational letters to influencers and marketers, disseminating follow-up warning letters and then announcing its first settlement with online influencers. The FTC also updated its Endorsement Guides: What People Are Asking brochure to assist companies’ compliance efforts.
See here for the full 2017 FTC Review.
It includes links to pending lawsuits, settlements, blog posts, guidelines and warning letters. It also discusses what is on the regulatory horizon, including the manner in which established consumer protection standards apply as technologies evolve.
Richard B. Newman is an Internet marketing compliance and regulatory defense attorney at Hinch Newman LLP focusing on advertising and digital media matters. His practice includes conducting legal compliance reviews of advertising campaigns, representing clients in investigations and enforcement actions brought by the Federal Trade Commission and state Attorneys General, commercial litigation, advising clients on promotional marketing programs, and negotiating and drafting legal agreements. Follow him on LinkedIn at FTC Defense Lawyer.
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