FTC Testifies Before Congress on Fraud Affecting Military Community

For Release

The Federal Trade Commission testified before a U.S. Senate Committee regarding the agency’s law enforcement and educational efforts to combat deceptive and unfair practices that impact servicemembers and their families.

Testifying before the Senate Committee on Commerce, Science, and Transportation, Charles Harwood, Deputy Director of the Bureau of Consumer Protection, said that although all consumers are potential targets for fraudsters, certain scams are more likely to affect the military community. The testimony describes the work the Commission has done to identify illegal conduct that impacts servicemembers and to stop it – including through a recent case against one of the nation’s largest refinancers of home loans for allegedly making misleading claims targeted at current and former servicemembers.

The testimony also highlights Military Sentinel, part of the FTC’s Consumer Sentinel Network that the Commission uses to collect complaints from consumers and other federal agencies and organizations. In 2012, the FTC received 42,200 fraud complaints from the military community. The top complaint categories were debt collection, imposter scams, fraud involving prize offers, sweepstakes or gifts, unlawful banking or lending practices, and scams that offer mortgage foreclosure relief or debt management services. Notably, these complaint categories overlap with some of the FTC’s highest consumer protection priorities – particularly its aggressive recent work to stop frauds related to consumer financial products and services.

The Commission is working with the DoD, VA, Departments of Education and Justice, and the Consumer Financial Protection Bureau to collect feedback from the military community regarding education institutions that may not have lived up to the promises they made to their students. The agency also is coordinating with the Defense Department on possible amendments to DoD’s military lending rule.

In addition to its law enforcement efforts and coordinating with its partners on policy initiatives, the FTC uses a variety of resources to educate military families about their rights when dealing with certain consumer protection issues. Some of the FTC’s military specific resources include information on limiting the harm from identity theft, placing an active duty alert on a credit report, and understanding military protections with respect to payday loans.

Most recently, the FTC published Eight Questions to Ask When Choosing a College After Military Service. Last year, the agency launched its first Military Consumer Protection Day, an annual partnership campaign and new website to inform the military community and veterans about a variety of consumer issues from dealing with debt to avoiding fraud.  

The Commission vote approving the testimony was 4-0.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

Contact Information

MEDIA CONTACT:
Cheryl Hackley
Office of Public Affairs
202-326-2480
 
STAFF CONTACT:
Colin Hector
Bureau of Consumer Protection
202-326-3224

Carole Reynolds
Bureau of Consumer Protection
202-326-3230