FTC Testifies before House Appropriations Subcommittee On the Agency’s Work to Protect Consumers and Promote Competition

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In testimony before the House Appropriations Subcommittee on Financial Services and General Government, the Federal Trade Commission described its work to protect consumers and promote competition through vigorous enforcement, education, advocacy, and policy work, and by anticipating and responding to changes in the marketplace.

Testifying on behalf of the Commission, FTC Chairman Joseph Simons and Commissioner Rohit Chopra outlined the FTC’s work in areas ranging from privacy, data security, and consumer fraud, to mergers and acquisitions, to anticompetitive tactics by pharmaceutical and other companies.

Through the third quarter of FY 2019, FTC actions resulted in over $789 million being returned to consumers, the testimony notes. The agency returned more than $459 million in redress to consumers, and FTC defendants paid more than $317 million through self-administered consumer refund programs required by prior FTC settlements.

The FTC estimates that in recent years, the agency saved consumers on average $38.90 for every $1 of resources devoted to its consumer protection program; $50.16 for every $1 of resources devoted to the merger enforcement program; and $40.12 for every $1 of resources devoted to the nonmerger antitrust enforcement program, the testimony notes.

In FY 2019, the Commission also negotiated a record-breaking $5 billion civil penalty against Facebook, and a $170 million penalty against Google and YouTube over alleged violations of children’s privacy law.

For FY 2020, the FTC is requesting $312.3 million and 1,140 FTEs. The Commissioners thanked the House Subcommittee for the $349.7 million in FTC funding that is in the House-passed funding bill for FY 2020.

As the nation’s primary consumer protection agency, the FTC has a broad mandate to protect consumers from unfair or deceptive acts or practices in the marketplace, and to educate consumers and businesses about their rights and responsibilities, the testimony notes.

The FTC has aggressively pursued privacy and data security cases in myriad areas, including children’s privacy, financial privacy, health privacy, and the Internet of Things, the testimony states. The agency’s settlement with Facebook, announced in July, resolved a

six-count complaint that the company violated a 2012 FTC administrative order by deceiving users about their ability to control the privacy of their personal information, among other things. In addition to the $5 billion penalty, the settlement placed restrictions and obligations on Facebook’s business operations as they relate to privacy.

The testimony also noted that recently the FTC and its state law enforcement partners announced a $170 million settlement with Google and YouTube over alleged violations of the Children’s Online Privacy Protection Act, and a $575 million settlement with Equifax over allegations stemming from the company’s 2017 data breach.

As part of its mission to protect consumers, the FTC’s fraud program tracks down and stops some of the most egregious scams that prey on U.S. consumers, including defendants who blast consumers with illegal robocalls, operate sham charities, or deceptively pose as the government or well-known tech companies, according to the testimony. The agency also has brought cases challenging false and unsubstantiated health claims, including those targeting older consumers and individuals affected by the opioid crisis.

To further its competition mission, the FTC’s enforcement of the antitrust laws directly affects consumers and what they pay for products and services in health care, consumer products and services, technology, manufacturing, and energy, the testimony states.

One of the principal responsibilities of the FTC and the Department of Justice is to prevent mergers that may substantially lessen competition, the testimony notes. Pre-merger filings made to the agencies have generally increased steadily since FY 2013. Last year, for the second year in a row, the agencies received just over 2,000 HSR filings.

In an effort to more closely monitor developments in the technology sector, as described in the testimony, the FTC’s recently announced Technology Task Force is examining industry practices, conducting law enforcement investigations, and coordinating and consulting with staff throughout the FTC on technology-related matters, including prospective merger reviews and reviews of consummated technology mergers. The Commission has confirmed that it is pursuing an antitrust investigation of Facebook.

The Commission vote approving the testimony and its inclusion in the formal record was 5-0.

The Federal Trade Commission works to promote competition, and protect and educate consumers. You can learn more about consumer topics and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). Like the FTC on Facebook, follow us on Twitter, read our blogs and subscribe to press releases for the latest FTC news and resources.

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