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FTC

Threat of Scams Heightened in Age of Coronavirus, Say House Consumer Protection Subcommittee Members

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Photo of Cathy McMorris Rogers by Gage Skidmore used with permission

May 11, 2020 — The coronavirus pandemic has given birth to all-too-predictable scams, agreed members of the House Consumer Protection and Commerce Subcommittee and the Federal Trade Commission during a teleconference Monday.

The conference, hosted by Subcommittee Chair Jan Schakowsky, D-Ill., and Ranking Member Cathy McMorris Rodgers, R-Wash., featured FTC Chairman Joe Simons for a discussion about the FTC’s response to the increased fraudulent activity.

The scams take many forms, McMorris Rodgers said. “Whether it’s scams, robocalls, price-gouging, privacy and data security, or other fraud … the FTC is the top cop on the beat for protecting consumers from harm.”

FTC Chairman Joe Simons agreed, saying that the FTC has sent more than 120 warning letters to coronavirus scammers with a high degree of effectiveness.

“We’ve also pursued targeted federal law enforcement, and we’ve worked aggressively to educate consumers,” he said. “The FTC is monitoring the marketplace and will hold accountable those who take advantage of consumers’ financial distress, or their fears and anxiety about COVID-19.”

In April, Rep. Schakowsky joined with Reps. David Cicilline, D-R.I., Frank Pallone, D-N.J. and Jerry Nadler, D-N.Y. to introduce legislation that would “prohibit the sale of consumer goods and services at an unconscionably excessive price.”

The FTC would be interested in prosecuting price-gouging if Congress passed such a law, Simons said. Although he conceded that the agency does not currently have the authority, he told the congresswomen that he “would be very much willing, eager, and enthusiastic and interested in protecting consumers under any statute that you provide.”

The FTC has warned several high-profile individuals to stop selling sham cures for the coronavirus, including televangelist Jim Bakker. On a February broadcast of “The Jim Bakker Show,” Bakker and “natural health expert” guest Sherrill Sellman suggested that Bakker’s “Silver Solution” could cure the coronavirus.

“This influenza that is now circling the globe,” Bakker said, “you’re saying that Silver Solution would be effective.”

“Well, let’s say it hasn’t been tested on this strain of the coronavirus, but it has been tested on other strains of the coronavirus and has been able to eliminate it within 12 hours,” Sellman said. “Totally eliminate it. Kills it. Deactivates it.”

Soon after, the state of Missouri filed a lawsuit against Bakker and his production company, Morningside Church Productions. The FCC and the FDA also warned Bakker that he was hawking unapproved new drugs.

Simons said that fighting such scams was not merely a matter of taking legal action but also of informing consumers.

“For all of these scams and other scams, we’re doing extensive outreach and consumer education,” he said. “And you know we’re going to just continue to be aggressive and bring law enforcement appropriate actions as appropriate.”

Elijah Labby was a Reporter with Broadband Breakfast. He was born in Pittsburgh, Pennsylvania and now resides in Orlando, Florida. He studies political science at Seminole State College, and enjoys reading and writing fiction (but not for Broadband Breakfast).

Antitrust

Republican FTC Commissioner Criticizes Biden Economic Officials as Detrimental to Agency

Commissioner Christine Wilson attributes poor results of FTC staff satisfaction surveys to the officials’ leadership.

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Photo of Christine Wilson, Randolph May, Noah Phillips and Maureen Ohlhausen

WASHINGTON, May 9, 2022 – On Friday Republican commissioner of the Federal Trade Commission Christine Wilson expanded upon released remarks criticizing the leadership of economic officials chosen by President Joe Biden as detrimental to the functioning of her agency and staff.

Wilson pointed to recently administered surveys of FTC staff on satisfaction in their jobs which showed historically poor results for the commission, saying attitudes towards the commission and its work peddled by its Chair Lina Khan, former commissioner and current director of the Consumer Financial Protection Bureau Rohit Chopra and Biden’s special assistant for technology and competition policy Tim Wu are largely to blame for low staff morale.

“We saw Chair Khan’s arrival and a complete disregard for the rule of law and due process, not to mention complete disregard for staff,” said Wilson.

“We saw Commissioner Rohit Chopra arrive at the FTC and begin excoriating the agency and the commission and the staff as being lax and feckless for the last 40 years.”

Speaking at the Free State Foundation’s Annual Policy Conference with fellow Republican Commissioner Noah Phillips and former Republican chairwoman of the commission Maureen Ohlhausen, Wilson cast the commission as an entity in disarray.

She revealed a workplace where commissioners have often been given very little notice on items they will be considering on the agenda of the commission.

Ohlhausen noted a decrease in bipartisan activity from the commission that she felt was present as a long-lasting legacy of commissions past during her tenure as chair, and Wilson described “disdain and marginalization of staff by current leadership” as harmful to the environment at the commission.

Drawing on her recent remarks, Wilson hypothesized that new leadership’s economic worldview draws heavily on concepts from academic Marxism and critical legal studies, a school of thought of which the Republican-maligned critical race theory is an offshoot.

She states that these theories largely play into the view of new leadership that the FTC in the past has not brought nearly enough action to protect consumers.

Also on Friday, Wilson emphasized the need for federal privacy legislation and said she has heard of a “concerted push” in Congress for such legislation to pass soon.

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FTC

Biden Looks to Bedoya to Replace Rohit Chopra on FTC, Report Says

Staunch privacy advocate Alvaro Bedoya appears to be Joe Biden’s pick for the FTC, Axios reports.

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Staunch privacy advocate Alvaro Bedoya appears to be Joe Biden's pick for the FTC

WASHINGTON, September 13, 2021—President Joe Biden is expected to bring on privacy stalwart Alvaro Bedoya for the open seat on the Federal Trade Commission, according to reporting from Axios.

Born in Peru and raised in New York, Bedoya attended Harvard University where he received his B.A. in Social Studies. He also holds a J.D. from Yale.

A longtime supporter of consumer privacy rights, Bedoya is the founding director of the Center on Privacy and Technology at Georgetown Law. Previously, he served as chief counsel of the Senate Judiciary Subcommittee on Privacy, Technology, and the Law. While working in the Senate, much of his work centered on location and biometric privacy with regard to consumer protections.

As it stands now, there are three Democrats and two Republicans on the commission. In January of 2021, Biden tapped Rohit Chopra to serve as the Director of the Consumer Protection Bureau. Though Chopra’s term on the FTC expired in 2019, the commission allows incumbent members to sit until a replacement is appointed—in this case, Bedoya.

The Washington Post quoted Republican FTC commissioner Noah Phillips speaking fondly of Bedoya. “I don’t think of him as a person who just gets up and rants about entities he doesn’t like,” and described him as “without fail as bright and thoughtful a person as you could find.”

Phillips has been broadly critical of the direction he feels the FTC is going and has historically criticized political firebrands on both sides of the aisle.

As Big Tech faces mounting criticism from both Republicans and Democrats with regard to privacy, misinformation, and alleged censorship, Bedoya will be entering a tumultuous era for the FTC.

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Antitrust

FTC Commissioner Phillips Warns About Shifting Direction of Agency

Noah Phillips voiced concern about the scope and practices of the Biden administration’s FTC.

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FTC Commissioner Noah Phillips

WASHINGTON, September 2, 2021 — Federal Trade Commissioner Noah Phillips said at a Hudson Institute webinar on Monday that he’s concerned about the direction the competition watchdog is moving toward considering recent events.

Phillips said the left-leaning voices in Washington and the appointment of Lina Khan to chair the agency has left him wondering about the legacy of the last 40 years of competition regulation in America – which have been hallmarked by the Hart-Scott-Rodino Antitrust Improvements Act of 1976. That legislation effectively gave the FTC the ability to review mergers and acquisitions before they were finalized, rather than afterward, which governed pre-legislation.

Under Biden-appointee Lina Khan, Phillips described how the FTC has done away with the process of early termination. In the past, this process made it unnecessary for every single company to provide advanced notice and advanced approval for mergers. “Historically, parties have been able to come to the agencies and say, ‘You’re not interested in this, can we just go ahead and finish our deal,’ and the agencies have said ‘yes.’”

He said this is no longer the case, and that every single merger must provide advanced notice and approval. “What we’re introducing is an inefficiency in the market for transactions that we have no interest in pursuing, just for the sake of it. I think that’s a problem,” he continued. “My concern is that it is making merger enforcement less effective, less efficient, and less fair.”

Phillips pointed to left-of-center and leftist voices in Congress, such as Rep. David Cicilline, D-New York, Sen. Elizabeth Warren, D-Massachusetts, and Rep. Alexandria Ocasio-Cortez, D-New York, who, at the outset of the pandemic, wanted to ban all acquisitions and mergers—regardless of their merit. He described this view as falling outside of mainstream perspectives, but noteworthy nonetheless.

“I don’t think that is what most people believe,” Phillips remarked. “I don’t think that is what Hart-Scott-Rodino envisions.”

This webinar took place only a couple of weeks after Phillips spoke at the Technology Policy Institute’s 2021 Aspen Forum, where he voiced similar concerns, stating that he feared that this new direction would make it more difficult for the FTC to hear cases that it should, and defended the commission’s record against critics who said it was lax under the Trump Administration.

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