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The FTC is Back Up and Running:  The Chairman’s Update on Agency Priorities

The FTC is Back Up and Running: The Chairman’s Update on Agency Priorities

February 6, 2019

FTC Chairman Joe Simons outlined the agency’s priorities in his keynote at the ABA’s consumer protection conference on Tuesday, promising vigorous enforcement as the agency emerges from the shutdown.  Without commenting on any pending investigations, he made clear that the agency would continue to pursue enforcement actions in a number of areas.  And he reiterated calls to Congress to give the agency new tools and expanded authority.

Here are some highlights.

Privacy and data security.  The Chairman remarked that he had no intention to slow down on enforcement efforts in the areas of privacy and data security, and that there was no shift in priorities in these areas with a new Commission.  He also pointed to certain kinds of privacy violations that he viewed as sufficiently harmful to justify enforcement action even without proof of economic harm – the unauthorized posting of pornographic images for example.  On the policy front, he remarked that privacy legislation involves balancing competing values and that Congress was best suited to make those kinds of judgments, rather than the Commission.  But he reiterated that, whatever Congress does in this area, the FTC will enforce the laws vigorously.

In data security cases, the Chairman noted that it’s often difficult to show specific monetary harm that can be traced to a data breach, and therefore to obtain monetary relief.  Indeed, most of the FTC’s data security cases – unlike those brought by states – do not involve monetary penalties.  The Chairman reiterated his call to Congress for civil penalty authority in this area, in addition to jurisdiction over non-profits and expanded rulemaking authority.

Deceptive advertising remains an enforcement priority.  The Chairman pointed to a recent proposed settlement with a PR firm and publisher that engaged athletes to endorse products on social media without disclosing that the athletes had been paid for the endorsement – a practice that the FTC alleged was deceptive.  He also noted that the agency was considering broader remedies in advertising cases, including whether monetary relief should be based on a premium that an advertiser could charge due to the deception, or increased sales as a result of the deception. 

The Chairman emphasized that the FTC remains active in policing financial practices, pointing to ongoing litigation against an online lender and other recent settlements involving fintech companies.  These cases involve alleged privacy violations, deceptive advertising claims, and unauthorized charge claims. 

Robocalls remain the biggest source of consumer complaints, and the Chairman emphasized that the Commission was looking to spur industry to take new and creative steps to try to stop them.  He also called for the Congressional repeal of the common carrier exception to FTC jurisdiction under Section 5 of the FTC Act, arguing that it inhibited effective enforcement in this area.

Finally, he noted that the 21st Century hearings on privacy and broadband that were postponed due to the shutdown will be rescheduled, likely by the end of March or shortly thereafter. 

While the wholesale turnover of the Commission in 2018 and a month-long shutdown may have slowed the agency’s pace, the Chairman has made clear that he sees the FTC as an active enforcer as the calendar moves into 2019. 

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