Consumer Protection Agencies

Introduction to Business & Marketing

Consumer Protection Agencies

Find solutions for consumer problemsMost consumers solve problem

themselves: Contact the seller customer service Contact seller headquarter

Contact consumer organizationsEnd all – file claim in small claims

court

Types of Consumer Protection Agencies

Nongovernmental Consumer

Organizations: The Consumer Federation of

America National Consumers League Consumers Union Major Appliance Consumer

Action Program The Media

Government Consumer Organizations:

The Federal Trade Commission

US Department of Agriculture The Food And Drug

Administration National Highway Traffic

Safety Administration Consumer Product Safety

Commission State Public Utilities

Commissions State Insurance Commissions State Licensing Agencies

Nongovernmental Consumer Organizations

Work on behalf of consumersConsumer Advocate: groups and individuals

work to protect, inform, and defend consumers

Many consumer advocates are private, nonprofit groups

The Consumer Federation of America

Works to inform the public & gov’t about consumer issues

Works with public officials to promote polices that benefit consumers (ensure fair/balanced debate about issues important to consumers)

Studies federal laws that affect consumersLets members know they can support

legislation to help the public

National Consumers League

Nations oldest nonprofit consumer groupMembership open to anyoneProvides gov’t agencies, businesses, other

organizations with consumer point of viewNational Fraud Information CenterMonitors Internet to alert consumers of fraud

Consumers Union

Nonprofit organization that publishes Consumer Reports magazine

Researchers test products & report findingsTestifies before gov’t agencies on consumer

concerns

Major Appliance Consumer Action Program

Association of Home Appliance Manufactures Most major appliance dealers are membersMACAP helps consumers solve problems with

large appliances: Washers Freezers Stoves

The Media

Internet sites, radio, TV stations, newspapers advocate for consumers

Often have consumer reporters who report issues importation to consumers: Product Safety, Testing, Shopping

Reporter might feature local business problem and visit the location to solve problem

Government Consumer Organizations

Each state has a consumer affairs divisionIn some states, Attorney General’s office

handles consumer affairsSet up to protect consumersPublish materials to help consumers with

buying decisions and problemsThe Federal Citizen Information Center is a

good source for consumer information

The Federal Trade Commission

FTC enforces federal antitrust and consumer protection laws

Investigates complaints against companiesSeeks to ensure nations markets function

competitivelyWorks to eliminate unfair or deceptive

practices

US Department of Agriculture

USDA inspects foods and grades themGrade labels: indicate the level of quality of

foodsEXAMPLE: meat can be labeled ‘prime’ or

‘choice’Consumers use grade as a guide for what to

buy

The Food And Drug Administration

FDA regulates the labeling and safety of food, drugs, cosmetics, dietary supplements, and medical devices sold in the US

FDA tests and approves all drugs before they can be offered to consumers

Reviews products already on the market

National Highway Traffic Safety Administration

Part of the US Department of TransportationAgency sets and enforces safety standards for

motor vehiclesCan require an automaker to issue recall Recall: order to take back & repair or replace

a product that has defective parts

Consumer Product Safety Commission

Oversees the safety of products such as toys, cribs, power tools, electronics, furniture

Contributed to a 30% decline in deaths/injuries associated with consumer products over the last 30 years

State Public Utilities Commissions

Regulates the rates charged by electric, gas, and water companies

Also may regulate telephone services in local areas

Protect consumers from unfair pricingPublic utilities are legal monopolies - a

company is allowed to operate without competition

State Insurance Commissions

State government bodies responsible for regulating the activities of insurers and health plans

Control and approve insurance rates

State Licensing Agencies

Issue licenses - legal permits to conduct business

Licenses provide assurance to consumers that license holder is qualified to do a service

Doctors, teachers, roofers, hair stylists require licenses

Activity

Students are to visit http://www.cpsc.gov and complete the following: Research the recall of the Fitbit Force:

1. What impact does this recall have on the company? 2. What should consumers do if they own this product? 3. How will this recall impact consumer perception of the company?

Research the recall of your choice of one additional product:1. What impact does this recall have on the company? 2. What should consumers do if they own this product? 3. How will this recall impact consumer perception of the company?

Students are to visit http://www.nhtsa.gov/ and complete the following: Click on Distracted Driving and read about this campaign

1. What are the 3 main types of distractions when you drive?2. List 3 ways you can be distracted while driving (not counting

texting) – do you believe these actions really distract the driver?3. How can you as a high school student get involved?4. What are the Distracted Driving laws in Virginia?