FTC Testifies Before Digital Commerce Subcommittee

In a recent hearing at the U.S. House Energy and Commerce Subcommittee on Digital Commerce and Consumer Protection, Federal Trade Commission representatives made it clear that the agency lacks sufficient resources to protect U.S. consumers.

Rep. Greg Walden (R-OR) called the FTC “one of the top cops on the beat,” and indicated his support for Federal Communications Commission’s authority over both ISPs and tech companies alike. He said that such authority is “critical for enforcing data privacy practices, promoting a free and open internet and protecting consumers from anti-competitive behaviors across the digital ecosystem.” 

FTC Chairman Joseph Simons reaffirmed the agency’s near-term priorities, including consumer privacy and data security, fraud and illegal robocalls.

“In my view, we need more authority” Chairman Simons said.  Commissioner Chopra stated that the ability for rule-making authority would be helpful. “When we do have a rule on the books we are able to ask for civil penalties,” he said. “That’s one reason why rule-making also could create deterrence as well.” He also stated that “development of rules is much more participatory process than individual enforcement actions and also gives clear notice to the marketplace.” 

With respect to process reform, Simons stated that the FTC is reviewing the manner in which it pursues civil investigatory demands. “You have to write them in the right way, you have to get the company to do what it needs to do,” he said. “The way you write it is important and enforcing it is important.” 

Rep. Yvette Clarke asked whether the FTC has the resources necessary to combat privacy and data security concerns. “Truthfully … my answer would be no,” said Chopra. “I do not think we have the resources and authority to confront some of the issues you’re raising, particularly with respect to privacy and data security.”

The hearing can be seen, here.

Richard B. Newman is a regulatory litigation and defense attorney at Hinch Newman LLP focusing on local, state and federal advertising and digital media matters. Follow him on LinkedIn at FTC Defense Lawyer.

Informational purposes only. Not legal advice. Always seek the advice of an attorney. Previous case results do not guarantee similar future result. Hinch Newman LLP | 40 Wall St., 35th Floor, New York, NY 10005 | (212) 756-8777.

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