Letters to Congress: Letter in Support of the Consumer Protection Remedies Act of 2022

View or download a PDF of the letter here.

Tuesday, May 10, 2022  

Senator Maria Cantwell
Committee on Commerce, Science, and  Transportation
United States Senate
Washington, DC 20510 

Senator Roger Wicker
Ranking Member
Committee on Commerce, Science, and  Transportation
United States Senate
Washington, DC 20510 

Re: Consumer Protection Remedies Act of 2022

Dear Chair Cantwell and Ranking Member Wicker, 

The undersigned consumer protection organizations write in support of S. 4145, the  Consumer Protection Remedies Act of 2022. This bill would restore the Federal Trade  Commission’s (FTC) authority to stop misconduct in the marketplace, and critically, to provide  timely refunds and equitable relief to victims of consumer fraud and deception.  

For more than 40 years, the FTC relied on §13(b) of the FTC Act to hold fraudsters and  wrongdoers accountable for violating the law—both by stopping wrongdoers from profiting from  their fraudulent acts, and by ensuring that bad actors repay the consumers and small businesses  they harm. However, the Supreme Court’s 2021 holding in AMG Capital Management, LLC, et  al. v. Federal Trade Commission—that §13(b) does not give the FTC the authority to get such  monetary relief, and that Congress would need to restore the FTC’s ability to refund harmed  consumersseverely diminished the value of this crucial law enforcement tool.  

Without § 13(b) authority, the FTC can no longer effectively strip the ill-gotten earnings  from payday lenders that trick some of the most vulnerable consumers with hidden fees, or send  adequate refunds to small business owners who had money illegally withdrawn from their  accounts by lenders. And this also seriously undermines the FTC’s ability to combat practices of  big tech companies that have taken advantage of their market power to crowd out small  businesses and exploit consumers’ personal data.  

Between October 2016 and the Supreme Court’s holding in April 2021, the FTC refunded  more than $11 billion to at least 12 million wronged consumers across the country.1 And while  the FTC retains authority under §5 and §19 to obtain restitution for consumers, these approaches  are structurally arduous and slow, risking not only the agency’s ability to ultimately ensure that  wronged consumers are indeed repaid, but that victims’ funds are restored in a timely manner. In  an economic moment where 35% of adults would have trouble covering a $400 emergency expense, where consumers nationwide are feeling the pocketbook effects of inflation and price  hikes, consumers cannot afford to wait.2 

Importantly, this bill permits the §13(b) authorities for equitable remedies to all  violations of the FTC Act, without artificial delineations of the types of illegal acts that should  qualify. The FTC has authority to enforce against unfair and deceptive acts and practices, as well  as unfair methods of competition. It should have authority to seek equitable remedies – disgorgement of ill-gotten gains, and restitution for consumer losses – in all cases under its  jurisdiction. Requiring the disgorgement of illegally acquired gains is not punitive, but purely a  matter of making sure that entities defrauding and deceiving consumers nationwide do not get to  retain the profits gained by their illegal acts. Simply: if a business makes money from violating  the FTC Act, it should not be able to keep that money.  

Restoring the FTC’s §13(b) disgorgement and restitution authority is crucial to ensuring  swift repayment to defrauded consumers. The signatories to this letter would also urge the  Committee to consider going further in both authority and funding. Consumers deserve an FTC  empowered with the tools and resources to proactively deter bad actors and keep industries  honest. One such tool would be the authority to obtain civil penalties against the worst actors at  the earliest possible instance, which would provide real teeth to enforcement that would create a  needed deterrent for would-be bad actors. Allowing companies to engage in and profit from  harmful behavior without threat of penalty does not provide sufficient disincentive to prevent  fraud and other ills to consumers. And civil penalty authority would help in part because  unscrupulous actors know there is a relatively low chance of enforcement at present because the  FTC has such tightly limited staff and capacity. Right now, the FTC receives a paltry $431  million dollars annually to keep consumers safe across the $25 trillion dollar economy.3 Congress also needs to provide the FTC with the funding necessary to empower it to accomplish  its sweeping consumer protection and competition missions.  

As a starting point, the FTC must have the authority to obtain monetary and other  equitable relief from those who would harm seniors, veterans, small businesses, and all  vulnerable consumers; and must be able to seek injunctions to stop scams as they occur to  prevent further harms to these same communities. We urge the Committee to refrain from  imposing additional burdensome requirements, such as unduly restricting the statute of  limitations period or requiring a higher standard of proof of wrongdoing. These unnecessary hurdles would undermine the Commission, making its good work more costly and taxing to  achieve, and depriving scam victims of rightful remedies.  

Congress must act to ensure that the FTC can effectively pursue timely remedies for  consumers and discourage predatory scammers and bad actors. We strongly support the  Consumer Protection Remedies Act of 2022, and urge the Committee to pass it swiftly. Thank  you for acting to protect consumers.  


20/20 Vision 

Americans for Financial Reform 

Center for Digital Democracy 

Consumer Action 

Consumer Federation of America  

Consumer Reports 

National Association of Consumer Advocates 

National Consumer Law Center (on behalf of its low-income clients) 

Texas Appleseed 

Truth in Advertising 

Tzedek DC 

UC Berkeley Center for Consumer Law & Economic Justice