Consumer Protection
Agencies
Introduction to Business & Marketing
Consumer Protection Agencies
 Find solutions for consumer problems
 Most consumers solve problem themselves:
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Contact the seller customer service
Contact seller headquarter
 Contact consumer organizations
 End all – file claim in small claims court
Types of Consumer Protection Agencies
Nongovernmental
Consumer Organizations:
 The Consumer Federation of
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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
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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 consumers
 Consumer 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 consumers
 Lets members know they can support legislation to
help the public
National Consumers League
 Nations oldest nonprofit consumer group
 Membership open to anyone
 Provides gov’t agencies, businesses, other
organizations with consumer point of view
 National Fraud Information Center
 Monitors Internet to alert consumers of fraud
Consumers Union
 Nonprofit organization that publishes Consumer
Reports magazine
 Researchers test products & report findings
 Testifies before gov’t agencies on consumer concerns
Major Appliance Consumer Action Program
 Association of Home Appliance Manufactures
 Most major appliance dealers are members
 MACAP helps consumers solve problems with large
appliances:
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Washers
Freezers
Stoves
The Media
 Internet sites, radio, TV stations, newspapers
advocate for consumers
 Often have consumer reporters who report issues
importation to consumers:
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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 division
 In some states, Attorney General’s office handles
consumer affairs
 Set up to protect consumers
 Publish materials to help consumers with buying
decisions and problems
 The 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 companies
 Seeks to ensure nations markets function
competitively
 Works to eliminate unfair or deceptive practices
US Department of Agriculture
 USDA inspects foods and grades them
 Grade labels: indicate the level of quality of foods
 EXAMPLE: 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 Transportation
 Agency sets and enforces safety standards for motor
vehicles
 Can 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 pricing
 Public 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:
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Research the recall of the Fitbit Force:
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What impact does this recall have on the company?
What should consumers do if they own this product?
How will this recall impact consumer perception of the company?
Research the recall of your choice of one additional product:
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2.
3.
What impact does this recall have on the company?
What should consumers do if they own this product?
How will this recall impact consumer perception of the company?
Students are to visit http://www.nhtsa.gov/ and complete the following:
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Click on Distracted Driving and read about this campaign
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What are the 3 main types of distractions when you drive?
List 3 ways you can be distracted while driving (not counting texting) – do
you believe these actions really distract the driver?
How can you as a high school student get involved?
What are the Distracted Driving laws in Virginia?