The Federal Trade Commission

The Federal Trade Commission - And an injury can occur that...

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The Federal Trade Commission (FTC) was established in 1914 by former president, Franklin D. Roosevelt. One of the primary jobs of the Federal Trade Commission is to monitor and regulate advertising. The FTC can investigate claims made in advertising and proceed with disciplinary actions if so required. Most issues surround falsification of testimonials, reviews, and false product and service claims. The punishments can vary depending on the offense and certain exceptions are made. Investigated are the techniques used by advertising agencies and the legality of those practices. There is a test that is used to test the legality of advertising practices. This test came out of the 1972 case of Sperry vs. Hutchinson and was later altered in its testing methods with the 1980 policy statement. (Lipson) This test comes in three parts as defined by the FTC and the Supreme Court: May cause the consumer to be misled More harmful then good to the consumer or competitor
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Unformatted text preview: And an injury can occur that the consumer is unable to prevent from occurring (Lipson) There are also three Truth In-Advertising rules that have been applied under the Federal Trade Commission Act Advertisements: • must be truthful and non-deceptive • must have a evidence to back up their claims • and cannot be unfair (Advertising Practices) When the FTC has been asked or believes that an advertisement is untruthful and falsified in some way they first view the information from the perspective of a consumer that would be interested in such a product or service. (Advertising Practices) Listerine Mouthwash claimed to prevent a cold or sore throat or at least decrease the seriousness of the illness. (Baran 399) This is known as an expressed claim that is expressed directly to the consumer, in this case is considered false. On the other side of the coin, the FTC also looks at what the companies fail to express to the consumer about a product or service....
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