Despite promises of more vigorous enforcement, the Federal Trade Commission lags far behind state authorities in pursuing and penalizing false advertisers, a consumer advocacy group said.
The Center for Science in the Public Interest released results of a study Monday that concluded the FTC takes fewer actions against false and deceptive advertisements, takes longer to stop such ads and levies smaller monetary penalties than do state attorneys general in the same cases."It is shocking that the federal government is not able to protect the public from dishonest advertising as well as state agencies," said CSPI Legal Affairs Director Bruce Silverglade.
The study, which looked only at 1990, showed the FTC took enforcement action in 29 deceptive advertising cases, compared with 48 cases by the states. The advertisers were made to pay costs or civil penalties in 75 percent of the state cases brought or settled, but the FTC assessed monetary penalities in only 21 percent of its cases, according to the CSPI.
"When the FTC and state attorney general offices looked at the very same (deceptive) ads," Silverglade said, "the FTC took longer in five out of five cases to settle those cases. . . . In four of five cases the FTC assessed smaller penalties."
As an example, Silverglade said in June 1990, 10 states settled a case against CPC International Inc., the maker of Mazola corn oil and margarine, in which the company agreed to stop making misleading health claims and paid the states a total of $100,000. The FTC took seven months longer to resolve its case against the company and did not levy any monetary penalty.