Herring calls on Congress to protect consumers

A coalition of 29 state attorneys general is taking action to support the ability of the Federal Trade Commission to successfully combat fraudulent and anticompetitive conduct.

In a letter to congressional leaders, the group, including Virginia Attorney General Mark Herring, expressed their strong support for the Consumer Protection and Recovery Act (H.R. 2668), which would ensure the ability of the FTC to obtain equitable monetary relief, including restitution for consumers and disgorgement of ill-gotten gains, after a U.S. Supreme Court decision changed established practice earlier this year.

“States and state attorneys general play a critical role in antitrust enforcement and putting a stop to fraudulent conduct, but federal help and partnership are also crucial to these efforts,” Herring said. “A comprehensive approach that includes both state and federal efforts is so important in protecting consumers, which is why I’m calling on Congress to pass the Consumer Protection and Recovery Act, giving the FTC more tools to go after wrongdoers.”

For 40 years, the FTC was able to obtain equitable monetary relief by suing wrongdoers in district court. In fact, in the last five years alone, the FTC successfully recovered over $11.2 billion in refunds for consumers though court actions.

But this all changed with the Supreme Court’s April 2021 decision in AMG Capital Management, LLC, et al. v. Federal Trade Commission, which limited the ability of the FTC to recover money for injured consumers.

The FTC is an important partner to states as they police anticompetitive, unfair, and deceptive trade practices. The lack of authority to seek equitable monetary relief, directly in court proceedings, undermines the FTC’s efforts to combat unfair and deceptive practices.

Herring and his colleagues make clear in their letter today that this, in turn, forces states to divert resources away from other consumer protection efforts and perform duties that were previously fulfilled by the FTC.

Unfair and deceptive trade practices are a serious problem in the United states and the COVID-19 pandemic has led to an uptick in consumer complaints. Likewise, unfair competitive practices have dire and adverse impacts on consumers and businesses.

Monopolization, collusion, and other unlawful conduct threaten the proper functioning of the American marketplace and cost consumers and responsible businesses billions of dollars each year. Curtailing the remedies available to the FTC enables bad actors to keep their ill-gotten gains, thereby emboldening wrongdoers and incentivizing unlawful conduct.