The Federal Trade Commission (FTC) enforces federal antitrust and consumer protection laws to prevent fraudulent, deceptive or anticompetitive business practices. Its toolkit includes research, legislative maneuvering, law enforcement and consumer education and advocacy.

What is the FTC?

The FTC is an independent, bipartisan federal agency tasked with keeping the economy competitive and consumers safe. It’s composed of five Presidentially-nominated, Senate-confirmed commissioners serving seven-year terms. The FTC’s main purpose is enforcing antitrust laws and preventing anticompetitive business practices (like monopolies). It also protects consumers from predatory and fraudulent business practices.

History of the FTC

Woodrow Wilson signed the Federal Trade Commission Act in 1914 to help “bust trusts.” Specifically, the FTC was created to enforce the Clayton Act, which banned giant monopolies from consolidating profits and power.

Gradually, Congress granted the FTC greater authority and passed a broad prohibition against “unfair and deceptive” business practices. Today, the Commission enforces or administers over 70 laws related to:

• Industry-wide trade regulations
• Anti-discrimination consumer protections
• Preventing fraud and price-fixing schemes

What does the FTC do?

The FTC has three main goals:

• Protecting consumers from “unfair or deceptive” business methods
• Promoting fair competition and guarding against anti-competitive practices
• Conducting research, advocacy and education initiatives

Protecting consumers – and the economy

To accomplish these goals, the FTC pursues a variety of avenues. To start, the FTC develops policies and establishes trade regulations specifying taboo practices. Then, it investigates suspicions of fraud, false advertising, monopolistic practices and other instances of noncompliance.

When businesses violate FTC regulations, the Commission may pursue voluntary change or take legislative or law enforcement actions. It may also seek relief for consumers through injunctions, restitutions and civil penalties.

To further its efforts, the FTC also conducts research and shares its expertise with state, federal and international legislatures and agencies. It also holds workshops and conferences and builds tools to educate consumers and businesses.

Bureaus of the FTC

To aid in its work, the FTC operates through several bureaus, like the:

• Bureau of Consumer Protection, which enforces federal laws related to consumer affairs. The agency’s chief areas of concern include: -Advertising and marketing -Privacy and identity protection -Telemarketing fraud -Certain financial products and practices -The National Do Not Call Registry
• Bureau of Competition, which helps regulate and prevent anticompetitive business methods. The Bureau reviews proposed business mergers, enforces antitrust laws and investigates potentially unfair practices.
• Bureau of Economics, which supports the other bureaus by providing expert knowledge related to the economic impacts of the FTC’s operations.

The FTC also maintains an Office of Technology Research and Investigation to assist in tech-related enforcement actions.

The FTC isn’t just for consumers

The FTC doesn’t just protect consumers and businesses; it also safeguards investors’ right to participate in a fair, scam-free economy.

By promoting competitive business practices, the FTC helps ensure your investments gain (or lose) value on equal footing.

The FTC’s anti-fraud activities have even prevented scammers from selling bad investments – and brought relief to investors taken in by scams.