Acting FTC Chairman Ohlhausen Reports One Year of Agency Accomplishments

Federal Trade Commission Acting Chairman Maureen K. Ohlhausen released a summary of the agency’s major accomplishments one year after being named to lead the agency. Building upon the work of the first six months of her tenure, the FTC pursued vigorous enforcement of competition and consumer protection laws, promoted economic liberty, and extended the agency’s efforts to protect consumer privacy. The FTC also improved its ranking under the Partnership for Public Service’s “Best Places to Work in the Federal Government” report, from 5th in 2016 to 4th last year among 25 mid-size agencies.

“In the past year, the Commission has actively pursued its mission to protect consumers and promote competition while avoiding undue burdens on legitimate businesses. American consumers, military members and law-abiding businesses deserve and expect nothing less from us. The agency has had a large, positive impact over the last 12 months and we have effectively focused agency resources where they will best serve the public good.”

COMPETITION ENFORCEMENT – In the last year, the FTC filed 10 competition cases in federal or administrative courts and took action in 25 other cases to protect consumers from anticompetitive mergers or business conduct.  In December, the FTC filed to block the merger of two companies with the largest sales of titanium dioxide in North America, a product widely used in paints and coatings. Most recently, the Commission voted to issue an administrative complaint challenging Otto Bock’s consummated acquisition of Freedom Innovations, which combined two of the top sellers of prosthetic knees equipped with microprocessors that provide greater stability and mobility to amputees. The courts continued to validate the Commission’s competition work in federal court in two important health care mergers involving physician services (Sanford/Mid-Dakota Clinic) and hospitals (Advocate/NorthShore).  The FTC also preserved competition for other goods and services that matter to consumers, including pharmaceuticals, medical devices, gasoline, and veterinary services.

CONSUMER PROTECTION ENFORCEMENT – Acting Chairman Ohlhausen continued to focus agency resources on areas that cause the greatest harm to consumers. The agency brought or settled 109 consumer protection matters.  For example, the agency, along with 11 states and the District of Columbia, launched a coordinated federal-state law enforcement initiative, dubbed  “Operation Game of Loans,” to target deceptive student loan debt relief scams. In a victory for the FTC, a federal court ordered Dish Network to pay $280 million in civil penalties and to stop alleged violations of the FTC’s Telemarketing Sales Rule and other federal and state laws. Overall, this past year the FTC filed or settled 85 consumer protection matters in district court, reached 24 administrative consent agreements related to consumer protection, and distributed over $269 million in redress to over 3 million consumers.  In addition, some court orders required the defendants to send refunds directly to consumers, including more than $6 billion returned under the FTC’s settlement with Volkswagen.  In December 2017, the FTC issued the agency’s first Office of Claims and Refunds Annual report, detailing the billions of dollars in consumer redress from the FTC’s work.

ECONOMIC LIBERTY – The Economic Liberty Task Force, convened by Acting Chairman Ohlhausen, expanded the FTC’s cooperation with state and federal leaders to identify and eliminate unnecessary or overbroad occupational licensing restrictions that threaten economic liberty, many of which are particularly harmful to military families who relocate frequently. During the last six months, the Task Force held two roundtables on the effects of occupational licensing restrictions, which include harm to competition, leading to higher prices, lower quality, and reduced consumer access to services and goods. Acting Chairman Ohlhausen also testified before a House Judiciary subcommittee, and hosted Voices for Liberty, a fireside chat  featuring individuals who have been affected by undue occupational licensing restrictions. This week, FTC staff commented on Nebraska legislation aimed at procompetitive reform of the state’s occupational licensing laws and regulations. The FTC also submitted comments to Pennsylvania and Tennessee in support of licensing changes in those states that would spur entrepreneurship and competition, and further benefit consumers.

PRIVACY and DATA SECURITY –The FTC extended its vigorous enforcement efforts to protect consumer privacy and data security, announcing 10 privacy cases and 4 data security cases. For example, along with 32 State Attorneys General, the agency reached a settlement with  Lenovo – one of the world’s largest computer manufacturers – over charges that the company harmed consumers by pre-loading software on some laptops that compromised security protections to deliver ads to consumers. The Commission obtained a settlement of its privacy case against the ride-sharing company, Uber Technologies, Inc., that will require the company to implement a comprehensive privacy program and get regular independent audits. The FTC also obtained $650,000 in a settlement with the electronic toy manufacturer VTech and its U.S. subsidiary over allegations that VTech violated children’s online privacy laws. The Commission also charged TaxSlayer, the operator of an online tax preparation service, with violating federal rules on financial privacy and security and sued the operators of MyEx, a revenge porn website that collects nude or sexually explicit images of individual consumers for posting.

The FTC also stepped up its enforcement of the European Union-United States Privacy Shield framework, settling charges against three U.S. companies for misleading consumers about their participation in the framework. The FTC’s Informational Injury Workshop in December addressed questions such as how to best characterize these injuries, how to measure accurately such injuries and their prevalence, and what factors consumers consider when deciding whether to provide their personal information. The agency published a series of “Stick with Security” blog posts to help businesses ensure they are taking reasonable steps to protect and secure consumer data, and held a joint workshop with the Department of Education to examine Student Privacy and Ed Tech. The agency scheduled its third PrivacyCon conference to encourage the next generation of privacy and data security researchers to explore economic questions in privacy and data security.  For more information about the FTC’s privacy and data security work in 2017, see the just released 2017 Privacy Report.

HEALTHCARE COMPETITION ADVOCACY – The FTC continued its initiative to advance competition in healthcare, using its full range of policy and advocacy tools.  The Commission held a workshop examining competition in prescription drug markets, particularly entry and supply chain dynamics that may prevent competition from keeping prices in check. The agency’s Now Hear This workshop addressed competition, innovation, and consumer protection issues in hearing health care. The FTC also announced a new project to study the impact of certificates of public advantage (COPAs) on prices, quality, access, and innovation for healthcare services. In addition, the agency staff wrote to the state of Georgia in support of Certificate of Need application to build a general hospital in Lee County, which would foster hospital competition in a region where competition is lacking. FTC staff also continued to support independent practice authority for Advanced Practice Registered Nurses (APRNs), part of the agency’s decades-long campaign to spur APRN competition for the benefit of consumers and to promote greater economic opportunity for nurse practitioners. In addition, FTC staff commented in support of a proposed Department of Veterans Affairs rule to provide telehealth services across state lines.

SMALL BUSINESS –The FTC boosted its efforts to provide help and guidance to small businesses by hosting a series of public roundtables in various cities to discuss the challenges facing small businesses in protecting the security of their computers and networks.  The FTC’s Engage, Connect, and Protect Initiative: Small Business and Data Security Roundtables held with the Small Business Administration, other federal partners, industry associations, and small business communities in Cleveland, Des Moines, Charlotte, Dover, and Portland, Oregon provided education and guidance for small businesses on cybersecurity issues. In addition, the FTC released business guidance to help multi-level marketers (MLMs) understand and comply with the law.

REGULATORY REFORM and AGENCY STREAMLINING – The FTC worked to reduce excessive regulations and bureaucracy that create significant burdens on the public. The Commission announced internal process reforms in the agency’s Bureau of Consumer Protection to lessen the burden of information requests and improve transparency in Commission investigations. The FTC Also streamlined the requirements under the Fur, Textile and Wool Labeling Rules, implementing web-based electronic filings of requests to obtain, update, or cancel registered identification numbers (RN) used on product labels. Use of the web-based RN system will streamline the application process for participating businesses and greatly increase the agency’s efficiency in delivering RN services to the public.  The Commission also streamlined filing requirements under the Textile Fiber Products Identification Act.

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