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Consumer Protection

Truthful Advertising

In order to make informed purchases, consumers need to have accurate information regarding the product or service they are considering buying. Several federal laws require manufacturers to disclose information that potential buyers need to make purchasing decisions. For example, the Fair Packaging and Labeling Act of 1966 is responsible for ensuring that labels carry information such as the product's quantity and ingredients. The Truth in Lending Act of 1968 mandates that applicants for credit loans be given accurate and clear information regarding the cost and terms of the loan they have applied for. Individual states have enacted consumer packaging laws as well. For instance, in order for consumers to compare the costs of products, many states have regulations that require supermarkets to show item cost based on unit measurements, such as weight or count.

The Federal Trade Commission (FTC) is the federal agency responsible for ensuring that advertising is not false or misleading. In addition, the FTC regulates interstate business and enforces consumer protection laws. The FTC has the authority to make companies withdraw any false advertising and may require the company to correct the misleading ads.

Private organization also provide services to aid consumers in making sound purchasing decisions. One of the most well known of these organizations is the nonprofit Consumers Union of United States, Inc. Consumers Union was established in 1936 and conducts impartial private tests on a wide range of goods and services. It then disseminates the test results in a variety of formats, including the periodical Consumers Reports. On a worldwide basis, the International Organization of Consumers Union (IOCU) is a network of over 125 organizations in more than 50 countries that provides an international platform for consumer protection and product testing.

Additional topics

Law Library - American Law and Legal InformationGreat American Court CasesConsumer Protection - History, The Uniform Commercial Code, Product Safety, Truthful Advertising