National Automobile Dealers Association chairman Charlie Gilchrist recently wrote about how data and digital issues remain a high priority for the organization.
And it appears those topics certainly are being monitored by the Federal Trade Commission, too.
Early this week, the regulator announced an Iowa company that sells software and data services to dealers has agreed to take steps to better protect the data it collects, to settle allegations that the firm’s poor data security practices led to a breach that exposed the personal information of millions of consumers.
In a complaint, the FTC alleges that LightYear Dealer Technologies (doing business as DealerBuilt) failed to implement readily available and low-cost measures to protect personal information it obtained from its dealer clients.
“Today’s announcement reflects additional and significant improvements to the FTC’s data security orders that will further protect consumers and deter lax security practices,” FTC chairman Joe Simons said in a news release.
“The settlement with DealerBuilt imposes more specific security requirements and requires company executives to take more responsibility for order compliance, while also strengthening the third-party assessor’s accountability and providing the FTC with additional tools for oversight,” Simons continued.
Officials recapped that DealerBuilt develops and sells dealer-management system software and data processing services to dealers across the country. The software collects large quantities of personal information about dealership consumers, including names, addresses, birth dates and Social Security numbers. Its payroll software collects similar information from dealership employees, along with bank account information.
The FTC alleged that the personal data DealerBuilt collected was stored and transmitted in clear text, without any access controls or authentication protections.
According to the FTC’s complaint, a DealerBuilt employee connected a storage device to the company’s backup network without ensuring that it was securely configured, leaving an insecure connection for 18 months.
The company never performed any vulnerability scanning, penetration testing or other measures that would have detected the vulnerability, according to the complaint.
The FTC also alleged that DealerBuilt failed to take other steps to protect personal data stored on its network such as developing, implementing or maintaining a written information security policy and training for employees; using security measures to monitor its systems and assets; and imposing reasonable data access controls.
The regulator went on to allege these failures led to a breach of DealerBuilt’s backup database beginning in late October 2016 over a 10-day period, when a hacker gained access to the unencrypted personal information of about 12.5 million consumers stored by 130 DealerBuilt customers. The hacker downloaded the personal information of more than 69,000 consumers, including their Social Security numbers, driver’s license numbers and birthdates, as well as wage and financial information.
Officials pointed out DealerBuilt did not detect the breach until it was notified by one of its dealer customers, who demanded to know why its customer data was publicly available on the Internet, according to the complaint. The types of personal information stolen from DealerBuilt — names, addresses and Social Security numbers — are often used to commit identity theft and fraud, the complaint noted.
The FTC alleged that DealerBuilt violated the FTC Act’s prohibition against unfair practices and the Gramm-Leach-Bliley Act’s Safeguards Rule, which requires financial institutions to develop, implement and maintain a comprehensive information security program.
As part of the proposed settlement with the FTC, DealerBuilt is prohibited from transferring, selling, sharing, collecting, maintaining or storing personal information unless it implements and maintains a comprehensive information security program designed to protect the personal information it collects.
Among other things, the order requires DealerBuilt to implement specific safeguards that address the allegations in the FTC complaint.
The proposed settlement also requires the company to obtain third-party assessments of its information security program every two years. Under the order, the assessor must specify the evidence that supports its conclusions and conduct independent sampling, employee interviews, and document review.
In addition, the order requires a senior corporate manager responsible for overseeing DealerBuilt’s information security program to certify compliance with the order every year. Finally, the order grants the Commission the authority to approve the assessor for each two-year assessment period.
The FTC vote to issue the proposed administrative complaint and to accept the consent agreement with DealerBuilt was 5-0.
The regulator reiterated that it issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the FTC that a proceeding is in the public interest.
When the FTC issues a consent order on a final basis, officials explained it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $42,530.
An evaluation project started by the Federal Trade Commission nearly four years ago recently came to a conclusion.
The FTC recently announced that it has completed its review of the Holder Rule, which protects consumers who purchase goods and services using credit obtained through a merchant. This rule impacts “pretty much every aspect of your finance operation,” according to the legal team at Hudson Cook that compiled the eighth edition of CARLAW.
As part of its systematic review of all its rules and guides, the FTC recapped that back in November 2015, the agency sought public comment on the Holder Rule, including its efficiency, the costs and benefits of the rule and its impact.
Officials explained the rule, formally called the “Trade Regulation Rule Concerning Preservation of Consumers’ Claims and Defenses,” protects consumers when they purchase personal goods or services with money loaned by a merchant or by a lender who works with a merchant. The rule requires that such loans include a provision that preserves consumers’ ability to raise the merchant’s misconduct as a reason for not repaying the loan, even if the loan is sold.
The regulator went on to note the Rule prevents businesses from using financing mechanisms to collect debts from consumers in situations where the debt arises from a sale in which the merchant defrauded customers, failed to deliver the goods or services or engaged in other misconduct.
The FTC said it received 19 comments, all of which urged retaining the rule. After reviewing the comments, the FTC found that there is a continuing need for the rule and the record did not warrant a rulemaking to modify the rule.
Officials specifically restated a 2012 advisory opinion that affirmed that the remedies that the rule provides are not limited to circumstances where the seller’s conduct warrants rescission of the contract, or where the goods or services sold to the consumer are worthless.
The commission voted 5-0 to approve publication of rule confirmation in the Federal Register.
The Federal Trade Commission recently offered six recommendations to dealerships and auto finance companies that might receive subpoenas and civil investigative demands (CIDs) as part of an investigation into potential law violations
Burke Kappler, an attorney in the FTC’s Office of General Counsel, explained in a recent blog post that the regular subpoenas and CIDs are critical and used deliberately and responsibly to avoid unnecessary burdens on businesses and individuals and consistent with its obligations to enforce the law.
“These requests are legally enforceable demands, and recipients of subpoenas or CIDs need to take their obligation to comply seriously,” Kappler wrote. “We expect all companies and individuals who receive compulsory process to respond completely and in a timely manner, or to disclose quickly and candidly any obstacles to full compliance.
“We routinely work with recipients to narrow or defer requests, and generally, we have found that parties cooperate. But not everyone sees the benefits of cooperation, which can often result in delay,” Kappler continued.
In an effort to make the process go as smooth as possible, Kappler offered these suggestions, including:
— Respond promptly to FTC staff upon receipt of a subpoena or CID.
— Take advantage of meet-and-confer opportunities and be forthcoming about any concerns that you have about your ability to comply on time and in full. In meetings or calls, bring people who have knowledge and information about the required documents and information and the efforts necessary to produce them. Provide specific and concrete information — not just guesses.
— If you run into problems meeting deadlines, call staff immediately. Keep them apprised so they can work with you. Stay in contact. Don’t let deadlines pass without explanation.
— Understand that the FTC and its staff need to move investigations forward expeditiously. Unsupported requests for extended delays may not be granted.
— Abide by commission orders promptly. If you have filed a petition to limit or quash a CID or subpoena and the commission has ordered some form of compliance, you must do so or risk a potential enforcement action within 30 days of the commission’s deadline.
— Bear in mind that there are many other factors that affect the timing and course of an FTC investigation. Delaying compliance with a CID or subpoena in hopes that you won’t have to comply at all rarely works, and most often results in follow up from the Office of General Counsel.
The Federal Trade Commission on Tuesday said it is seeking comment on proposed amendments to two rules that protect the privacy and security of customer information held by financial institutions.
In separate notices to be published in the Federal Register shortly, the FTC announced that it is looking for comment on proposed changes to the Safeguards Rule and the Privacy Rule under the Gramm-Leach-Bliley Act. The Safeguards Rule, which went into effect in 2003, requires a financial institution to develop, implement and maintain a comprehensive information security program. The Privacy Rule, which went into effect in 2000, requires a financial institution to inform customers about its information-sharing practices and allow customers to opt out of having their information shared with certain third parties.
“We are proposing to amend our data security rules for financial institutions to better protect consumers and provide more certainty for business,” said Andrew Smith, director of the FTC’s Bureau of Consumer Protection. “While our original groundbreaking Safeguards Rule from 2003 has served consumers well, the proposed changes are informed by the FTC’s almost 20 years of enforcement experience. It also shows that, where we have rulemaking authority, we will exercise it as necessary to keep up with marketplace trends and respond to technological developments.”
As part of its periodic review of its rules and guides, the FTC sought comment in 2016 on the Safeguards Rule. In response to this review, and to keep the rule up to date, the FTC is proposing changes to the Safeguards Rule to add more detailed requirements for what should be included in the comprehensive information security program mandated by the rule.
For example, the FTC explained the proposal generally would require financial institutions to encrypt all customer data, to implement access controls to prevent unauthorized users from accessing customer information, and to use multifactor authentication to access customer data. The FTC also has proposed improving compliance with these programs by requiring companies to submit periodic reports to their boards of directors.
The agency indicated the proposed changes would bring the rules into line with changes implemented by Congress through the Dodd-Frank Act in 2010 and the FAST Act in 2015, which modified the annual privacy notice requirement under the Gramm-Leach Bliley Act.
While the scope of the Privacy Rule was narrowed significantly by the enactment of the Dodd-Frank Act, the FTC’s current Safeguards Rule continues to apply to all financial institutions within the FTC’s jurisdiction. The FTC proposes to revise the Safeguards Rule so that the scope of that Rule is clear on its face.
Officials recapped the Dodd-Frank Act transferred the majority of the commission’s rulemaking authority for the Privacy Rule to the Consumer Financial Protection Bureau, leaving the FTC with rulemaking authority only over certain motor vehicle dealers. To address these statutory changes, the FTC has proposed, for example, to remove from the Privacy Rule examples of financial institutions that do not apply to motor vehicle dealers. In addition, the revised Rule would clarify when motor vehicle dealers must provide annual privacy notices to reflect provisions included in the FAST Act.
The FTC also is proposing to expand the definition of “financial institution” in both the Privacy Rule and the Safeguards Rule to specifically include so-called “finders,” those who charge a fee to connect consumers who are looking for a loan to a lender. Officials indicated this proposed change would bring the commission’s rule in line with other agencies’ interpretation of the Gramm Leach Bliley Act.
The FTC reiterated the notices seeking comment on the proposed changes to the Safeguards Rule and to the Privacy Rule will be published in the Federal Register soon. Instructions for filing comments appear in the published notices. Comments must be received 60 days after publication in the Federal Register. Once processed, comments will be posted on Regulations.gov.
The commission vote to submit the Privacy Rule notice for publication in the Federal Register was 5-0. The commission vote to submit the Safeguards Rule notice for publication in the Federal Register was 3-2. Commissioners Noah Joshua Phillips and Christine Wilson issued a dissenting statement that’s available here.
Along with explaining three reasons for their objections, Phillips and Wilson closed their statement by saying, “This is a notice of proposed rulemaking (NPRM), and the commission is merely proposing new regulation and soliciting views on its impact. But we are also aware that the momentum behind an NPRM regularly results in the promulgation of new or revised rules.
“While the commission is not making a final determination today, we are concerned that the specific suggestions herein will frame the debate so as to take the commission in a direction that may be unwarranted (particularly given the prospect of legislation), and which may have negative repercussions,” they continued.
“A review of the Safeguards Rule, especially in light of new legal developments, is warranted. But we should go where the evidence today leads us. We would strongly encourage those in industry, academia, and civil society with expertise in these areas to comment and provide evidence on this proposal,” they went on to say.
According to the newest update from the Federal Trade Commission, checks literally are in the mail for customers of a California dealer group that settled with the regulator last year.
The FTC said it is mailing 43,456 checks totaling more than $3.5 million to consumers subjected to deceptive and unfair sales and financing tactics by the Sage Auto Group and its owners between 2014 and 2016. Officials indicated affected consumers will receive their checks soon with the average refund amount totaling $81.76.
In September 2016, the FTC charged nine Los Angeles-area dealerships and their owners with using a wide range of deceptive and unfair sales and financing practices. The FTC’s action, filed in the U.S. District Court for the Central District of California, sought to end these practices and return money to consumers.
The regulator explained the action against the Sage Auto Group defendants was the FTC’s first to charge a dealer for “yo-yo” financing tactics: using deception or other unlawful pressure tactics to coerce consumers who have signed contracts into later accepting a different deal.
The FTC also alleged that the defendants packed extra, unauthorized charges for “add-ons,” or aftermarket products and services, into contracts financed for consumers.
In addition to barring the allegedly illegal conduct, the March 2017 order settling the FTC’s charges required the defendants to pay approximately $3.6 million for return to affected consumers.
The FTC added recipients should deposit or cash checks within 60 days, as indicated on the check.
“The FTC never requires consumers to pay money or provide account information to cash a refund check,” officials said, noting that impacted consumers will receive a percentage of their total add-on costs for vehicles they bought.
The Federal Trade Commission called for a balanced approach that protects both consumer privacy and innovation in a comment submitted to the Department of Commerce’s National Telecommunications and Information Administration (NTIA) as part of that agency’s consumer privacy proceeding.
In its comment to NTIA, the FTC emphasized its extensive experience in protecting consumer privacy and fostering innovation. The regulator reiterated its main tasks in this sphere, including:
— Collecting information from children online without parental consent
— Deceiving consumers about collection, use, and/or disclosure of their financial, health, video, or other personal information
— Making false promises about compliance with the EU-U.S. Privacy Shield (and the predecessor U.S.-EU Safe Harbor)
— Deceptively tracking consumers online
— Disclosing highly sensitive, private consumer data to unauthorized third parties
— Publicly posting private data online without consumers’ knowledge or consent
— Installing spyware or other malware on consumers’ computers
— Failing to provide reasonable security for consumer data, including children’s information
— Spamming and defrauding consumers
— Making harassing calls about phantom debt and leaving threatening voicemails about debt collection
— Failing to comply with legal requirements when generating automated data used to deny housing to applicants
— Violating Do Not Call and other telemarketing rules
“These enforcement actions send an important message: the FTC holds companies accountable for their information practices,” officials said in their comment to the NTIA that’s available here.
“The FTC is uniquely situated to balance consumers’ interests in privacy, innovation and competition, according to the comment,” the regulator continued. “In particular, the FTC’s dual mission of protecting competition and consumer protection gives the commission a deep understanding of the benefits and costs to consumers associated with the use of their data.
In response to some of the specific topics raised by NTIA, the comment also reiterated the FTC’s commitment to data security. The comment summarized the importance of companies’ making accurate disclosures about privacy.
The FTC went on to maintain a call for a balanced approach to choice, where the level of control would depend on consumer preferences, context and risk. Officials noted that they should continue to be the primary enforcer of laws related to information flows in the marketplace, whether under the existing or a new privacy and security framework.
The regulator added that it will be examining its current authority related to privacy and data security as part of its series of hearings on Competition and Consumer Protection in the 21st Century.
“Data security concerns are an important part of the privacy debate and, in light of the issues described above, the FTC continues its longstanding call that Congress consider enacting legislation that clarifies the FTC’s authority and the rules relating to data security and breach notification,” officials said. “The FTC also understands that both Congress and the administration are considering federal privacy legislation, and the commission strongly supports those efforts.
“Any legislation should balance consumers’ legitimate concerns about the protections afforded to the collection, use, and sharing of their data with business’ need for clear rules of the road, consumers’ demand for data-driven products and services and the importance of flexible frameworks that foster innovation,” the FTC continued. “Should Congress decide to pursue such legislation or otherwise expand the FTC’s enforcement authority, the commission is prepared to share its expertise and assist with formulating appropriate legislation.
“That said, any such process will involve difficult value judgements that are appropriately left to Congress,” officials went on to say. “Ultimately, no matter the specific laws Congress enacts in the privacy or data security area, the commission commits to using its extensive expertise and experience to enforce them vigorously, consistent with its ongoing and bipartisan emphasis on privacy and security enforcement.”
The Federal Trade Commission announced consumers — especially individuals who are trying to repair their credit profiles and are concerned about identity theft or data breaches — can freeze their credit and place one-year fraud alerts for free.
Under the new Economic Growth, Regulatory Relief, and Consumer Protection Act, the FTC explained consumers in some states — those who previously had to pay fees to freeze their credit — will no longer have to do so.
Officials noted that a credit freeze, also known as a security freeze, restricts access to a consumer’s credit file, making it harder for identity thieves to open new accounts in the consumer’s name. The new law also allows parents to freeze for free the credit of their children who are under 16, while guardians, conservators and those with a valid power of attorney can get a free freeze for their dependents.
In addition, the FTC said the new law extends the duration of a fraud alert on a consumer’s credit report from 90 days to one year. A fraud alert requires businesses that check a consumer’s credit to get the consumer’s approval before opening a new account.
As part of its work to implement the new law, the Federal Trade Commission has updated its IdentityTheft.gov website with credit bureau contact information in an attempt to make it easier for consumers to take advantage of the new provisions outlined in the law.
To place a credit freeze on their accounts, consumers will need to contact all three nationwide credit bureaus: Equifax, Experian and TransUnion. Whether consumers ask for a freeze online or by phone, the credit bureau must put the freeze in place within one business day.
When consumers request to lift the freeze by phone or online, the credit bureaus must take that action within one hour. (If consumers make these requests by mail, the agency must place or lift the freeze within three business days.)
To place a fraud alert, consumers need only contact one of the three credit bureaus, which will notify the other two bureaus.
The regulator insisted credit freezes and fraud alerts are two important steps consumers can take to help prevent identity theft. Identity theft was the second biggest category of consumer complaints reported to the FTC in 2017 — making up nearly 14 percent of all the consumer complaints filed last year.
Consumers who believe they have been the victim of identity theft can report it and receive a personalized recovery plan at IdentityTheft.gov.
Here is some good news for auto finance companies involving ongoing concern about fraudulent paper ending up in their portfolios.
The operators of websites that sold fake documents used to facilitate identity theft and other frauds have agreed to permanently shut down their businesses as part of separate settlements with the Federal Trade Commission.
In separate cases filed by the FTC, the commission alleged that Katrina Moore, Steven Simmons and George Jiri Strnad II and their affiliated companies operated websites that sold customers a variety of fake financial and other documents — such as pay stubs, income tax forms and medical statements — that can be used to facilitate identity theft, tax fraud and other crimes.
“The sale of fake documents makes it easy for identity thieves and scammers to ply their trade,” said Andrew Smith, director of the FTC’s Bureau of Consumer Protection. “This action demonstrates the FTC’s determination to stop those who help people to commit identity theft and fraud.”
Identity theft was the second biggest category of consumer complaints reported to the FTC in 2017 — accounting for nearly 14 percent of all the consumer complaints made last year. Credit card fraud was the most common type of identity theft reported by consumers in 2017, followed by tax fraud.
The complaint against Moore and her business, Innovative Paycheck Solutions, alleges that she promoted the sale of a variety of financial documents on the website she operated, FakePayStubOnline.com. In addition to fake pay stubs, these documents included bank statements and profit-and-loss statements.
The site stated that the documents look authentic and sold for as little as $40 for a fake pay stub to more than $150 for fake tax returns. The site offered visitors the choice to customize their documents and to edit real bank statements, touting its “Custom Fake Pay Stub” and “Fake Pay Stubs Online, Quick, Easy, Accurate Pay Stubs.”
In its complaint against Simmons and his business, Integrated Flight Solutions, the FTC alleged he operated the NoveltyExcuses.com website from 2013 until October 2017, where for $19.95 he sold a variety of financial, identity and medical documents including pay stubs, auto insurance cards, utility and cable bills, doctor’s excuses and medical absence reports.
Like Moore’s website, Simmons’ NoveltyExcuses.com advertised that the documents the site offered were fake but looked authentic, saying it could provide “Quality Authentic Fake Forms! Proven to Work!”
From about 2014 through March of this year, the FTC said Strnad operated similar websites, including PayStubDirect.com and PaycheckStubOnline.com, that offered fake pay stubs, tax forms and bank statements, according to the FTC’s complaint. His iVerifyMe website sold job verification services in which he claimed to verify employment and income for customers, the FTC alleged.
As with the other defendants, the regulator indicated Strnad’s websites advertised that the documents were fake but looked “authentic.” At the same time, his iVerifyMe site advertised that it could verify the employment claims made using the fake pay stubs offered from his other websites, according to the FTC.
The FTC noted in all three complaints that fake financial and identification documents can be used to commit identity theft and loan fraud. Identity thieves can use fake documents to apply for credit cards along with stolen personal information. When an identity thief fails to pay the credit card bill, the victim’s credit suffers.
The sites offered by the defendants claimed that the fake documents were for “novelty” and “entertainment” purposes but failed to clearly and prominently mark such documents as being for such purposes and did not state on the documents themselves that they were fake, according to the complaints.
The agency alleged Moore, Simmons and Strnad violated the FTC Act’s prohibition against unfair practices.
As part of her proposed settlement with the FTC, Moore is permanently prohibited from advertising, marketing or selling any fake documents or services and providing any means to others to make misrepresentations about an individual’s identity, finances, residency, taxes or employment. She also has agreed to pay $169,000, all of which is suspended due to her inability to pay.
In his proposed settlement, Simmons agreed to similar conduct prohibitions and to pay $15,000, which also has been suspended due to his inability to pay. The full amount will become due if either defendant is later found to have misrepresented their finances. Strnad agreed to similar conduct restrictions in his proposed settlement and to pay $133,777.
The FTC voted 5-0 to approve the three complaints and stipulated final orders. The FTC filed the proposed order with Moore in the U.S. District Court for the Central District of California, while the proposed order with Simmons was filed in the U.S. District Court for the District of Oregon, Portland Division and the proposed order with Strnad was filed in the U.S. District Court for the Southern District of Texas, Houston Division.
Embellishing “stips” to enhance the figures sent to finance company underwriting departments landed a quartet of dealerships in trouble with a top federal regulator.
This week, the Federal Trade Commission charged a group of four dealers operating in Arizona and New Mexico, near the border of the Navajo Nation, with a range of illegal activities, including falsifying consumers’ income and down payment information on vehicle financing applications and misrepresenting important financial terms in vehicle advertisements.
Officials pointed out this development is the FTC’s first action alleging income falsification by dealers.
The complaint also names the dealerships’ owner and manager, Richard Berry, as a defendant; and owner and president, Linda Tate, as a relief defendant.
According to the complaint, since at least 2014, Tate’s Auto has sought to increase its sales by falsifying consumers’ monthly income and down payments on financing applications and contracts submitted to third-party financing companies. The four dealerships named in the complaint are Tate’s Auto Center of Winslow, Tate’s Automotive, Tate Ford-Lincoln-Mercury and Tate’s Auto Center of Gallup.
The FTC charges that, during the sales process, Tate’s Auto asked consumers to provide personal information — including their name, address and monthly income — and told consumers they would submit the information to financing companies. According to the complaint, however, instead of using consumers’ actual information, in many cases Tate’s Auto falsely inflated the numbers, making it appear that consumers had higher monthly incomes than they really did.
Tate’s Auto often inflated the amount of a consumer’s down payment as well, according to the complaint.
The complaint also alleges that Tate’s Auto representatives often prevented consumers from reviewing the income and down payment information on the forms, such as by rushing consumers through the process of reviewing and signing the financing applications, having consumers fill out the forms over the phone and failing to give them the income and down payment portion of the application before they signed.
In other cases, the FTC said Tate’s Auto allegedly altered financing documents after consumers signed them, without their knowledge. Such consumers, the FTC alleges, often were approved for financing based on the false information Tate’s Auto provided.
As a result, financing companies extended credit to consumers who defaulted at a higher rate than qualified buyers. Many of the affected consumers are members of the Navajo Nation, according to the FTC.
The complaint also alleges that Tate’s Auto’s advertising deceived consumers about the nature and terms of financing or leasing offers. For example, Tate’s Auto allegedly advertised discounts and incentives to consumers without adequately disclosing limitations or restrictions that would prevent many customers from qualifying for them.
Finally, the FTC alleges that Tate’s Auto’s social media ads violated federal law by failing to disclose required terms.
The complaint charges Tate’s Auto with violating the FTC Act, the Truth in Lending Act (TILA) and the Consumer Leasing Act (CLA). The FTC is seeking an injunction barring the defendants from such practices in the future.
According to the FTC, acting as owner of the four dealerships, Barry formulated, directed, controlled, had the authority to control, or participated in Tate’s Auto’s allegedly illegal conduct.
The FTC charged that Tate has received hundreds of thousands of dollars from the other defendants, including funds directly connected to the alleged unlawful conduct.
The commission vote authorizing the staff to file the complaint was 5-0. The complaint was filed in the U.S. District Court for the District of Arizona.
“Buying a car is one of the biggest purchases consumers make. When consumers tell an auto dealer how much they make and how much they can pay upfront, the dealer can’t turn those facts into fiction,” said Andrew Smith, director of the FTC’s Bureau of Consumer Protection.
“The FTC expects auto dealers to be honest with consumers from the first advertisement to the final purchase,” Smith added.
The FTC reiterated that it files a complaint when it has “reason to believe” that the law has been or is being violated and it appears to the regulator that a proceeding is in the public interest. The case will be decided by the court.
New leadership officially took control of the Federal Trade Commission.
Earlier this week, Joseph Simons was sworn in as chairman of the FTC.
President Trump named Simons, a Republican, to a term on the commission that expires Sept. 25, 2024, and designated him as chairman.
Simons was confirmed by the U.S. Senate on April 26.
“It is a great honor to lead the FTC, an agency that plays a key role in protecting American consumers and promoting competition in the U.S. economy,” Simons said. “I want to express my gratitude to acting chairman (Maureen) Ohlhausen for her outstanding work as head of the commission for the last 15 months, and for her continued service as a commissioner. I am excited to work with such an accomplished group of incoming commissioners, as well.”
Simons noted that, under Ohlhausen’s leadership, the FTC continued vigorous competition and consumer protection enforcement, including in the high tech and health care arenas. The agency brought more than 18 privacy and data security cases, including Lenovo, V-Tech and Ashley Madison.
Ohlhausen also strengthened the agency’s understanding of informational injuries and advocacy for occupational licensing reform through the development of her signature economic liberty initiative and furthered many process and regulatory reforms.
In addition to Simons, the Senate confirmed four others who were nominated by Trump to serve as commissioners. Three of them, Republican Noah Phillips, and Democrats Rebecca Kelly Slaughter and Rohit Chopra, are expected to be sworn in later this week.
The fourth, Republican Christine Wilson, was appointed to fill the seat currently held by Ohlhausen, and she will take office when Ohlhausen leaves the agency.
Prior to becoming FTC chairman, Simons was a partner and co-chair of the Antitrust Group at the law firm of Paul, Weiss, Rifkind, Wharton & Garrison.
Simons has held two previous positions at the commission. He served as director of the FTC’s Bureau of Competition between 2001 and 2003, during which he was responsible for overseeing the re-invigoration of the FTC’s non-merger enforcement program.
In an earlier stint at the commission in the 1980s, Simons served as the FTC’s Associate Director for Mergers and the Assistant Director for Evaluation. Simons earned the FTC’s Award for Meritorious Service.
