Chapter #7

Consumer Protection

Section #7.1

Laws to Protect Consumers

Describe your rights as set forth in the Consumer Bill of Rights.

Describe the protections provided by major federal consumer protection laws.

Section Goals

The Consumer Bill of Rights outlines basic rights that consumers should expect in the marketplace, including:The right to safety.The right to be informed.The right to choose.The right to be heard.The right to redress.The right to consumer education.

The Consumer Bill of Rights

Some laws set standards for product purity and safety.

These laws include:Food, Drug, and Cosmetic Act of 1938Flammable Fabrics Act of 1953

Flammability:The capacity for catching on fire.

Meat Inspection LawsKefauver-Harris Drug Amendment of 1962

Generic Drugs:Medications with the same composition as the equivalent

brand-name drugs, but they are generally less expensive.National Traffic and Motor Vehicle Safety Act of 1966

Federal Product Purity and Safety Laws

Many consumer laws set rules for product labeling.

These laws include:Hazardous Substances Labeling Act of 1960

Recall:A request for consumers to return a defective product to

the manufacturer.Cigarette Labeling and Advertising Act of 1965Fair Packaging and Labeling Act of 1966Permanent Care Labeling Rule of 1972

Care Labels:Give instructions for cleaning, wash and dry temperature,

and other care needed to preserve the product.

Federal Labeling Laws

Several consumer protection laws are designed to protect children from harm.

These laws include:Child Protection and Toy Safety Act of 1966

Childproof Devices:Devices designed to resist tampering by young

children.Toy Safety Act/ Generic Drug Act (1984)Children’s Online Privacy Protection Act of

1998.

Federal Children Protection Laws

FERPA and HIPAA are laws designed to protect privacy.Family and Educational Rights and Privacy Act

(FERPA)Health Insurance Portability and Accountability

Act (HIPAA)

Federal Privacy Laws

Section #7.2

Agencies to Protect Consumers

Identify national sources of consumer information and assistance.

List and describe state and local agencies and private consumer assistance.

Explain how to contact public officials to express opinions.

Section Goals

Department of Agriculture: Inspects and grades food.

Food and Drug Administration: Approves new drugs, tests products for safety, and sets labeling

guidelines. Consumer Product Safety Commission:

Enforces product standards and bans or recalls hazardous products. Federal Communications Commission:

Regulates communications by radio, television, wire, satellite, and cable. Federal Trade Commission:

Regulates methods of competition, marketing practices, and credit reporting.

United States Postal Inspection Service: Investigates consumer problems pertaining to illegal use of mail.

Fraud: The intentional misrepresentation of information with the intent to deceive or mislead.

Securities and Exchange Commission: Requires businesses to disclose certain information for investors to

evaluate and oversees the securities markets.

Federal Sources of Consumer Protection

Private organizations, such as the Better Business Bureau, can assist consumers with incidents of unethical or illegal practices.

Consumer Advocate:A person who actively promotes consumer

causes.

Private Sources of Consumer Protection

Public officials can also impact consumer protection laws.

To inform public officials of a consumer problem, you can reach them in several ways, including:In personBy phoneBy e-mailBy letter

The Public Official’s Role

Ryan, J.S. (2006). “Managing your personal finances; 5th ed.” Thomson South-Western; Mason, Ohio.

Bibliography