Chapter 15.1 Outline

Carigan Byrd

The Development of Consumer Protection Law

  • Back in the day, a the rule was Caveat emptor, which translates to "Buyers beware". So basically, if you bought something you better be aware that it could malfuntion and hurt you.
  • Nowadays we have laws that protect you against that. If your equipment malfunctions, then the person you bought it from has a lawsuit on their hands. The new phrase is Caveat venditor.

Federal and State Consumer Protection Laws

consumer protextion laws protect you, and these are the folling ways:

  • State consumer protection offices provide information and help enforce the laws within the state.
  • Federal consumer protection law applies to businesses that sell real estate, goods, or services in interstate commerce.

Unfair and Deceptive Practices

These fall into different categories:

  • Fraudulent misrepresentation: A statement that deceives the buyer. Basically when the seller tells you stuff about your product that isn't true.
  • Work-at-home Schemes: Ever see a work-at-home ad in the paper promising you hundreds without leaving your home? Before you accept, be careful. You may have to work hours without pay, or pay for newspaper ads and all your supplies.
  • Unordered Merchandise: If you ever receive something that you didn't order in the mail, then its yours free of charge. Its not legal for someone to send you something you didn't order and then bill you for it!

False Advertising

  • Bait and Switch Advertising: Sellers advertise bargains that aren't real to get you to the store, so you'll buy other expensive things. This actually is illegal and any businesses doing it are breaking the law.

FTC Trade Regulation Rules

  • Negative Option Rule: When you sign up for a subscription, the seller must tell you all details concerning price, how to cancel, deadlines, length of subscription, notifications, and when you get credit for return of a selection.
  • The Cooling-Off Rule: If you buy something that isn't at the seller's permanent location, you have three business days to cancel the contract. This rule applies to purchases of 25$ or more.
  • Telemarketing Sales Rule: This rule protects you from Telemarketers. If you tell a telemarketer to stop calling, by law they must or they can be reported to your state Attorney General. The calls must be between 8 a.m and 9 p.m. They must tell you the total cost. They can't withdraw money from your checking account without your permission. You don't have to pay for credit repair should something go wrong.
  • 900-Telephone-Number Rules: Unlike 800 area codes, if you call a 900 number you're charged for the call. You must be warned about the charge of a call and given the chance to hangup before you are charged.
  • Shopping by Mail, Telephone, Fax, or Internet: When you do this, sellers have to ship the products by the time they advertise. If no time is specified it must be within thirty days. They must notify you of delay in shipment.