1. Consumer Protection

Consumer Protection

Playlist: 25 Videos: 79 Minutes



Topics: Learning Material

Introduction to Consumer Protection Law
Consumer protection law concerns the body of statutes and regulations protecting consumers against deceptive practices by merchants or service providers. This chapter introduces the concept of consumer protection and its purpose. It then introduces the numerous federal statutes that protect consumers in specific situations. While these are the primary federal consumer protection laws, states often pass consumer protection laws that are more specific and more stringent than the federal protections. For further written and video explanation, discussion and practice questions, see Consumer Protection Law (Intro)

What is “Consumer Protection Law”?
  • Protect consumers from deception or fraud in the marketplace.

⁃ Not businesses.

For further written and video explanation, discussion and practice questions, see What is "consumer protection law"?

Major Federal Consumer Protection Laws
  • Equal Credit Opportunity Act
  • Fair Credit Reporting Act
  • Truth in Lending Act
  • Fair Debt Collection Practices Act
  • Consumer Financial Protection Act
  • Fair Credit Billing Act
  • Electronic Funds Transfer Act
  • Consumer Product Safety Act
  • Manguson-Moss Warranty Act
  • Federal Food, Drug, and Cosmetic Act
  • Various Labeling Laws
  • Privacy Act of 1974
  • Electronic Communication Privacy Act
  • Children’s Online Privacy Protection Act

For further written and video explanation, discussion and practice questions, see What major federal laws protect consumers?

Overview of Regulatory Agencies
  • Regulatory reporting
  • Civil Actions
  • Criminal Actions (Fraud)

In this section, we discuss the administrative agencies charged with a consumer protection mission and the procedures used to carry out that mission. Regulatory Agencies - Overview

The Federal Trade Commission (FTC)
  • “Independent” regulatory agency - promot competition free and fair, and with protecting consumers.
  • Bureau of Consumer Protection (BCP) - Part of FTC

⁃ “unfair or deceptive acts or practices in commerce.”

For further written and video explanation, discussion and practice questions, see What is the "Federal Trade Commission"?

Enforcement Procedures for the FTC
  • Advisory Opinions & Industry Guides
  • Investigation
  • Consent Orders
  • Administrative Complaint
  • Criminal Charges - Section 5 of the FTC Acts by:

⁃ committing “unfair or deceptive acts or practices”, or

⁃ violating “trade regulation rule”.

For further written and video explanation, discussion and practice questions, see What are the enforcement procedures of the FTC?

Penalties for Violating FTC Regulations
  • Rescission of contracts
  • Refund of money or return of property;
  • Payment of damages to consumers, and
  • Public notification of trade practice violations.
  • Fines may be assessed in three distinct situations:

⁃ For violation of a consent or cease and desist order,

⁃ For a violation of trade regulation rule, and

⁃ For a knowing violation of prior FTC orders against others.

For further written and video explanation, discussion and practice questions, see What penalties exist for violating FTC regulations?

Prohibited Commercial Practices
  • “Deceptive” practices

⁃ “reasonable consumer”

⁃ express and implied claims

⁃ consumers misimpression

⁃ “material”?

For further written and video explanation, discussion and practice questions, see What commercial practices does the FTC prohibit?

Consumer Financial Protection Act
  • Established the Consumer Financial Protection Bureau (CFPB).
  • Authority & Procedure - Conducts investigations into allegations of consumer fraud.
  • State Regulatory Authority - States may also regulate consumer protection,

For further written and video explanation, discussion and practice questions, see What is the "Consumer Financial Protection Act"?

Equal Credit Opportunity Act
  • Protects individuals from discrimination in lending or the extension of credit.
  • Covers financial institutions, retail establishments, credit-card issuers, and other credit-granting firm.
  • Examples of discrimination:

⁃ Refusing to extend credit,

⁃ Discouraging someone from pursuing credit based on a protected characteristics,

⁃ Charging a higher rate of interest,

⁃ Asking about marital status for a single-borrower loan,

⁃ Asking about children or plans to have children,

  • Business Compliance

⁃ Calculate income from all regular sources, such as alimony, maintenance, and part-time jobs;

⁃ Use the credit history for all partners;

⁃ Inform the candidate about the credit decision (granted or denied) within 30 days; and

⁃ Give a specific reason for denial of credit.

  • Remedies for Violation

⁃ Private causes of action or pursue enforcement through the FTC or CFPB.

⁃ May recover actual damages, punitive damages (up to $10,000), attorneys fees, legal costs and equitable remedies.

⁃ The FTC may also bring an administrative or civil action

For further written and video explanation, discussion and practice questions, see What is the "Equal Credit Opportunity Act"?

Fair Credit Reporting Act
  • Protects consumers from inaccurate personal credit reports.
  • Each stage of the credit reporting process

⁃ Collection of information,

⁃ Reporting of that information to credit agencies,

⁃ Dissemination of credit information,

⁃ Use of a consumer’s credit information (such as in extending new credit).

 

  • Requirements on Users of Credit Reports

Notice of Rejection

Investigative Consumer Reports

Employer Background Checks

For further written and video explanation, discussion and practice questions, see Users of Information?

Reporting Agencies - FCRA
  • Consumer Reporting Agencies

Procedures

Verify Information

Dispute Negative Information

Notification of Negative Information

Removal of Negative Information

For further written and video explanation, discussion and practice questions, see Reporting Agencies?

Furnishers of Information - FCRA
  • Furnishers of Credit Information

⁃ Complete and accurate information

⁃ Investigate consumer disputes

⁃ Correct, delete, or verify information within 30 days

⁃ Inform consumers about negative information within one month.

For further written and video explanation, discussion and practice questions, see Furnishers of Information?

Enforcement - FCRA
  • The FTC and CFBP enforce the provisions of the FCRA.

For further written and video explanation, discussion and practice questions, see Enforcement?

Truth in Lending Act (TILA)
  • Protects individuals from deceptive or confusing credit relationships.
  • Regulations known as “Regulation Z”.

⁃ Disclosure requirements for lending institutions

  • Applicability
  • Disclosures

Finance Charge

Annual Percentage Rate

Financing Statement - Before extending credit, the lender must provide a detailed financial statement to the borrower before extending credit.

  • Enforcement

For further written and video explanation, discussion and practice questions, see What is the "Truth in Lending Act"?

Fair Debt Collection Practices Act (FDCPA)
  • Puts limitations on the debt collection practices, method for disputing debts, remedies for violations.
  • Applies to debt collectors
  • Information from Debt Collector

Identification

Amount

Creditor Information

Notice of Dispute

Verification of Debt

  • Prohibited Conduct

Collection Hours

Workplace Restrictions

Abusive Collection Practices

Deceptive Practices

Publicly Communicating Debt

Collection Amount

Request to Cease Communication

Legal Representative

Verification of Debt

  • Enforcement of the FDCPA

⁃ CFPB may initiate investigations - civil or criminal actions

⁃ Consumers may also file a civil action

For further written and video explanation, discussion and practice questions, see What is the "Fair Debt Collection Practices Act"?

Fair Credit Billing Act (FCBA)
  • Reporting and disputing credit errors.
  • Within the consumer’s home state or 100 miles of home.
  • Covers banks and other Federal Deposit Insurance Corporation (FDIC) businesses.
  • Methods of Disputing a Debt

⁃ Send written notice within 60 days

⁃ Acknowledge within 30 days.

⁃ Creditor must investigate

⁃ Correct or explain why

  • Enforcement

⁃ Private action against the creditor.

⁃ Actual damages, statutory damages of twice the finance charges, court costs, and attorney’s fees.

For further written and video explanation, discussion and practice questions, see What is the "Fair Credit Billing Act"?

Electronic Funds Transfer Act (EFTA)
  • Regulate transfer of funds electronically.
  • Between two separate institutions.
  • Consumer Protections

⁃ Protects a consumer for lost, stolen, or misused debt cards.

⁃ Report the misuse of a debt care within 2 days of learning of the misuse.

⁃ 2 days = $500, 60 days = full liability

  • Responsibility of Financial Institution

⁃ Give notice of liability

⁃ Institution must investigate the error and resolve it within 45 days.

⁃ 10 days to complete investigation

For further written and video explanation, discussion and practice questions, see What is the "Electronic Funds Transfer Act"?

Consumer Product Safety Act (CPSA)
  • Protects consumers against unreasonably dangerous products.
  • Created Consumer Product Safety Commission (CPSC),
  • Authority over most consumer products,
  • Establish product safety standards, recall, ban products

For further written and video explanation, discussion and practice questions, see What is the "Consumer Product Safety Act"?

Product Labeling Laws
  • Combination of Federal and State Agencies.

The Federal Trade Commission (FTC)

Food and Drug Administration

Consumer Product Safety Commission

US Customs and Border Protection (CBP)

The Fair Packaging and Labeling Act

 

  • Fair Packing and Labeling Act (FPLA) - labeling of “consumer commodities”.

⁃ type of commodity enclosed

⁃ amount of contents,

⁃ the manufacturer or distributor’s name and location.

 

  • Other Notable Labeling Laws

Federal Hazardous Substance Act (FHSA)

Toxic Substance Control Act (TSCA)

Poison Prevention Packaging Act (PPPA)

Labeling of Hazardous Art Material Act (LHAMA)

Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA)

Flammable Fabrics Act (FFA)

Textile, Wool and Fur Acts

OSHA Hazard Communication Standard

For further written and video explanation, discussion and practice questions, see What "labeling laws" apply to consumer products?

Federal Food, Drug, Cosmetic Act
  • Ensure the safety of food, drugs (some medical devices), and cosmetics.
  • FDA to administer the provisions
  • Both civil and criminal penalties for violation of its provisions.
  • May be subject to criminal action.

For further written and video explanation, discussion and practice questions, see What is the "Federal Food, Drug, and Cosmetic Act"?

Magnuson-Moss Warranty Act
  • Protect consumers by regulating the use of warranty and disclaimer provisions by merchants.
  • Federal law administered by FTC
  • Warranties are presented in a manner understood by the consumer.
  • Requirements of the Act
  • Disclose, fully and conspicuously, in simple and readily understood language,
  • Important when a merchant provides a limited warranty

Repair or Replace

Limitations on Implied Warranties

Limitations on Damages

Branded Components

Exercise Warranty Rights

  • Remedies

⁃ Civil actions by the FTC or by private parties.

For further written and video explanation, discussion and practice questions, see What is the "Magnuson-Moss Warranty Act"?

Privacy Act of 1974
  • Limits ability of Federal Government to collect information on US citizens.
  • It also regulates the use, maintenance, and dissemination of collected personally-identifiable information.
  • Regulations in Code of Fair Information Practices.
  • Provide public notice of their records and systems via the Federal Register.
  • Requires consent prior to disclosure
  • Data Integrity Board that reports all complaints about Privacy Act violations to the Office of Management and Budget.

For further written and video explanation, discussion and practice questions, see What is the "Privacy Act of 1974" (Privacy Act)?

Right to Financial Privacy Act of 1978
  • Limits ability of Federal Government to seek financial records from banks
  • Applies only to the Federal Government.
  • Protects individuals and partnerships with 5 or fewer partners.
  • Access available:

⁃ the customer authorizes access;

⁃ there is an appropriate administrative subpoena or summons;

⁃ there is a qualified search warrant;

⁃ there is an appropriate judicial subpoena; or

⁃ There is an appropriate written request from an authorized government authority.

For further written and video explanation, discussion and practice questions, see What is the "Right to Financial Privacy Act of 1978" (RFPA)?

Electronic Communication Privacy Act
  • Protects against unlawful interception of electronic communications by the Federal Government or individuals.
  • No wire taps, computer transmissions, stored electronic communications, and tracing of telephone communications, etc.
  • Federal crime

For further written and video explanation, discussion and practice questions, see What is the "Electronic Communication Privacy Act of 1986" (ECPA)?

Children’s Online Privacy Protection Act
  • Rules for online collection of personal information of children under the age of 13 years.
  • Regulate commercial websites, online services, mobile apps, etc.,
  • Targeted toward or knowingly collect info on children under 13 years old

For further written and video explanation, discussion and practice questions, see What is the "Childrens Online Privacy Protection Act of 1986" (COPPA)?

State Laws on Consumer Protection
  • Generally known as Unfair and Deceptive Practices (UDAP) statutes.
  • UDAP statutes include: extension of credit, insurance, utilities, post-sales acts, and real estate.

For further written and video explanation, discussion and practice questions, see What role do states play in Consumer Protection?


Flashcards - Study Practice

Q1
__________ laws are state and federal laws that serve to protect individual consumers from deception or fraud in the marketplace.

A1

Q2
A consumer is someone who buys something for ________.

A2
personal, family, or household use.

Resource Video: https://thebusinessprofessor.com/consumer-protection-law/

Q3
Consumer Protection laws promote the accurate disclosure of information in order to _________.

A3
facilitate market competition, and deter fraudulent practices.

Resource Video: https://thebusinessprofessor.com/consumer-protection-law/

Q4
The major federal consumer protection laws include:

A4
Federal Trade Commission Act; Equal Credit Opportunity Act; Fair Credit Reporting Act; Truth in Lending Act; Fair Debt Collection Practices Act; Consumer Financial Protection Act; Fair Credit Billing Act; Electronic Funds Transfer Act; Consumer Product Safety Act; Manguson-Moss Warranty Act; Federal Food, Drug, and Cosmetic Act; Various Labeling Laws; Privacy Act of 1974; Electronic Communication Privacy Act; Children’s Online Privacy Protection Act

Resource Video: https://thebusinessprofessor.com/federal-trade-commission/

Q5
Who has the ability to enforce consumer protection laws?

A5
Individuals affected by a merchant’s conduct may bring a civil action against the merchant; The government may then pursue administrative, civil, or criminal actions against the merchant.

Resource Video: https://thebusinessprofessor.com/federal-trade-commission/

Q6
The ___________ is the primary federal agency with the mission of protecting consumers.

A6
Federal Trade Commission (FTC)

Resource Video: https://thebusinessprofessor.com/federal-trade-commission/

Q7
A special bureau called the __________ promotes the consumer protection mission of the FTC.

A7
Bureau of Consumer Protection (BCP)

Resource Video: https://thebusinessprofessor.com/federal-trade-commission/

Q8
The FTC enforces these Consumer Protection rules and laws through the following methods:

A8
Advisory Opinions & Industry Guides; Investigation; Consent Orders; Administrative Complaint; Civil Actions; Criminal Charges

Resource Video: https://thebusinessprofessor.com/ftc-regulatory-enforcement-procedures/

Q9
Criminal charges against a business generally allege violation of Section 5 of the FTC Acts by:

A9
committing “unfair or deceptive acts or practices”, or violating “trade regulation rule”.

Resource Video: https://thebusinessprofessor.com/ftc-regulatory-enforcement-procedures/

Q10
The FTC, through the negotiation of consent orders, has broad powers to fashion appropriate remedies to protect consumers in trade regulation cases, including:

A10
rescission of contracts (each party must return what has been obtained from the other); refund of money or return of property; payment of damages to consumers, and public notification of trade practice violations.

Resource Video: https://thebusinessprofessor.com/ftc-remedies-for-consumer-protection-violations/

Q11
In an administrative action by the FTC, the administrative court may issue civil fines, which may be assessed in three distinct situations:

A11
for violation of a consent or cease and desist order; for a violation of trade regulation rule, and for a knowing violation of prior FTC orders against others.

Resource Video: https://thebusinessprofessor.com/ftc-remedies-for-consumer-protection-violations/

Q12
The FTC prohibits commercial practices that are __________.

Q13
In determining what is “deceptive”, the FTC will look at various characteristics about the information disclosed to the public.

A13
Would a reasonable person understand it; any express/implied claims; Does it give misimpression?; Is a deceptive claim material?

Resource Video: https://thebusinessprofessor.com/commercial-practices-prohibited-by-ftc/

Q14
The Consumer Financial Protection Act was passed in 2010 as part of the Dodd-Frank Act with the purpose of establishing the ______________.

A14
Consumer Financial Protection Bureau (CFPB)

Resource Video: https://thebusinessprofessor.com/consumer-financial-protection-act/

Q15
The CFPB and FTC overlap in authority to administer consumer laws. The CFPB has broad authority to regulate federal financial consumer laws including _________.

A15
Consumer Financial Protection Bureau (CFPB)

Resource Video: https://thebusinessprofessor.com/consumer-financial-protection-act/

Q16
The CFPB is divided into the following four offices:

A16
Office of Fair Lending and Equal Opportunity; Office of Financial Education; Office of Service Member Affairs; Office of Financial Protection for Older Americans

Resource Video: https://thebusinessprofessor.com/consumer-financial-protection-act/

Q17
Certain entities are exempt from CFPB authority, including:

A17
insurance companies, Internet service providers, real estate agents, lawyers, car dealers, and persons regulated by the SEC.

Resource Video: https://thebusinessprofessor.com/consumer-financial-protection-act/

Q18
The CFPB has exclusive authority to enforce consumer protection laws against _________.

A18
non-depository institutions and insured depository institutions with $10 billion or more in assets.

Resource Video: https://thebusinessprofessor.com/consumer-financial-protection-act/

Q19
Title X of the Consumer Financial Protection Act allows the application of state law to national banks. Federal law does preempt a state’s ability to enforce consumer protection law against national banks and other federal financial institutions if:

A19
the application of the state law would have a discriminatory effect on the national bank or thrift; the state law prevents or significantly interferes with the exercise of the national bank or thrift’s powers; or the state consumer law is preempted by another federal law.

Resource Video: https://thebusinessprofessor.com/consumer-financial-protection-act/

Q20
The ____________ protects individuals from discrimination in lending money or the extension of credit by financial institutions, retail establishments, credit-card issuers, and other credit-granting firms.

A20
Equal Credit Opportunity Act (ECOA)

Resource Video: https://thebusinessprofessor.com/equal-credit-opportunity-act/

Q21
The ECOA prohibits a lender from discriminating in the extension of credit based upon __________.

A21
race, color, religion, national origin, sex, marital status, age, or receipt of public assistance.

Resource Video: https://thebusinessprofessor.com/equal-credit-opportunity-act/

Q22
The ECOA imposes special responsibilities on businesses extending credit, as follows:

A22
Issuers must calculate income from all regular sources, such as alimony, maintenance, and part-time jobs; issuers must use the credit history for all partners; issuers must inform the candidate about the credit decision (granted or denied) within 30 days; and consumers must be given a specific reason for denial of credit.

Resource Video: https://thebusinessprofessor.com/equal-credit-opportunity-act/

Q23
The ECOA provides several remedies and penalties for violation of the Act, as follows:

A23
Private Administrative or Civil Actions; FTC Administrative or Civil Action; a private cause of action may recover actual damages, punitive damages (up to $10,000), attorneys fees, and legal costs; the FTC may pursue equitable remedies; and injunctions.

Resource Video: https://thebusinessprofessor.com/equal-credit-opportunity-act/

Q24
____________ protects consumers (not businesses) by regulating the accuracy, fairness, and privacy of consumer information reported to or held by consumer reporting agencies.

A24
The Fair Credit Reporting Act

Resource Video: https://thebusinessprofessor.com/fair-credit-reporting-act/

Q25
The FCRA regulates each stage of the credit reporting process, including:

A25
collection of information, reporting of that information to credit agencies, dissemination of credit information, and use of a consumer’s credit information (such as in extending new credit).

Resource Video: https://thebusinessprofessor.com/fair-credit-reporting-act/

Q26
The Act applies to anyone who ___________.

A26
prepares or uses a credit report in connection with extending credit, selling insurance, or hiring or firing an employee.

Resource Video: https://thebusinessprofessor.com/fair-credit-reporting-act/

Q27
A __________ is a collection of a consumer’s credit history. It includes such information as: past payment history, current credit accountings, late payments, credit limits, any debt or bill collection activity, liens, judgments, bankruptcies, etc.

Q28
A _____________ of a credit report is anyone who employs a report in the decision of whether to extend any form of credit. Extending credit may include financing a sale, establishing a recurring account, hiring, or loaning money.

Q29
The FCRA places the following requirements on businesses that use credit reports to make decisions affecting the consumer:

A29
Request the report for a permissible reason; inform consumers who have been denied credit because of an adverse credit report.

Resource Video: https://thebusinessprofessor.com/fair-credit-reporting-act-users-of-information/

Q30
___________ are investigations carried out through personal interviews in the consumer’s community to uncover personal details, such as her character, lifestyle, community reputation, etc.

A30

Q31
A business seeking to acquire information from an “Investigative consumer reports” may only seek such a report after ____________.

A31

Q32
Employers using consumer reports to screen job applicants or perspective employees must follow specific procedures, including:

A32
obtaining written permission; explain how the credit report will be used; avoid any inappropriate or non-disclosed uses of the report; provide a copy of the credit report (if the employee is not hired); and allow the applicant to dispute any information contained in the report before making a final decision.

Resource Video: https://thebusinessprofessor.com/fair-credit-reporting-act-users-of-information/

Q33
A ___________ is any business that collects information about consumers for the purpose of disseminating that information in connection with credit applications, employment, or other evaluations of the individual’s credit.

Q34
The largest personal credit reporting agencies in the United States are:

A34

Q35
The FCRA requires that credit reporting agencies follow the following guidelines:

A35
procedures to ensure the accuracy of information in a consumer report; Provide a consumer with notice of the information collected and seek to verify any disputed information; Provide a manner for disputing negative information on a credit report; If negative information is removed from the reporting agency’s file, give a consumer 5 days notice before reinserting that information; Remove any negative information from the report within seven years of the date of the reported delinquency;

Resource Video: https://thebusinessprofessor.com/fair-credit-reporting-act-reporting-agencies/

Q36
The FCRA places the following obligations upon creditors who furnish a consumer’s credit information to a reporting agency.

A36

Q37
In a civil action under the FCRA, a creditor may recover _______.

A37
Actual damages, attorney’s fees, court costs, and punitive damages (if the conduct is intentional).

Q38
The _______ was passed with the purpose of protecting individuals from entering into deceptive or confusing credit relationships. It requires businesses that extend credit to consumers to make certain disclosures regarding the terms of the credit.

A38
Truth in Lending Act (TILA)

Resource Video: https://thebusinessprofessor.com/truth-in-lending-act/

Q39
The group of regulations implementing the provisions of TILA is known as __________.

A39

Q40
The ____________ has rule-making authority under Regulation Z. _________ has enforcement authority for TILA.

A40
CFPB, along with the Federal Reserve Board; The FTC

Resource Video: https://thebusinessprofessor.com/truth-in-lending-act/

Q41
TILA requires a uniform manner of disclosure of the ________ and ________ associated with a particular loan.

A41
borrowing costs and payment

Resource Video: https://thebusinessprofessor.com/truth-in-lending-act/

Q42
TILA applies to consumer transactions with the following characteristics:

A42
The lender is in the business of extending credit for loan of money, sale of property, or furnishing a service; the debtor is a person; a finance charge may be imposed; and the credit obtained is primarily for personal, family, household, or agricultural purposes; when the buyer pays in four installments of more.

Resource Video: https://thebusinessprofessor.com/truth-in-lending-act/

Q43
TILA requires the following specific disclosures:

A43
Finance Charge; Annual Percentage Rate; Financing Statement

Resource Video: https://thebusinessprofessor.com/truth-in-lending-act/

Q44
Civil remedies for violation of TILA include

A44
An amount twice the amount of finance charges, plus attorney’s fees. The borrower may generally rescind the transaction within 3 days of the transaction or upon receipt of notice of right to rescind.

Resource Video: https://thebusinessprofessor.com/truth-in-lending-act/

Q45
Creditors may avoid liability for an error if they notify and correct the error within _____ days of discovery.

Q46
__________ was passed to protect consumers from abusive practices by debt collectors.

A46
The Fair Debt Collection Practices Act (FDCPA)

Resource Video: https://thebusinessprofessor.com/fair-debt-collection-practices-act/

Q47
The Fair Debt Collection Practices Act (FDCPA) establishes the following debtor protections:

A47
limitations on debt collection practices, provides a method for disputing uncertain debts, and prescribes remedies for violation.

Resource Video: https://thebusinessprofessor.com/fair-debt-collection-practices-act/

Q48
The FDCPA applies only to consumer debts collected by debt collectors — business debts are not covered. True or False

Q49
A debt collector is defined as ____________.

A49
”any person who uses any instrumentality of interstate commerce or the mail in any business the principal purpose of which is the collection of any debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another."

Resource Video: https://thebusinessprofessor.com/fair-debt-collection-practices-act/

Q50
A debt collector must provide the debtor with the following information:

A50
Identification of the collector; amount of the debt; the name of the creditor to whom debt is owned; notice that the debtor has 30 days to dispute the validity of the debt.

Resource Video: https://thebusinessprofessor.com/fair-debt-collection-practices-act/

Q51
If a debtor disputes the validity of the debt, the collector must provide ___________.

A51
Information verifying that the debt is valid and, if requested, the name of the original creditor.

Resource Video: https://thebusinessprofessor.com/fair-debt-collection-practices-act/

Q52
The FDCPA places the following limits on debt collection practices:

A52
Only within the hours of 8:00 a.m. to 9:00 p.m. ; may not contact the debtor at her place of employment or contact the employer once made aware that it is unwelcome; employ abusive practices to collect the debt; using deceptive practices or misrepresentations in order to collect the debt; no disclosing and discussing the debt with those other than the debtor; may not publish the debt publicly or list the debtor on a debt collection list; may only seek to collect an amount representing by the original debt and in accordance with state law.

Resource Video: https://thebusinessprofessor.com/fair-debt-collection-practices-act/

Q53
If a collector receives this written notice requesting no further contact, she cannot contact the consumer except to notify the debtor that collection efforts are halted or that the debtor intends to pursue legal action. True or False

Q54
A plaintiff suing under the FCDPA may recover ___________.

A54

Q55
The _____________ was passed as an amendment to TILA with the purpose of protecting consumers against unfair billing practices.

A55
Fair Credit Billing Act (FCBA)

Resource Video: https://thebusinessprofessor.com/fair-credit-billing-act/

Q56
The FCBA is administered by FTC and applies within ___________ (geographical boundary).

A56
the consumer’s home state or 100 miles of home.

Resource Video: https://thebusinessprofessor.com/fair-credit-billing-act/

Q57
The primary protections of the FCBA limit liability on lost, stolen, or misused credit cards to _____.

Q58
To dispute a bill on an open-end account under the FCBA, the consumer must __________.

A58
send written notice to the creditor within 60 days of receipt of the account statement containing the error.

Resource Video: https://thebusinessprofessor.com/fair-credit-billing-act/

Q59
A creditor receives a notice of bill dispute under the FCBA, she must:

A59
acknowledge receipt of the dispute within 30 days; investigate the dispute; either correct the disputed debt or explain to the debtor why it believes the debt is valid.

Resource Video: https://thebusinessprofessor.com/fair-credit-billing-act/

Q60
Enforcement of the FCBA is done through administrative procedure. True or False

A60
False. Enforcement of the FCBA is through private action by the individual affected.

Resource Video: https://thebusinessprofessor.com/fair-credit-billing-act/

Q61
_____________ was passed with the purpose of regulating the practice of transferring funds electronically between two separate institutions.

A61
The Electronic Funds Transfer Act (EFTA)

Resource Video: https://thebusinessprofessor.com/electronic-funds-transfer-act/

Q62
The EFTA protects a consumer in the case of ___________.

A62
lost, stolen, or misused debit cards.

Resource Video: https://thebusinessprofessor.com/electronic-funds-transfer-act/

Q63
A consumer’s liability in the case of lost, stolen, or misused debit card is limited to _______, if the consumer reports the violation with 2 days of learning of the situation, _____ if reporting after 2 days, _____ if reporting after 60 days.

Q64
If a consumer’s card is lost or stolen, the financial institution must:

A64
provide her with notice of her potential liability; provide a method for reporting the lost or stolen card and resolving the issue; must investigate the error (within 20 days) and resolve it within 45 days (or 90 days in limited circumstances).

Resource Video: https://thebusinessprofessor.com/electronic-funds-transfer-act/

Q65
___________ was passed for the purpose of protecting consumers against dangerous products.

A65
The Consumer Product Safety Act (CPSA)

Resource Video: https://thebusinessprofessor.com/consumer-product-safety-act/

Q66
The CPSA encompasses several consumer protection acts, such as:

A66
the Poison Prevention Packaging Act (PPPA) and the Consumer Product Safety Improvement Act (CPSIA).

Resource Video: https://thebusinessprofessor.com/consumer-product-safety-act/

Q67
____________ is charged with administering the provisions of the CPSA along with its regulatory provisions.

A67
The Consumer Product Safety Commission (CPSC)

Resource Video: https://thebusinessprofessor.com/consumer-product-safety-act/

Q68
Federal agencies heavily involved in product labeling laws include __________.

A68
the CPSC, FTC, and FDA

Q69
Collectively, federal and state laws require manufacturers to place informative labels and warnings on various types of products based upon _________.

A69
product category, materials or substance, and applicable safety standards.

Q70
The ___________ (agency) places consumer goods into product categories and prescribes specific labeling requirements pursuant applicable statutes, regulations, or industry standards.

A70
The Federal Trade Commission (FTC)

Q71
__________ classifies goods falling under its regulatory authority into product groups, such as cosmetic and food labeling, and prescribes the content for labels that must be affixed on the inside and outside of product containers, wrappers, or packaging.

A71
the Food and Drug Administration

Q72
The ___________ enforces packaging, labeling and other consumer disclosure provisions under the Consumer Product Safety Act, Federal Hazardous Substance Act, and Poison Prevention Packaging Act.

A72
Consumer Product Safety Commission

Q73
___________ regulates and polices the flow of goods into and out of the United States. It is tasked with enforcing US labeling laws for imported goods.

A73
US Customs and Border Protection Service (CBP)

Q74
__________ is the primary labeling law in the United States that requires labeling of “consumer commodities”.

A74
The Fair Packing and Labeling Act (FPLA)

Q75
The provisions of The Fair Packing and Labeling Act (FPLA) are enforced by the ___________.

A75
Food and Drug Administration and Federal Trade Commission.

Q76
The primary provisions require that labels disclose the following information:

A76
type of commodity enclosed; amount of contents; and the manufacturer or distributor’s name and location.

Q77
___________ is a federal law administered by the CPSC that requires labeling of containers of hazardous products to provide notice of the potentially harmful effects of contact with the hazardous substance and the first aid steps to take in the event of exposure.

A77
Federal Hazardous Substance Act (FHSA)

Resource Video: https://thebusinessprofessor.com/product-labeling-laws/

Q78
_________, Administered by the EPA, was passed in 1976 with the purpose of assessing and regulating new and existing commercial chemicals entering the US Market.

A78
Toxic Substance Control Act (TSCA)

Resource Video: https://thebusinessprofessor.com/product-labeling-laws/

Q79
____________ requires manufacturers to employ child-resistant packaging for certain potentially poisonous items, including prescription and over-the-counter drugs, household chemicals (such as cleaners), and other hazardous materials (such as poisons).

A79
Poison Prevention Packaging Act (PPPA)

Resource Video: https://thebusinessprofessor.com/product-labeling-laws/

Q80
___________ is a federal act requiring that all art material sold to consumers undergo a toxicology review to identify any potential for adverse health effects and to ensure appropriate labeling of the hazards.

A80
Labeling of Hazardous Art Material Act (LHAMA)

Resource Video: https://thebusinessprofessor.com/product-labeling-laws/

Q81
___________ was designed to regulate the distribution or sale of any defoliant, desiccant, plant regulator, or nitrogen stabilizer, or pesticides, including any mixture of substances used to prevent, repel, destroy, or mitigate the presence of insects, fungi, and rodents.

A81
Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA)

Resource Video: https://thebusinessprofessor.com/product-labeling-laws/

Q82
_____________ Provided authority to the Consumer Product Safety Commission to issue mandatory flammability standards and to mandate placing warnings on tags or labels that indicate the product’s flammable nature.

A82
Flammable Fabrics Act (FFA)

Resource Video: https://thebusinessprofessor.com/product-labeling-laws/

Q83
The FTC to administer statutes and regulations aimed at regulating fabrics, furs, and textiles in the US, that require:

A83
Labeling the fiber content, country of origin, manufacturer (or marketer) identity.

Resource Video: https://thebusinessprofessor.com/product-labeling-laws/

Q84
___________ Require that manufacturers label chemical containers and develop material safety data sheets that provide detailed information about the material.

A84
OSHA Hazard Communication Standard

Resource Video: https://thebusinessprofessor.com/product-labeling-laws/

Q85
___________ was passed for the purpose of ensuring the safety of food, drugs (some medical devices), and cosmetics, including provisions for electronic radiation control, provisions for effective testing and marketing of drugs, and bioterrorism preparation.

A85
The Federal Food Drug and Cosmetic Act (FFDCA)

Resource Video: https://thebusinessprofessor.com/federal-food-drug-and-cosmetics-act/

Q86
___________ Is a Federal law passed to protect consumers by regulating the use of warranty and disclaimer provisions by merchants.

A86
The Magnuson-Moss Warranty Act (MMWA)

Resource Video: https://thebusinessprofessor.com/magnuson-moss-warranty-act/

Q87
The Magnuson-Moss Warranty Act (MMWA) seeks to ascertain that warranties are presented in a manner that is __________ by the consumer.

A87
“readily understood”

Resource Video: https://thebusinessprofessor.com/magnuson-moss-warranty-act/

Q88
Under the Magnuson-Moss Warranty Act (MMWA), merchants are not required to provide a warranty on products.

A88
True, however merchants must comply with the act if they provide warranties.

Resource Video: https://thebusinessprofessor.com/magnuson-moss-warranty-act/

Q89
The FTC requires that a merchant warranting a consumer product disclose, fully and conspicuously, in simple and readily understood language, ___________

A89
the terms and conditions of the warranty.

Resource Video: https://thebusinessprofessor.com/magnuson-moss-warranty-act/

Q90
When a merchant fully warrants a product against defect, the warrantor must comply with the following provisions:

A90
Repair or Replace; Limitations on Implied Warranties; Limitations on Damages; Branded Components; Exercise Warranty Rights

Resource Video: https://thebusinessprofessor.com/magnuson-moss-warranty-act/

Q91
As a remedy for violation of the act, the MMWA allows for civil actions by __________.

A91
The FTC or by private parties.

Resource Video: https://thebusinessprofessor.com/magnuson-moss-warranty-act/

Q92
___________ restricts the ability of the Federal Government to collect information about individual US citizens and regulates the use, maintenance, and dissemination of collected personally-identifiable information.

A92
The Privacy Act of 1974

Resource Video: https://thebusinessprofessor.com/privacy-act-of-1974/

Q93
The regulations pertaining to “Personally-identifiable information” are contained in what is known as the ___________.

A93
Code of Fair Information Practices.

Resource Video: https://thebusinessprofessor.com/privacy-act-of-1974/

Q94
All federal agencies, particularly those that collect personally-identifiable information, must provide public notice of their records and systems via the _________

A94
Federal Register, and provide a means by which individuals may seek access to and amend any erroneous material in their records.

Resource Video: https://thebusinessprofessor.com/privacy-act-of-1974/

Q95
Consent of an individual is required before the agency may disclose that person’s personal information. There are, however, several exceptions where a federal agency may disclose personally-identifiable information about an individual without notifying the person, including:

A95
For statistical purposes by the Census Bureau or the Bureau of Labor Statistics; For routine uses within a US government agency; For archival purposes "as a record which has sufficient historical or other value to warrant its continued preservation by the United States Government”; For law enforcement purposes; For congressional investigations; and Other administrative purposes.

Resource Video: https://thebusinessprofessor.com/privacy-act-of-1974/

Q96
___________ places limitations on the ability of the Federal Government to seek financial records about an individual from banks or other financial institutions.

A96
The Right to Financial Privacy Act of 1978

Resource Video: https://thebusinessprofessor.com/right-to-financial-privacy-act/

Q97
The RFPA applies only to the Federal Government. It does not govern requests for financial records made by private businesses or state or local governments. True or False

Q98
The Right to Financial Privacy Act of 1978 only protects the records of individuals and small partnership. It does not protect the financial information of other business entities. True or False

Q99
The following are exceptions to The Right to Financial Privacy Act of 1978, where the Federal Government may access such records:

A99
the customer authorizes access; there is an appropriate administrative subpoena or summons; there is a qualified search warrant; there is an appropriate judicial subpoena; or there is an appropriate written request from an authorized government authority.

Resource Video: https://thebusinessprofessor.com/right-to-financial-privacy-act/

Q100
If the Federal Government seeks to obtain these records, it must notify the individual whose records are requested. The customer then has the right to ________.

A100
Challenge the disclosure within 10 days from the date of written notice to challenge the disclosure.

Resource Video: https://thebusinessprofessor.com/right-to-financial-privacy-act/

Q101
____________ protects individuals against unlawful interception of electronic communications by the Federal Government or individuals by restricting the ability to undertake wire taps, computer transmissions, stored electronic communications, and tracing of telephone communications, etc.

A101
The Electronic Communication Privacy Act of 1986

Resource Video: https://thebusinessprofessor.com/electronic-communication-privacy-act/

Q102
___________ was passed to protect against the online collection of personal information of children under the age of 13 years.

A102
The Children’s Online Privacy Protection Act (COPPA)

Resource Video: https://thebusinessprofessor.com/childrens-online-privacy-protection-act/

Q103
The Children’s Online Privacy Protection Act (COPPA) regulates commercial websites, online services, mobile apps, etc., that __________.

A103
collect personal information from operators of the site and is targeted toward children under 13 years old or sites that collect information with knowledge that children under the age of 13 years are using the site.

Resource Video: https://thebusinessprofessor.com/childrens-online-privacy-protection-act/

Q104
Operators of such sites must comply with the following provisions:

A104
Inform users of their practices of recording user information; Provide notice to parents of the intent to collect children’s information and obtain parental consent; Prohibit the disclosure of information collected about children, except in limited circumstances; Allow parents to review (and request deletion) of the collected information; Allow parents to prevent further use or future collection of the child’s information; Maintain security in the storage of information; and Not maintain the information longer than necessary, and delete the information after it has served its intended purpose.

Resource Video: https://thebusinessprofessor.com/childrens-online-privacy-protection-act/

Q105
State laws protecting consumers are generally known as ____________.

A105
Unfair and Deceptive Practices (UDAP) statutes.

Resource Video: https://thebusinessprofessor.com/state-consumer-protection-laws/

Q106
Common areas regulated by UDAP statutes include: ____________.

A106
extension of credit, insurance, utilities, post-sales acts, and real estate.

Resource Video: https://thebusinessprofessor.com/state-consumer-protection-laws/


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