Consumer protection laws serve to protect individuals from fraudulent corporations or business practices. These laws may also support consumers in rebuilding credit or in recovering from bankruptcy. Some countries, such as Germany, the United Kingdom and Australia, have agencies that operate to protect consumers. The United States has several acts that have been passed by Congress to regulate fraudulent business practices and protect consumers.
In Germany, consumers are protected by the Federal Administrative Court. Cases claiming unfair business practices are typically heard in this court. Consumer protection in Germany is overseen by an appointed political officer of consumer protection. The Chancellor of Germany is usually responsible for appointing these Federal Ministers.
In the United Kingdom, consumers are protected by the Office of Fair Trading. The Consumer Protection act was passed by the Parliament in 1987 to delineate product liability, protect consumer safety and clarify pricing indications. Complaints may be brought before the Magistrates court or the Secretary of State.
In Australia, consumer complaints are addressed by Australian Competition and Consumer Commission (ACCC). The ACCC enforces the 1974 Trade Practices Act and serves to protect consumers from fraudulent practices. Warranties of the Trade Practices Act are specifically aimed at regulating product safety and identifying unfair trade practices.
In the United States, consumer protection laws are enforced and set in place by the Federal Trade Commission (FTC) to protect consumers from misleading or unfair trade practices. Most states also have additional consumer protection laws that protect consumers from business-specific fraud, such as vehicle and home sales or club contracts. These state laws vary greatly between regions and are often enforced by the state attorney general. Some well-known examples of federal consumer protection laws enforced by the FTC are the Consumer Credit Protection Act and the Magnuson-Moss Warranty Act.
The Consumer Credit Protection Act was set in place to protect those who are borrowing money. This act requires lenders to disclose all terms and conditions of the financing agreement before completing the transaction. These laws also limit the garnishment of wages and regulate the use of charge accounts.
The Consumer Credit Protection Act also requires businesses to participate in fair credit reporting practices. Fair credit reporting requires that the consumer be fully informed of any accruing debt and debt collection attempts before acquiring higher interest rates or being reported to a collection agency. The Consumer Credit Protection Act is typically enforced by the FTC, but most states have laws that are similar to the act to prevent state-isolated incidents of fraud.
The Magnuson-Moss Warranty Act was passed by Congress in 1975. This Act protects the consumer by mandating that a product's warranty completely disclose any terms and conditions of the warranty. These laws aim to protect consumers by improving available product information and preventing deceptive warranty practices by businesses.
The federal cause of action is a title that allows consumers to file complaints if they experience problems with a company defaulting on a written warranty. If a company fails to provide what was originally stipulated in the full or limited warranty, the buyer has the right under this act to seek legal action. If the seller is found to have defaulted on a warranty, then the seller is required to replace the cost of the product and pay any associated legal fees incurred by the buyer.
It is generally advisable to seek legal counsel under consumer protection laws. An attorney can address specific concerns of fraud and should be well informed of federal and state protection laws. An attorney may also file a complaint with the FTC to provide additional action against a fraudulent business.