How Industry Lobbyists Help Kill Strong FTC role on privacy and consumer protection

Language strengthening the Federal Trade Commission has been removed from a newly-merged financial regulatory reform bill (link is external). The FTC provisions in the federal legislation were opposed by numerous advertising and business groups, among them the Interactive Advertising Bureau, Direct Marketing Association, Association of National Advertisers, and U.S. Chamber of Commerce.

The DMA and ANA released statements praising removal of the FTC enforcement provision and suggesting their lobbying efforts helped bring about the change. The legislation was sponsored by Senate Banking Chairman Christopher Dodd of Connecticut and House Financial Services Chairman Barney Frank of Massachusetts, both Democrats.

“DMA led the charge in the fight to keep these FTC expansion provisions out of the Restoring American Financial Stability Act…as the final text of the bill was negotiated by a formal Conference Committee,” the organization said in a June 25 statement. The DMA went on to stress that it “will remain vigilant until the bill has been signed by the President.”

During the conference period, Democratic Congressmen Henry Waxman and Bobby Rush were “very forthcoming that their number one priority was going to be to reinsert the [FTC] provision,” according to Chris Merida, director of congressional and public affairs for the U.S. Chamber of Commerce. House and Senate conferees who negotiated the merged bill worked from the Senate’s version, which did not include the FTC language. The House version did. Merida said the push to include the provision prompted PR campaigns on both sides of fight.

Mike Zaneis, the IAB’s VP of public policy, said this was the “number one legislative priority” for the trade group. Despite the fact that online privacy legislation has made more headlines, Zaneis described the inclusion of the FTC provision in the financial regulatory reform bill as the “one legislative vehicle that was moving and had at least a likelihood of passing.” If the FTC is given the broader authority, it could “just move unilaterally,” making the threat of overreaching privacy legislation moot.

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