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FTC Announces Significant Hike to Civil Penalty Maximums

July 5, 2016

WASHINGTON, D.C. — Violations of the Federal Trade Commission’s prohibition on unfair or deceptive acts or practices are going to get more expensive come Aug. 1. That’s when the commission’s interim final rule aimed at increasing a variety of civil penalties takes effect.

According to its website, the FTC has approved final amendments to Commission Rule 1.98 that adjust the maximum civil penalty dollar amounts for violations of 16 provisions the regulator enforces, as required by the Federal Civil Penalties Inflation Adjustment Act Improvement act of 2015. The act directs agencies to implement a “catch-up” inflation adjustment based on a prescribed formula.

The maximum civil penalty amount will increase from $16,000 to $40,000 for the following violations and others listed in the Federal Register Notice:

  • Section 5(l) of the FTC Act: Final commission orders issued under section 5(b) of the FTC Act
  • Section 5(m)(1)(A) of the FTC Act: Trade regulation rules issued by the commission under section 18 of the FTC Act that address unfair or deceptive acts or practices, and other laws enforced by the commission that provide for civil penalties by reference to section 18
  • Section 7A(g)(1) of the Clayton Act: Premerger filing notification requirements under the Hart-Scott-Rodino Improvements Act

The Commission vote to publish the Federal Register Notice amending Commission Rule 1.98 was 3-0.

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