DECEPTIVE BUSINESS PRACTICES  

My Depression-era father instilled a lot of frugality and skepticism in my siblings and me. Skepticism is a healthy process of critical thinking that involves questioning and seeking evidence before accepting something as true.

Although I certainly look for bargains on shopping and convenience goods, I’m skeptical of most “great deals” that are being promoted. If I can be faulted for numerous deficiencies, being proven gullible for deceptive marketing practices has very seldom been the case.

Perhaps like me, though, you’re finding it more difficult to evaluate many claims about consumer products and services. Part of my difficulties here might be aging and less familiarity than younger folks with certain recent media twists and turns. We all know that children and senior citizens have long been special targets for marketing shysters and frauds. Many seniors, though, are not easy victims. Some have the need and more available time than other consumers to do careful shopping and purchasing.

Still, I find that my wife and I are spending an increasing amount of time and hassles trying to resolve what seem to be less than honest consumer marketing practices and unfair financial charges to our credit cards. It can be more than frustrating to spend hours trying to resolve apparent billing mistakes or to have to cancel and reorder credit cards because a business continues to charge us each month. I’ll admit that my wife handles most of these problems, largely because she tends to be more responsive, diplomatic, and patient over the phone.

One role of government is trying to protect consumers from deceptive and fraudulent business practices. The key federal agency for this is the Federal Trade Commission. Established in 1914, the FTC is an independent federal agency that has the authority to investigate and prosecute unfair methods of business competition. Initially, the FTC focused primarily on antitrust issues, but it gradually expanded its attention to deceptive marketing and advertising practices. The commission's authority was strengthened by the Wheeler-Lea Act of 1938, which explicitly gave the FTC power to prosecute unfair or deceptive practices harming customers, even when they didn't necessarily harm business competition.

Some questionable business practices have been around for ages, like simple “bait-and-switch” marketing activities. A new FTC rule this year, though, targets hidden and deceptive fees, particularly in the live-event ticketing and short-term lodging industries. This rule requires businesses to disclose the true and total price, including all mandatory fees, upfront.

As AI has become more integral for business operations, the FTC is scrutinizing claims about AI capabilities and effectiveness.  “AI washing” is a deceptive trade practice in which businesses overstate or misrepresent their usage of artificial intelligence to look more sophisticated or capable.

In August 2025, the FTC sued Air AI Technologies for allegedly making deceptive claims. The company was accused of falsely promising consumers that they could achieve significant benefit using its proprietary, AI-powered system for online sales. Also in August, the FTC issued a final order against Workado, LLC. The company was prohibited from making unsubstantiated claims about the accuracy of its AI content-detection product. 

Another recent concern has been AI-generated online reviews or testimonials. An FTC rule against this occurred in 2024 and was to become fully enforceable this year. With the trend toward more people establishing themselves as “social influencers,” there have also been several influencer class-action lawsuits filed this year. These lawsuits claim influencers failed to make proper disclosures and that consumers made purchases or overpaid due to this.

Stephen C. Piepgrass, Daniel Waltz, and Nick Gouverneur on the Regulatory Oversight website describe another emerging deceptive business practice known as “software tethering.” This occurs when “manufacturers use software to control and limit how a device functions after a consumer has purchased it.” Attractive features associated with a online subscription are locked and rendered nonfunctional by software sometime after the purchase of a device. Increasingly, consumers are complaining that their connected products are losing software support or advertised features that may have prompted their original purchase.

The priorities of the FTC under the second Trump administration seem to be varying somewhat from those of the prior administration. Its role related to core consumer protection issues remains largely the same, but it has focused more on identifying and reducing competitive barriers. The size of its workforce has declined slightly, but less so yet than reductions in many government agencies. FTC Chairman Andrew N. Ferguson issued a statement proclaiming July 2025 as "Made in the USA" Month, and false claims related to USA origin of products are being more actively pursued.  

Concerns have been raised by administration critics concerning the independent status of federal agencies such as the FTC. The Supreme Court in 1935 established strong legal protections for the FTC's independence and has had 90 years of legal precedent behind that ruling. Legal challenges to that independence this year have had conflicting rulings. The Supreme Court overruled the verdict of the illegality of early Trump Administration’s FTC firings by a lower court in July 2025, and it cleared the way for these personnel removals in September. Regardless of the degree of FTC independence, the public will continue to suffer from old and new deceptive business practices and will expect the government to respond and protect consumers.