House and Senate members approved a compromise version of financial reform legislation that does not significantly expand the Federal Trade Commission’s powers on June 25. The Direct Marketing Association and a coalition of more than 40 other industry groups had lobbied against any FTC power expansion as part of the Restoring American Financial Stability Act.
Lawmakers accepted the Senate bill’s language on the FTC, which did not give the agency broad new rulemaking and enforcement authority. The House version of the bill would have broadened the FTC’s rulemaking and enforcement authority.
“This would’ve dramatically changed how the FTC operates,” said Linda Woolley, EVP for government affairs at the DMA. “It would have basically given the FTC jurisdiction over the whole US economy.”
The combined version of the bill must be approved by both congressional bodies separately and signed by President Barack Obama before it takes effect.
The FTC seemed to reference the House support for expansion of powers in its statement regarding the latest decision.
“Although we didn’t get more effective rulemaking and other tools we sought, we are gratified that there is such strong and growing support in both chambers for the FTC and removing the laborious procedural hurdles we face,” said Cecelia Prewett, spokeswoman for the FTC, in an e-mailed statement.
The industry groups previously wrote a letter to Senate Majority Leader Harry Reid (D-NV) and Minority Leader Mitch McConnell (R-KY) opposing any significant expansion of the FTC’s rulemaking and enforcement authority in financial reform. The trade associations emphasized that FTC power expansion should be debated separately from financial reform.