How do consumer protection laws keep you and your money safe?

Why were consumer protection laws created?

Different consumer protection laws have been put into place at various times throughout history. However, commercial litigation attorney Christian B.W. Stephens of Eckert Seamans says modern consumer protection laws were enacted in the early 20th century and "continued to rise in popularity throughout the century in individual states."

Stephens said these laws generally stemmed from "a desire to improve an individual consumer’s bargaining power and the remedies available to individual consumers and businesses for unscrupulous commercial practices."

Both federal and state government agencies in the U.S. enact and enforce their own consumer protection laws. While the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB) oversee most consumer protection laws at the federal level, individual state attorney generals and consumer protection agencies enforce their laws at the state level.

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What do consumer protection laws protect against?

All consumer protection laws are unique, protecting consumers against fraudulent practices, privacy violations, harassment and more.

"These laws are instrumental in ensuring equity, transparency and accountability within the marketplace while shielding consumers from fraudulent activities, deceptive practices, substandard products and inequitable business practices," explained attorney and consumer advocate Jessica Anvar Stotz.

Consumer warranties and service contracts

Consumer protection laws can help oversee and govern product warranties that aim to repair or replace items that have defects or stop working during the warranty period. These laws can oversee manufacturers' warranties, extended warranties and service contracts.

Consumer privacy

Consumer privacy laws protect individuals from harassment and having their sensitive personal information shared without their consent. Some consumer protection laws also protect individuals from being contacted in certain situations, including at work or home after certain hours.

Unfair trade practices

Some laws protect consumers from unfair trade practices that can result in financial losses. These laws protect people from businesses that would otherwise use deceptive or fraudulent practices to market their products and services.

Borrowing practices

There are laws that make it illegal for lenders to discriminate against consumers based on their age, gender, race, religion, marital status and more. These laws also prohibit lenders from performing certain practices like offering less favorable credit terms and closing accounts based on these factors.

Consumer credit

Some laws protect consumers' credit information, including preventing the release of information without proper consent. These laws also require lenders, insurance companies and other businesses to notify consumers when information in their credit reports results in adverse actions.

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List of consumer protection laws

There are many consumer protection laws in place today, and the most significant ones to know about are at the federal level.

Here's a rundown of the most important consumer protection laws keeping you safe from unfair and deceptive practices, harassment and more.

Which government bodies make consumer protection laws?

Consumer protection laws are put into action at both the federal and state level. The following entities oversee them:

• CFPB: The CFPB is a federal agency that protects individual consumers against unfair, deceptive or abusive practices while penalizing companies that violate the rules and break the law.
• FTC: The FTC also protects consumers against unfair and deceptive practices while protecting the public from unfair marketplace conditions.
• Food and Drug Administration (FDA): The FDA oversees various industries, including food production and pharmaceuticals, to protect consumers against harmful products.
• Individual states: Stotz points out that, at the state level, each state maintains its own consumer protection agency or division entrusted with enforcing state-specific consumer protection laws. "State attorney generals and local consumer protection offices also contribute to the enforcement of these statutes," she said.

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Bottom line

Consumer protection laws come in many different forms, each overseeing various aspects of consumer safety. Consumers can rely on these laws to protect them if they find themselves in the crosshairs of an abusive company or if they’re worried about privacy rights violations.