by Lesley Fair

Lesley Fair (photo courtesy of the author)

To turn the old adage on its head, imitation is the insincerest form of falsity. After years of fighting back against scammers who impersonate government agencies and companies, the FTC proposed a Trade Regulation Rule on Impersonation of Government and Businesses. The Rule would allow the FTC to recover consumer redress from impersonators or to seek civil penalties against those who violate the Rule. After a painstaking process of considering public comments about the proposal, the FTC just published a Final Rule  – and we think it’s an important step in the fight against this form of fraud.

In considering the proposed Rule, we heard from consumers who have been substantially injured by impersonators and heard from the government agencies and businesses whose names have been misused to perpetrate the fraud. We also considered statements at an informal public hearing on the proposal. You’ll want to read the Final Rule for the specifics, but here are some highlights:

• The new Rule specifies that it’s a rule violation – and an unfair or deceptive act or practice under the FTC Act – to “materially and falsely pose as, directly or by implication, a government entity or officer thereof” or to misrepresent “affiliation with, including endorsement or sponsorship by” a government entity or officer.
• The new Rule similarly specifies that it’s a rule violation – and an unfair or deceptive act or practice – to “materially and falsely pose as, directly or by implication, a business or officer thereof” or to misrepresent “affiliation with, including endorsement or sponsorship by ”a business or an officer of that business.

The Rule outlaws some of fraudsters’ favorite means of impersonation – for example, deceptively using government seals or the logos of businesses; spoofing government or business email or web addresses, including the bogus use of “.gov” email addresses or adopting lookalike email addresses or URLs that rely on misspellings of a company’s name; and falsely claiming a connection with a government agency or business (like telling a consumer “I’m calling from the Clerk’s Office” to falsely imply an affiliation with a court).

Just to be clear, government and business impersonation of this sort has always violated the FTC Act, but now that there’s a Rule in place, the FTC can seek consumer redress and civil penalties, powerful tools that hit scammers where it hurts: in the wallet. The Rule will take effect 30 days after it runs in the Federal Register.

That’s not the only update on the impersonator front. The FTC also has announced a Supplemental Notice of Proposed Rulemaking related to Proposed Amendments to Rule on Impersonation of Government and Businesses. We look forward to your feedback on a series of questions – for example, should the FTC add language to the Rule that would prohibit impersonating individuals? And should the Rule include language to make it illegal to knowingly provide scammers the means to harm consumers through impersonation? Once the Supplemental Notice appears in the Federal Register, you’ll have 60 days to file a public comment. 

Lesley Fair is a Senior Attorney at the Federal Trade Commission and a Lecturer at the law schools of George Washington University and Catholic University of America. This post first appeared on the Federal Trade Commission’s Business Blog.  

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