Key Terms
Consumer law
The area of law covering consumer transactions — obtaining credit, goods, real property, or services for personal, famil
Consumer protection laws
Laws designed to protect consumers against unfair trade and credit practices involving consumer goods; also protect agai
Debtor
Someone who owes an obligation — especially money — to another individual or business. A consumer becomes a debtor when
General principle
Advertising must be honest. Applies to ALL sales materials regardless of medium — print, electronic, social media, radio
Definition
A material misrepresentation or omission likely to mislead a potential customer that would also mislead a reasonable cus
Definition in consumer protection context
Products deemed dangerous to the consuming public. Includes drugs safe only in supervised small doses and toxic chemical
Passed
1975. Purpose: protect consumers from discrimination in credit applications.
Fair Credit Reporting Act (FCRA) Passed
1970. Purpose: regulate the gathering, storage, and reporting of credit-related information.
Applies to
Electronic direct deposits and withdrawals, ATMs, and point- of-sale transactions with merchants.
Credit bureau
An organization that maintains and distributes credit worthiness information to potential creditors, insurance companies
Consumer Rights Under FCRA
1. One free credit report per year from each of the three bureaus.
Credit freeze
Restricts or prohibits creditors from requesting the consumer's credit report without the consumer's permission. Consume
Electronic Fund Transfer Act (EFTA) Passed
1978. Purpose: protect consumers from unauthorized electronic fund transfers.
Preauthorized transfer
An electronic fund transfer authorized in advance to recur at regular intervals (e.g., automatic monthly mortgage paymen
FTC estimate
At least ten million consumers are victims of identity theft each year.