FTC Focuses on Fine Print in 'Operation Full Disclosure'

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By Daniel Taylor, Esq. on September 26, 2014 1:02 PM

The Federal Trade Commission is ramping up efforts to enforce its fine-print disclosure guidelines for television and print advertising.

As part of an aptly titled new initiative dubbed Operation Full Disclosure, the FTC sent warning letters to more than 60 companies that failed to make proper disclosures in their advertising.

What prompted the letters and what are the FTC's rules on fine print in advertising?

Disclosures Too 'Easy to Miss'

According to the FTC's press release, the warning letters -- including letters to 20 of the 100 largest advertisers in the United States -- were prompted by ads in which the disclosures required by the FTC's advertising rules were in fine print or were "otherwise easy to miss, or hard to read."

These disclosures included a wide range of subject matter, including conditions for obtaining an advertised price, automatic billing, or the need for additional products in order to receive an advertised capability or accessory.

Other ads that got the FTC's attention were those that included demonstrations that were altered without adequate disclosure, or false claims that were contradicted by disclosures.

FTC Disclosure Rules

Generally, the FTC requires that when disclosures are necessary to prevent an ad from being deceptive, the information in the disclosure should be presented clearly and conspicuously.

For print ads, this means the disclosure should appear in a font that is easy to read and should not be buried in unrelated text or in a shade that blends into the background. For television ads, the disclosures should be on screen long enough to be read and understood.

In its letters to advertisers, the FTC warned that in addition to standing out, disclosures must meet the "clear and conspicuous" standard by using unambiguous language. The letters advised the companies contacted to notify the FTC about the corrective actions the companies plan to take. In addition, the FTC notes that the companies contacted were a "representative sample" of advertisers and that "advertisers who did not receive a letter should not assume that their advertisements are fine."

Seems like a pretty clear and conspicuous warning to businesses and advertisers: Double-check just how "fine" your fine print disclosures really are or face the potential consequences.

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