Calling on the agency to take action, U.S. Senator Bill Nelson (D-Fla.) requested that the Federal Trade Commission investigate Volkswagen’s advertising claims for its “clean diesel” vehicles.
In September, the Environmental Protection Agency and California’s Air Resources Board issued press releases which revealed that approximately 482,000 Volkswagen and Audi diesel cars contained software that was intentionally designed to cheat on emissions tests to circumvent environmental standards for air pollutants. The software could detect when a test was under way and reduce emissions, but return to normal operation in daily use (in some cases, with up to 40 times the standard emissions).
Within days, Volkswagen’s CEO resigned, the EPA and Department of Justice announced civil and criminal investigations, a securities class action was filed in Virginia federal court, multiple state Attorneys General announced their own investigations, and dozens of class actions were filed by owners of the affected cars.
Sen. Nelson acknowledged the efforts of the EPA and the DOJ, but told Chairwoman Edith Ramirez that the FTC “also has an appropriate role in investigating the company’s actions,” to enforce Section 5 of the Federal Trade Commission Act’s prohibition against unfair or deceptive acts or practices.
“Volkswagen advertised their diesel cars as ‘clean diesel’ and as otherwise environmentally friendly,” Sen. Nelson wrote. “Yet, contrary to these express claims, Volkswagen’s and Audi’s diesel vehicles, by design, were neither clean nor environmentally friendly, and they failed to comply with federal environmental laws.”
The FTC is “uniquely positioned” to represent the interests of consumers, the lawmaker added, and the agency should make use of its powers under Section 5 to explore possible remedies such as consumer redress as well as “a full panoply of equitable remedies,” including forcing VW “to launch a comprehensive corrective marketing campaign that would cure the deception and inform consumers about their remedial options.”
Declaring himself “outraged” that Volkswagen would “cheat its customers by deceiving them into buying a car that wasn’t what was advertised,” Sen. Nelson urged the Commission “to exercise all of its authority on behalf of the American public.”
To read Sen. Nelson’s letter to the FTC, click here.
Why it matters: “Volkswagen’s transgressions demonstrate the importance of having multiple ‘cops on the beat’ when it comes to consumer protection,” Sen. Nelson wrote. “The EPA and the DOJ have very important law enforcement and remedial roles to play when faced with the kinds of behavior at issue here. In establishing the FTC Act, however, Congress did not contemplate a bystander role for the agency in the face of galling and unmitigated consumer deception. As an independent agency of Congress, the FTC has a key role to play—in cooperation with the EPA and DOJ—as one of the cops on the beat to make sure consumers are protected.”