President Barack Obama signed the U.S. SAFE WEB Act into law earlier this month, reauthorizing the Federal Trade Commission to take action against international defendants that engage in false and deceptive behavior online.

Originally passed in 2006, the Undertaking Spam, Spyware, and Fraud Enforcement with Enforcers beyond Borders Act was set to expire in 2013. The law will now remain in effect until September 2020.

Under the Act the FTC may share information and work collaboratively with foreign law enforcement authorities to combat online fraud and spam attacks. Specifically, the agency’s powers extend to:

  • Reciprocate information sharing and investigative cooperation. The Act allows the FTC to share its confidential information with foreign law enforcement and, in return, receive information from foreign agencies. In addition, the FTC can conduct investigations and discovery to assist foreign authorities and receive foreign investigative assistance in matters before the FTC.
  • Authority in cross-border cases. The SAFE WEB Act confirms the FTC’s authority to redress harm in the United States caused by foreign wrongdoers and harm abroad caused by U.S. wrongdoers. Under the law, all remedies available to the FTC are applicable in cross-border cases, including the award of restitution to foreign victims.
  • Make criminal referrals. Actions that violate the FTC Act may be referred for criminal prosecution overseas, an option that helps the agency when it is working with a country that criminalizes fraud and deception instead of categorizing it as a violation of civil law.

Testifying in support of the law’s extension at a hearing before the House Energy and Commerce Subcommittee earlier this year, FTC Deputy Director for International Consumer Protection Hugh Stevenson called the Act “critical.”

He told lawmakers that since the law’s enactment, the agency has investigated over 100 online global frauds and filed more than 50 actions involving cross-border components, all of which saved consumers from losing hundreds of millions of dollars. Stevenson also testified that more than 100,000 online fraud consumer complaints were filed with the FTC in 2001 and at least 10 percent of those were related to foreign businesses.

To read H.R. 6131, the U.S. SAFE WEB Act, click here.

Why it matters: Rep. Mary Bono Mack (R-Calif.), one of the sponsors of the measure, called the extension of the legislation a “win-win.” “It’s good for American consumers. It’s good for the future of e-commerce. And it’s the right thing to do for our nation and our friends around the world,” she said in a statement. “With nearly 1.5 billion credit cards in use in the United States, nearly everyone in America has a stake in making certain that the FTC has the powers it needs to fight online fraud.” The Interactive Advertising Bureau also supported the Act’s extension, which Senior Vice President and General Counsel Michael Zaneis said has been “an effective tool” in protecting online commerce.