Alliance Seeks End to Bogus Made in America Labels
Manufacturers of U.S.-made products, hoping to capitalize on President Trump’s aggressive stance on China, are calling for tougher action against companies that make bogus “Made in the USA” claims.
The Alliance for American Manufacturing wants the Federal Trade Commission to get companies to pay restitution, or at least admit fault, the first time they falsely label products as American-made. The FTC’s policy has been to seek money only after a second violation.
“You have the president talking about ‘Made in America’ and manufacturing on a regular basis,” AAM President Scott Paul said. “It seemed like the right time to encourage the FTC to be more earnest about its enforcement.”
In three major recent cases, the FTC ruled against three companies—a maker of military-themed backpacks, a hockey puck manufacturer and an online mattress retailer—that falsely represented products as made in America. All three companies were ordered to stop marketing these products as made in the U.S., but none was fined or forced to admit fault.
Fraudulently labeled products have long been an irritant for U.S. manufacturers, who see a “Made in America” label as a competitive advantage and a source of pride. Many of the falsely labeled products are made in China, and American manufacturers see a chance to leverage Trump’s passion on the issue.
Under FTC policy, products must be made with nearly all American-made parts to be labeled as “Made in America,” or to use American flags on their packaging, but enforcement options are limited.
The FTC can pursue refunds for customers for first-time offenses, but it is prevented by law from seeking outright fines for a first violation, said James Kohm, director of the agency’s enforcement division in the Bureau of Consumer Protection. Source: Wall Street Journal