False advertising is any type of promotion that deceives consumers. Even advertising that only has the potential to be misunderstood by consumers may be considered deceptive. In most cases, false advertising leads the consumer to believe that he is somehow profiting from a purchase. He may think he is getting a good deal, saving money, or buying something that will perform in a specific manner, but actually, the advantage is all on the side of the advertiser. Any potential benefit to the consumer is usually non-existent.
Due to many instances of false advertising, the US Federal Trade Commission (FTC) has regulatory power to step in and end any potentially misleading or deceptive claims. The FTC investigates incidences where claims are made that could lead to a purchase because of misunderstanding of the product or service. This does not apply to claims made by politicians, though many argue it should.
In order to report false advertising in the US, people must have a copy of the original ad to send to the FTC or to their state's consumer protection office. The ad must prove a potential to deceive. This usually doesn’t mean that a person will be able to sue the company, though they may be able to stop certain types of claims being made or get their money back for a product or service they purchased. Usually, the FTC steps in to require the advertiser to add more information to any ads or on product labels, or asks the advertiser to stop an ad campaign. The agency cannot issue warrants for arrest or impose fines unless the advertiser does not comply with its requests.
There are many types of false advertising that consumers see on a regular basis. A common form is called inflated price comparison. In this form, retailers raise the price of items, and then offer them for a lower “sale” price, which indicates to most consumers that they are getting a “deal” on merchandise since it is supposedly on sale. Inflated price comparison might be used when customers have loyalty cards to grocery stores or retail stores of a certain size. Cardholders are able to purchase products at presumed discounted prices. While some loyalty cards can save a little money, they don’t when other product prices are inflated.
Another common type is a product sold with a rebate. The rebate is not given at point of purchase, but instead must be claimed by the purchaser and, unfortunately, some companies are notorious for not giving rebates back in a timely manner. When the advertisement doesn’t claim that the price is “after rebate,” shoppers can expect to pay the full price.
Services that offer introductory prices may be potentially deceptive when ads don’t explicitly state that the price will increase after the introductory period has expired. Other forms include making false claims about products, such as "Georgia" peaches grown in California. Using fillers in packaging is also false advertising because it can increase weight, making the consumer feel like he is getting more of the actual product than is really in a package.
Many companies now attempt to avoid accusations of deceptive advertising by stating conditions of offers. Unfortunately, these may be printed in small print, far from the advertised price. A wary consumer should always look at the conditions and exclusions prior to making a purchase.
