As many companies are relocating their production back to the U.S., American made products are becoming more desirable than ever. So desirable, in fact, that the Federal Trade Commission recently caught some companies lying about the origin of their products.
One of the companies, Patriot Puck claimed to sell “The only American Made hockey puck” and used terms on social media like “#AmericanMade” and “100% Made in the USA”. The entire company’s marketing seemed to be relying on its “American-made” status; except it’s not made in the USA. The FTC found (https://www.ftc.gov/enforcement/cases-proceedings/182-3113/underground-sports-inc-doing-business-patriot-puck-et-al) in September 2018 that Patriot Puck often imports their pucks from China.
A few other companies have also recently been caught. PiperGear USA claimed to have a successful U.S. manufacturing plant and used the hashtag #madeinusa on their social media. But the FTC discovered that the company actually imports 95% of their finished products from Mexico and China.
According the FTC, “made in USA” means that “all or virtually all” of the product has been made in America. That means that the parts, assembly, and labor should all be of U.S. origin. These companies got around this rule by hiding the truthful country-of-origin information on the back of the tag in tiny letters, while the “made in usa” claim was on the front in a much larger, more attractive font.
Last Fall, the FTC determined that these companies along with two others had engaged in “unfair or deceptive acts” and thus, violated federal law. Their punishment? Virtually nothing. The FTC made them sign an agreement that barred them from falsely marketing their products again. If they are caught again, they will face a $40,000 penalty. In this instance, they faced no financial penalties and did not have to admit any wrongdoings or notify customers of their false advertising.
But many Democratic lawmakers aren’t happy with the decision and think the consequence should be more severe. “If companies that break our laws do not face financial penalties, then our American manufacturers are severely undermined,” wrote Senator Sherrod Brown of Ohio, “we need stronger enforcement by the FTC and greater transparency when it comes to the commission’s actions to crack down on these violators.”
FTC members responded to Brown’s statement, including that the companies didn’t raise their prices to that of actual American made goods, so they weren’t receiving monetary relief. Members stated that they are looking into the future for solutions so this doesn’t happen again.