May 3, 2023

Podcast - Uncovering the FTC's Criminal Liaison Efforts

Clearly Conspicuous Podcast Series

In this episode of his "Clearly Conspicuous" podcast series, "Uncovering the FTC's Criminal Liaison Efforts," consumer protection attorney Anthony DiResta discusses the Federal Trade Commission's (FTC) Criminal Liaison Unit (CLU) and its role in consumer protection and enforcement activity. Established 20 years ago, the CLU refers criminal cases related to consumer fraud to prosecutors, resulting in 145 convictions and 746 years of total sentencing over the past five years. The podcast outlines the history, strategy and operations of the CLU and its relationships with various law enforcement entities. The key takeaway emphasizes the importance of compliance and risk management in avoiding potential investigations and ensuring fair business practices.

Listen to more episodes of Clearly Conspicuous here.


Good day, everyone. It's a privilege to be with you today. Today we talk about consumer protection and criminal activity. Today's topic is the Federal Trade Commission's (FTC) Criminal Liaison Unit. History of the FTC's Criminal Liaison Unit (CLU) The FTC, which is not authorized to bring criminal law enforcement actions, established a Criminal Liaison Unit (CLU) in its Bureau of Consumer Protection about 20 years ago to bring offenders to the attention of prosecutors. Over the past five years, the CLU has referred many criminal charges against 107 new defendants. That's the last five years. 145 total convictions were made, with 181 defendants sentenced for consumer fraud. The total sentence time for these defendants was 746 years, with an average of approximately 4.3 years of incarceration. Now, let me give you a little bit of the history and background of the CLU with the FTC. Throughout the 1990s, the FTC's broad program grew substantially. However, the commission's actions exposed a gap, specifically the remedies available to the FTC. That is, monetary and injunctive relief failed to fully detect some hardened fraudsters. To fill this gap, in 2002, the commission established the CLU program to bring the offenders to the attention of criminal prosecutors. As the CLU grew, the program worked to address prosecutors’ concerns and help them prosecute cases. Toward this end, CLU chiefs have strategically recommended cases most likely to be attracted to criminal authorities. They looked at things like compelling evidence, jury appeal and the potential for significant sentences. Using this strategy, the CLU built strong relationships with prosecutors by presenting good cases. How the CLU Operates In terms of the CLU’s program operations, the program operates under the direction of the CLU Chief, and the chief position is a two-year appointment. Each CLU Chief conducts at least one project during his or her tenure to strengthen the program and increase its institutional knowledge. Past projects included the building of a searchable library or database of charging documents for prosecutors and the creation of an index knowledge bank of research and model documents. The CLU Chief also regularly conducts outreach to existing law enforcement partners and pursues new relationships. The CLU has built robust relationships with many U.S. Attorney’s offices, divisions of the Justice Department, federal investigative agencies, and state and local authorities. FTC Priorities for the CLU Let’s look to the future here and see what the FTC says about the CLU’s current priorities. They say that they want the CLU to continue to build relationships within the FTC and other agencies to conduct and participate in meetings regularly with federal, state and local criminal authorities, and to continue to offer training for law enforcement partners on the Consumer Sentinel Database, which is the database at the FTC that collects complaints from consumers, Better Business Bureaus and local attorney general offices. I experienced firsthand, while I was the director of the FTC Southeast Regional Office, the commission's interest in criminal prosecution. I was appointed a special United States Attorney in Atlanta to prosecute mail and wire fraud. My office also won an award from the United States Attorney General for its criminal prosecution successes for telemarketing fraud. Key Takeaway So here's the key takeaway. While the FTC's jurisdiction is civil, not criminal, the FTC pays close attention to unfair and deceptive practices that may constitute mail and wire fraud. The FTC is currently focused on bringing actions against individuals, including senior and C-suite executives. That's why compliance and risk management is critical. If you get a subpoena or a civil investigative demand from the FTC or any other regulator, take it seriously. Management of these investigations is essential. Avoid crisis management situations. So stay tuned to further programs as we identify and address the key issues and developments and provide strategies for success. I wish you continued success and a meaningful day. Thank you.

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