Private parties who inform authorities, news media, or the pubic about fraudulent, illegal, or unethical business practices are known as “whistleblowers.” This colloquial term derives its origins from a sports referee or police officer who blows a whistle to signal improper conduct of some sort.

Unlike sports events or traffic violations, the fouls called by whistleblowers contemplated in this Article have much more far-reaching impact and consequences. The misconduct these informants help ferret out can - and often does - place large numbers of people in serious jeopardy.

In the context of consumer protection, whistleblowers reveal legal violations that run afoul of legislation or regulations specifically designed to promote public health, safety, or welfare.

Consumer Protection Legislation

As the name implies, consumer protection seeks to safeguard the public against perilous conditions or practices. Many state and federal statutes exist to serve these valuable ends in many contexts. The concept of consumer protection finds its US genesis during the Industrial Revolution.

Deplorable work conditions and widespread exploitative labor practices spurred a spate of legislation designed to prevent and penalize unscrupulous employers. From this early beginning, consumer protection has expanded into many arenas outside the realm of employment and labor.

Contemporary Legal Stance

Due its social importance and political sensitivity, consumer protection is an especially dynamic area of American jurisprudence. Modern consumer protection laws permeate every aspect of business and industry. Package labeling, workplace safety, and permissible product ingredients are just a few arenas that fall within the auspices of consumer protection.

In the strictest legal construction, the False Claims Act (“FCA”) is not a consumer protection law. Nonetheless, many of its provisions serve to promote and facilitate consumer protection. In today’s competitive marketplace, many businesses seek to shirk legal compliance obligations with consumer protection legislation. Such noncompliance gives the business an unfair economic edge while imperiling unwary consumers.

Violations of consumer protection legislation is often denoted as “consumer fraud.” in general, consumer fraud encompasses a broad range of commercial malfeasance, including but not limited to:

• False or misleading advertising
• Grossly overcharging for goods or services
• Marketing substandard products
• Insurance fraud
• Contract interpretation so as to unfairly disadvantage consumers. Such exploitative “agreements” are also known as “adhesion contracts” in legal parlance

The 2010 Consumer Protection Act

The Dodd–Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203, H.R. 4173, is a US statute enacted on July 21, 2010. This recent legalization provides major incentives for whistleblowers to disclose fraudulent activity. The range of reported misconduct may encompass accounting fraud, insider trading, and violations of the Foreign Corrupt Practices Act.

The specific Federal statutes amended by the Act include:

• Commodity Exchange Act
• Consumer Credit Protection Act
• Federal Deposit Insurance Act
• Federal Deposit Insurance Corporation Improvement Act of 1991
• Federal Reserve Act
• Financial Institutions Reform, Recovery, and Enforcement Act of 1989
• International Banking Act of 1978
• Protecting Tenants at Foreclosure Act
• Revised Statutes of the United States
• Securities Exchange Act of 1934
• Truth in Lending Act

In conjunction with the FCA, the Dodd Frank Act represents a major overhaul in the American legal landscape. The protections and incentives for whistleblowers who reveal consumer fraud are extensive. The legislation reflects the changed attitudes and perceptions toward the men and women of fortitude and integrity who come forward to expose corporate corruption.

This should serve as a beacon of hope and encouragement for parties with knowledge of fraudulent government and consumer business acts. Only by such continued vigilance will we all benefit as a society from the corrective and deterrent effects of the evolving statutes. Action by the citizenry is the only means of assuring that the high purposes of consumer protection will be served, and that laws designed for the public benefit do not remain mere dead letter or legal “paper tigers.”