2010-21886. Agency Information Collection Activities; Proposed Collection; Comment Request

AGENCY:

Federal Trade Commission (“Commission” or “FTC”).

ACTION:

Notice; request for public comment.

SUMMARY:

The FTC intends to conduct a survey of consumers to advance its understanding of the prevalence of consumer fraud and to allow the FTC to better serve people who experience fraud. The survey is a follow-up to two previous surveys - the first was conducted in May and June of 2003 and the second in November and December of 2005. Before gathering this information, the FTC is seeking public comments on its proposed consumer research. Comments will be considered before the FTC submits a request for Office of Management and Budget (“OMB”) review under the Paperwork Reduction Act.

DATES:

Comments must be submitted on or before November 1, 2010.

ADDRESSES:

Interested parties are invited to submit written comments electronically or in paper form by following the instructions in the Request for Comments part of the SUPPLEMENTARY INFORMATION section below. Comments in electronic form should be submitted by using the following weblink: (https://ftcpublic.commentworks.com/​ftc/​fraudsurvey2010) (and following the instructions on the web-based form). Comments filed in paper form should be mailed or delivered to the following address: Federal Trade Commission, Office of the Secretary, Room H-135 (Annex J), 600 Pennsylvania Avenue, N.W., Washington, DC 20580, in the manner detailed in the “Request for Public Comments” part of the SUPPLEMENTARY INFORMATION section below.

FOR FURTHER INFORMATION CONTACT:

Requests for additional information should be addressed to Keith B. Anderson, Economist, Bureau of Economics, Federal Trade Commission, 600 Pennsylvania Avenue NW, Mail Stop NJ-4136, Washington, DC 20580. Telephone: [phone].

SUPPLEMENTARY INFORMATION:

1. Background

Under the Paperwork Reduction Act, 44 U.S.C. 3501-3521 (“PRA”), federal agencies must obtain approval from OMB for each collection of information they conduct or sponsor. “Collection of information” means agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. 44 U.S.C. 3502(3), 5 CFR 1320.3(c). As required by section 3506(c)(2)(A) of the PRA, the FTC is providing this opportunity for public comment before requesting that OMB grant clearance for the current proposed survey.

In 2003, OMB approved the FTC’s request to conduct a survey on consumer fraud and assigned OMB Control Number 3084-0125. The FTC completed the consumer research in June 2003 and issued its report, “Consumer Fraud in the United States: An FTC Survey,” in August 2004 (http://www.ftc.gov/​reports/​consumerfraud/​040805confraudrpt.pdf).

In November 2005, OMB approved the Commission’s request to reinstate this clearance. The second survey was conducted in November and December 2005. A report, “Consumer Fraud in the United States: The Second FTC Survey,” detailing the results of the second survey, was issued in October 2007 (http://www.ftc.gov/​opa/​2007/​10/​fraud.pdf). The 2005 survey asked about consumers’ experiences with 14 specific and two more general types of fraud during the previous year. Among frauds covered by the survey were whether the person had purchased a weight-loss product that did not work as promised, whether the person had fallen victim to an advance-fee loan scam, and whether the person had paid someone to remove derogatory information from his or her credit report. According to the survey results, 30.2 million adults in the United States - 13.5 percent of all adults in the country - had been a victim during the previous year of one or more of the frauds included in the survey.

Among the 14 specific frauds included in the survey, the most frequently reported was the purchase of a weight-loss product that the seller represented would allow the user to easily lose a substantial amount of weight or lose the weight without diet or exercise. However, in fact, consumers who tried the product found that they only lost a little of the weight they had expected to lose or failed to lose any weight at all. This was experienced by 4.8 million adults - 2.1 percent of the adult population.

2. Description of the Collection of Information and Proposed Use

The FTC proposes to conduct a telephone survey of up to 4,100 randomly-selected consumers nationwide age 18 and over - 100 in a pretest and 4,000 in the main survey - in order to gather specific information on the incidence of consumer fraud in the general population. In order to obtain a more reliable picture of the experience of demographic groups that the earlier surveys found to be at an elevated risk of becoming victims of consumer fraud - including Hispanics, African Americans, and Native Americans - the survey may oversample members of these groups. All information will be collected on a voluntary basis, and the identities of the consumers will remain confidential. Subject to OMB approval for the survey, the FTC will contract with a consumer research firm to identify consumers and conduct the survey. The results will assist the FTC in determining the incidence of consumer fraud in the general population and whether the type or frequency of consumer frauds is changing. This information will inform the FTC about how best to combat consumer fraud.

The FTC intends to use a sample size similar to that used in the 2005 survey. The questions will be very similar to the 2005 survey so that the results from the 2005 survey can be used as a baseline for a time-series analysis.¹ The FTC may choose to conduct another follow-up survey in approximately five years.

3. Estimated Hours Burden

The FTC will pretest the survey on approximately 100 respondents to ensure that all questions are easily understood. This pretest will take approximately 15 minutes per person and 25 hours as a whole (100 respondents x 15 minutes each). Answering the consumer survey will require approximately 15 minutes per respondent and 1,000 hours as a whole (4,000 respondents x 15 minutes each). Thus, cumulative total burden hours for the first year of the clearance will approximate 1,025 hours.

4. Estimated Cost Burden

The cost per respondent should be negligible. Participation is voluntary and will not require start-up, capital, or labor expenditures by respondents.

5. Request for Public Comments

The FTC invites comments on: (1) Whether the proposed collections of information are necessary for the proper performance of the functions of the FTC, including whether the information will have practical utility; (2) the accuracy of the FTC’s estimate of the burden of the proposed collections of information; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of collecting information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses.

Interested parties are invited to submit written comments electronically or in paper form. Comments should refer to “Consumer Fraud Survey 2010, FTC File No. P105502” to facilitate the organization of comments. Please note that your comment - including your name and your state - will be placed on the public record of this proceeding, including on the publicly accessible FTC Website, at (http://www.ftc.gov/​os/​publiccomments.shtm).

Because comments will be made public, they should not include any sensitive personal information, such as an individual’s Social Security Number; date of birth; driver’s license number or other state identification number, or foreign country equivalent; passport number; financial account number; or credit or debit card number. Comments also should not include any sensitive health information, such as medical records or other individually identifiable health information. In addition, comments should not include any “[t]rade secret or any commercial or financial information which is obtained from any person and which is privileged or confidential. . . .,” as provided in Section 6(f) of the Federal Trade Commission Act (“FTC Act”), 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). Comments containing material for which confidential treatment is requested must be filed in paper form, must be clearly labeled “Confidential,” and must comply with FTC Rule 4.9(c), 16 CFR 4.9(c).²

Because paper mail addressed to the FTC is subject to delay due to heightened security screening, please consider submitting your comments in electronic form. Comments filed in electronic form should be submitted by using the following weblink: (https://ftcpublic.commentworks.com/​ftc/​fraudsurvey2010) (and following the instructions on the web-based form). To ensure that the Commission considers an electronic comment, you must file it on the web-based form at the weblink: (https://ftcpublic.commentworks.com/​ftc/​fraudsurvey2010). If this Notice appears at (http://www.regulations.gov/​search/​index.jsp), you may also file an electronic comment through that website. The Commission will consider all comments that regulations.gov forwards to it. You may also visit the FTC Website at (http://www.ftc.gov) to read the Notice and the news release describing it.

A comment filed in paper form should include the “Consumer Fraud Survey 2010, FTC File No. P105502” reference both in the text and on the envelope, and should be mailed or delivered to the following address: Federal Trade Commission, Office of the Secretary, Room H-135 (Annex J), 600 Pennsylvania Avenue, NW, Washington, DC 20580. The FTC is requesting that any comment filed in paper form be sent by courier or overnight service, if possible, because U.S. postal mail in the Washington area and at the Commission is subject to delay due to heightened security precautions.

The FTC Act and other laws the Commission administers permit the collection of public comments to consider and use in this proceeding as appropriate. The Commission will consider all timely and responsive public comments that it receives, whether filed in paper or electronic form. Comments received will be available to the public on the FTC Website, to the extent practicable, at (http://www.ftc.gov/​os/​publiccomments.shtm). As a matter of discretion, the Commission makes every effort to remove home contact information for individuals from the public comments it receives before placing those comments on the FTC Website. More information, including routine uses permitted by the Privacy Act, may be found in the FTC’s privacy policy, at (http://www.ftc.gov/​ftc/​privacy.shtm).

By direction of the Commission.

Donald S. Clark,

Secretary.

Footnotes

1.  The survey instrument for the 2005 Consumer Fraud Survey is attached to the 2007 report as Appendix B.

2.  The comment must be accompanied by an explicit request for confidential treatment, including the factual and legal basis for the request, and must identify the specific portions of the comment to be withheld from the public record. The request will be granted or denied by the Commission’s General Counsel, consistent with applicable law and the public interest. See FTC Rule 4.9(c), 16 CFR 4.9(c).