Schakowsky, Welch Introduce Bicameral Legislation to Enhance Consumer Protection, Hold Mega-Corporations Accountable for Consumer Safety Violations
WASHINGTON – Today, U.S. Representative Jan Schakowsky, Ranking Member of the House Innovation, Data, and Commerce Subcommittee, and Senator Peter Welch (D-VT)introduced the Consumer Advocacy and Protection (CAP) Act, legislation to enhance consumer protection and ensure the Consumer Product Safety Commission (CPSC) can hold companies accountable for consumer safety violations. The CAP Act aims to deter companies from committing safety violations by increasing CPSC’s penalty authority.
“The current cap limits on civil penalties have allowed big corporations to skirt real responsibility when their products are found to be harmful, and in some cases, deadly. Companies must feel the effects when they violate consumer safety protections,” said Congresswoman Jan Schakowsky. “That is why I am proud to introduce the CAP Act to strengthen deterrence against safety violations, better reflect the severity of offenses, and hold violators accountable. I will continue to work with my colleagues and the Consumer Product Safety Commission to ensure we are doing everything possible to help guarantee that the products people buy for themselves, and their children are safe.”
“Integrity and transparency are crucial to ensuring consumer protection, but massive companies continue to undermine federal safety standards by relying on their wealth to evade responsibility,” said Senator Peter Welch. “The CAP Act will help ensure corporations are held accountable when they violate consumer safety protections. This bill strengthens the incentives to prioritize product safety and helps the Consumer Product Safety Commission do their critical work.”
“Consumers deserve safe products,” said Courtney Griffin, Director of Consumer Product Safety at Consumer Federation of America. “Civil penalties are an important tool to discourage manufacturers from taking risks that hurt or kill consumers. We applaud Sen. Welch and Rep. Schakowsky for introducing this legislation, which will protect consumers and ensure the Consumer Product Safety Commission can hold companies accountable.”
“When companies don’t follow our safety laws, they put people across the country at risk,” said Gabe Knight, Safety Policy Analyst for Consumer Reports. “The current civil penalties cap leaves fines much too low to deter giant, multibillion-dollar companies from breaking the law. The CAP Act would help hold companies accountable for safety violations and protect consumers from dangerous products. Consumer Reports is proud to support the bill and urges all members of Congress to support it.
“An increase in civil penalties is long overdue for companies that endanger consumers and deceive regulators. As it is, the penalties are like small change found between the couch cushions in the C-suite. This needs to change. While the CPSC raised the cap to $120,000/$17.5 million in 2021, a future CPSC could reduce it. Congress hasn’t raised the cap for 16 years,” said Teresa Murray, Consumer Watchdog Director, U.S. Public Interest Research Group. “Both Democratic and Republican appointees to the CPSC have said the current caps aren’t enough to hold multi-billion-dollar corporations accountable. All companies should face meaningful penalties if they intentionally put our families and homes at risk.”
Under current law, manufacturers, importers, and distributors of consumer products are required to report immediately to the CPSC information that reasonably supports the conclusion that a product contains a defect that could create a substantial product hazard or an unreasonable risk of serious injury or death. If violations occur, the applicable civil penalty is a maximum of $100,000 per individual violation and $15,000,000 for a series of related violations. These amounts were adjusted for inflation in 2021, reaching $120,000 per violation and $17,150,000 for a series of related violations. The CPSC is allowed to adjust the maximum civil penalty amounts every five years for inflation.
The CAP Act would:
- Strike the maximum civil penalty cap on a series of violations.
- Increase the individual violation cap from $100,000 to $250,000.
- Add clarity into statute about the types of offenses CPSC can fine manufacturers for and subject those civil penalties to the same caps as described above.
- Adjust the inflation review period from every five years to every year.
- Create a new formula for inflation adjustments and set a time frame and procedures for these adjustments.
The CAP Act is also cosponsored by U.S. Representative Bonnie Watson Coleman (NJ-12) and U.S. Senators Richard Blumenthal (D-CT), Edward Markey (D-MA), Brian Schatz (D-HI), and Ben Ray Luján (D-NM).
The CAP Act is endorsed by the Consumer Federation of America, Consumer Reports, Kids in Danger, Public Citizen, and the U.S. Public Interest Research Group.
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