FTC Defends Corporate Backgrounds After Report Claims Tech Influence
The FTC defended the backgrounds of top agency officials Thursday after Public Citizen argued the agency’s cozy relationship with industry is creating a timid enforcement culture. At least 75 percent of the officials whose backgrounds it studied represented corporate clients before joining or after leaving the agency, or both, Public Citizen reported Thursday. The group looked at 41 FTC commissioners and directors of the Competition and Consumer Protection bureaus spanning the past 20 years. It said more than 60 percent worked on behalf of the tech industry at some point for clients like Facebook, Google, Microsoft, Uber and Intel.
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A spokesperson defended the agency in an email: “FTC employees follow all government post-employment restrictions and comply with all ethics rules. We are pleased that historically, FTC leaders bring their high level of expertise and experience in their fields to the agency when serving the public.”
One official named in the report argued industry experience can make potential employees more well-rounded. He said he’s never met someone hired by the FTC who had a predetermined, pro-industry agenda before joining the agency. More than a dozen former officials named in the report didn’t comment when contacted by us.
Of 25 commissioners and chairs Public Citizen reviewed, 17 served corporate interests and 13 worked for the tech sector. Six of 10 Democratic FTC members served the tech sector, compared with seven of 14 Republicans. All nine Competition directors worked for the tech sector, compared with four of seven Consumer Protection directors.
Research Director Rick Claypool said Public Citizen manually gathered information from databases like Center for Responsive Politics, officials’ financial disclosure forms and internet archives of law firm websites. He said the results are a potential “undercount,” because some of the officials’ conflicts might not be publicly listed. FTC officials are drawn to these “plum” positions at major U.S. corporations because it boosts their prestige, Claypool said: Companies seek them out because they have very specific expertise that can be very valuable during investigations. It’s harder to trust officials are working in the public’s best interest if almost all of them end up defending corporate America, he said.
It isn’t that difficult to understand why many believe such a crossover creates conflicts, said Hinch Newman internet advertising and marketing compliance attorney Richard Newman, who represents clients before the FTC. However, he added, it’s not so black and white: “To be effective, a regulatory agency needs to have a sophisticated understanding of how those that it seeks to regulate operate. In that sense, an insider’s perspective can be a good thing.”
Some of the agency’s “perceived reluctance” is the result of political history, said Center for Democracy & Technology Policy Counsel-Privacy & Data Project Joseph Jerome. The agency’s reputation as “national nanny” and having Magnuson-Moss Warranty Act rulemaking authority have left “some long-term scars” separate from revolving door issues, he continued: “It was only a few years ago when the Republican House was exploring about a dozen process bills that would have further weakened the FTC, which I think explains some of the perceived timidity.”
Public Citizen repeated its call for a new data protection agency to replace the FTC: “If new authority is to be lodged at the FTC, then, at minimum, tighter restrictions should be placed on the FTC-tech sector revolving door.” World Privacy Forum Executive Director Pam Dixon disagreed with the suggestion. The FTC is the proper privacy enforcer, but it requires additional resources, personnel and authority, she said.