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How Do FTC Civil Investigative Demands Fit Into Broader FTC Investigations?
How FTC civil investigative demands (CIDs) fit into broader FTC investigations:
CIDs are a form of compulsory process similar to subpoenas that the FTC uses to obtain documents, information, and testimony to advance its consumer protection and competition investigations (Search results 1, 2, 6). They allow the FTC to gather facts and data related to potential violations of laws it enforces.
FTC investigations typically start informally, where the FTC gathers publicly available information and contacts the company. If the issue seems significant within the FTC’s jurisdiction, it assigns an attorney-examiner to get more information, which can include issuing a CID (Results 1, 8, 15).
If voluntary compliance is not achieved through the investigation, the FTC may initiate litigation through an administrative proceeding or federal court action. Failure to comply with a CID can also trigger the FTC to take legal action to enforce it (Results 1, 5, 8, 14).
The FTC takes CID compliance seriously. It tries to work with recipients to ease burdens when possible but will compel compliance if needed, including through court orders and contempt charges for disobeying orders. Over the past three years it has filed 12 enforcement actions for non-compliance (Results 6, 19).
Potential outcomes after an investigation using CIDs include the FTC closing it with no action, the company agreeing to a consent decree to settle alleged violations, or the FTC initiating administrative or court proceedings against the company. In rare cases there may be criminal referrals (Results 8, 15).
In summary, CIDs are a critical investigative tool for the FTC. The agency relies on them to determine if consumer protection or antitrust laws have been violated before deciding on potential enforcement actions. Failing to properly respond puts companies at greater risk.