Chapter VII FIELD OPERATIONS The authority of the Bureau of Field Operations was expanded during fiscal 1970. Under the Commission directive of February 24, 1970, the field offices were authorized to serve not only as the investigative arm of the Commission as heretofore, but also to undertake administrative trial of cases of a regional nature and to perform all duties concomitant with adversary proceedings in such matters. The delegation of authority to conduct trials has stimulated the field attorneys to greater interest. There were, by the end of the fiscal year, a number of cases in the field offices which would go to trial shortly. The authority to try cases in the field offices will undoubtedly increase the number of complaints issued and trials held in the next fiscal year. Authority to issue subpoenas where informants refuse to cooperate in furnishing information pertinent to investigations was also conferred upon the attorneys in charge of the field offices and their assistants. The major field activity for the fiscal year continued to be case investigation and settlement. During fiscal year 1970, two new consumer statutes to be administered by the Commission went into efect, i.e., the Truth-in-Lending and the Fair Packaging and Labelng Acts. Field offices bore a major share of the effort of the Commission in getting the implementation of these statutes undervay. A large scale educational effort, particularly in Truth-in-Lendng, devolved upon the field offices. At the same time, however, enorcement of the disclosure and other requirements of the 'ruth-in-Lending statute and Regulation Z issued pursuant thereto as also initiated. Enforcement work by field offices under the Truth-in-Lending atute consisted largely of correcting lesser violations where these ere discovered and the creditor voluntarily agreed to comply with the requirements of the statute. There were 10,129 minor violations investigations instituted under Truth-in-Lending during the fiscal year, in which 8,331 corrections were obtained. Issuance of complaints was recommended by the field in nine Truth-in-Lending cases. Field office attorneys delivered speeches on Truth-in-Lending requirements to interested groups on 691 occasions during the past fiscal year. Attendance at these meetings ranged from 25 to 1,000 persons. During fiscal year 1970, the Commission undertook two new programs designed to broaden the participation of Federal, State and local law enforcement agencies as well as private individuals and private and quasi-public organizations in consumer problems and to bring together those agencies and individuals concerned with consumer problems in a coordinated effort to protect the buying public from advertising and selling practices which are fraudulent. deceptive and unfair. Field offices have had a significant role in or ganizing and coordinating the operation of these programs. The first of these programs involves the Consumer Protection Coordinating Committees which ultimately will be established in each of the principal metropolitan areas in the Nation where the bulk of retail business is concentrated. Priority was given during the year to organizing these committees in the 15 largest metropolitan areas. Chicago, Los Angeles. San Francisco and Washington, D.C., had committees in actual operation by the close of the fiscal year. Preliminary agreement to set up such committees in Detroit, Philadelphia, New York and Boston had been reached. Negotiations were still in the formative stages with regard to Pittsburgh, Cleveland, St. Louis, Minneapolis-St. Paul, Dallas-Fort Worth, and Charlotte-Greensboro-Columbia. The coordinating committees in each instance will function by means of regular meetings of representatives from participating enforcement agencies at one table in order to: Bring to bear Federal, State and county or city laws to stop fraudulent and deceptive practices; • Pool information to establish priorities for efforts in both education and enforcement; • Give each metropolitan area a one-stop complaint service in that a complaint filed with any of the major agencies in the area will be transferred automatically to the right one without further effort; • Determine the patterns of violations in an area or larger segment of the country; • Avoid duplication of effort among consumer protection agencies and develop a "quick response" liaison system among them. As each Consumer Coordinating Protection Committee is established, arrangements are made for feeding all consumer complaints received by the constituent enforcement members into an automated data processing system which will disclose not only the patterns of violations and the most common deceptive practices being engaged in, but also will identify the types of businesses in which these violations occur, as well as the specific business concerns against which such complaints are being lodged. Printouts of the complaints are made for the use of all constituent members in the enforcement of their laws and regulations. The FTC field office in whose territory a particular committee is located furnishes the necessary staff personnel for coordinating and managing the activities of the committee. The second consumer program inaugurated by the Federal Trade Commission through its field offices during fiscal year 1970 involves Consumer Advisory Boards to provide an additional input to the Commission. The boards are made up of representatives of consumer, business and other community groups concerned with consumer problems. The first Consumer Advisory Board was organized and established in New Orleans. Its membership consists of, among other groups, the local better business bureau, the bar association, legal services, the Louisiana Consumer League, CORE and the New Orleans Retail Grocers Association. At the end of fiscal 1970, other boards were in process of being organized in Seattle, San Francisco, Chicago and other cities. The Consumer Advisory Boards are expected to fulfill at least three functions which will advance the public interest in effective enforcement of laws designed to protect the consumer. First, the board will provide an additional informed source of consumer complaints for consideration by the Commission. Second, it will provide a useful vehicle by which the Commission can implement its consumer information program by channeling information to large groups of consumers represented by the board. Third, the board can provide the Commission with insight into novel or emerging consumer problems which may require legislative remedies or provide a basis for direct action in the form of test cases. Complaints filed with private and quasi-public agencies such as OEO assistance offices, Urban Leagues and Better Business Bureaus will not be entered into the Coordinating Committees' complaint system. Yet, complaints made to such agencies can also reveal patterns of violations as important as those disclosed by the complaints filed with law enforcement bodies. In reverse, the members of the advisory boards can contribute to law enforcement processes by providing important channels of information to interested consumer groups for such consumer education materials as may, from time to time, be published by the Commission. Field offices were authorized to start preliminary investigations without prior permission from headquarters in order to expedite handling of complaints received from the public. This program was begun in October 1969 on a 6-month pilot project. Before the 6month period had expired, the program had pointed to sufficient promise and success for the Commission to feel warranted in incorporating this function in the enlarged responsibilities and duties which the Commission approved in February 1970 for the field offices. During the approximately 9 months of the fiscal year 1970 that this program was in effect, the field offices started preliminary investigation in 46 restraint of trade matters and 601 deceptive practice cases. Of these, 22 restraint of trade and 303 deceptive preliminary investigations have been completed. Minor violations corrections were obtained in a total of 132 matters and full-scale investigations were recommended in 59 situations. Preliminary investigations were closed in 134 instances where the investigation failed to reveal merit to the complaint or Commission jurisdiction in the matter. Where appropriate, the latter were referred to other Federal or local enforcement agencies. The preliminary investigation program is growing steadily, particularly since consumers and businessmen and others are becoming more conscious of the Federal Trade Commission as a consequence of the wide publicity being given to its work and enforcement. Preliminary investigations are a bridge between the informal activities of the field offices and the formal full-scale investigations. The informal activities of the field offices during fiscal 1970 involved some 60,359 telephone, written and personal contacts from the public with the field offices as compared to 30,662 for fiscal 1969. This was an increase of 29,797 or 96.8 percent over fiscal 1969. Furthermore, the field offices furnished speakers to groups interested in the work of the Federal Trade Commission on 1,023 occasions, and there were 5,536 other contacts initiated by the field offices with the public. Included in the information inquiries to the field offices were 2,939 written applications for complaints of which 1,544 were disposed of by the field and 1,342 referred to headquarters in Washington for handling. There were also 9,225 oral applications for complaint received in the field offices, of which 8,935 were handled by the field and 290 referred to headquarters for disposition. The 12,163 written and oral applications for complaint for the fiscal year 1970 represented a 32-percent increase over the 9,234 applications for complaint received during fiscal 1969. The number of formal seven-digit investigations completed by the field offices during fiscal 1970 was 861 or 4.66 per attorney. This was a decrease from the 957 investigations completed in fiscal 1969. The total workload of formal seven-digit investigations in the field in fiscal 1970 was 1,211 cases. This included the 606 cases referred to the field offices for investigation during the fiscal year. There was a decrease of 172 cases from the 778 cases referred to the field offices for investigation in fiscal 1969. The field offices negotiated and prepared Affidavits of Discontinuance in 44 deceptive practice, nine textile and fur and 14 restraint of trade cases for a total of 67 cases. It also negotiated Affidavits of Discontinuance in 32 other matters which were prepared at headquarters. In addition the field staff prepared proposed complaints and orders in 41 deceptive practice, eight textile and fur and five restraint of trade matters in which the field offices negotiated consent settlements. In another 40 deceptive practice and 156 textile and fur, or a total of 196 cases, headquarters referred proposed com |