Federal Trade Commission Act, Section 5 (unfair or deceptive acts or practices)
FTC Act
Comprehensive privacy · Data security
Section 5 bans unfair or deceptive acts or practices in commerce. The FTC uses it as the main federal privacy and data security authority: misrepresenting data practices is deception, and failing to use reasonable security or making harmful data uses can be unfair. Several later privacy statutes (COPPA, PADFA, TAKE IT DOWN) are enforced as if they were FTC rules.
- Where
- Federal
- Citation
- 15 U.S.C. 45
- Status
- In force
- In force since
- 1914-09-26
- Last amended
- 2012-12-04
- Enforced by
- Federal Trade Commission
- People can sue
- No
- Penalties
- No civil penalty for a first Section 5 violation; the FTC obtains orders and consumer redress. Violating a final FTC order or a trade regulation rule (knowingly) carries civil penalties, currently $53,088 per violation (16 CFR 1.98, inflation-adjusted amount in force since Jan. 17, 2025).
- Applies to
- Persons, partnerships and corporations in or affecting commerce, except those carved out in 15 U.S.C. 45(a)(2) (e.g., banks, common carriers, air carriers)
- Nonprofits are generally outside FTC Act jurisdiction
Practices it requires
- Do not make false or misleading statements about how personal data is collected, used, shared, or secured (deception).15 U.S.C. 45(a)(1)
Security duties
- Do not engage in data practices, including unreasonable data security, that cause or are likely to cause substantial injury consumers cannot reasonably avoid and that is not outweighed by benefits (unfairness standard).15 U.S.C. 45(a)(1), (n)
Other duties
- Comply with FTC cease-and-desist and consent orders (often 20-year privacy or security program orders); each violation of a final order carries a civil penalty.15 U.S.C. 45(l)
- Knowing violations of FTC trade regulation rules (including privacy rules deemed FTC rules by statute) carry civil penalties.15 U.S.C. 45(m)(1)(A)
Sources
- Official text
- 15 U.S.C. 45 (Office of the Law Revision Counsel)
- 16 CFR 1.98 civil penalty adjustments (eCFR)
Checked against these sources on 2026-09-25 by research agent (Claude), primary sources.
Unverified: effective_date uses the 1914 enactment date; the 'unfair or deceptive acts or practices' language was added by the Wheeler-Lea Act of 1938, whose date was not separately verified
Research reference, not legal advice.