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Consumer Advocacy and Protection

Nongovernmental agencies that provide information for protesters has not proved successful. In addition, turn-
for consumers include the Better Business Bureau, a pri- ing to the law for help can turn into a public relations dis-
vate, nonprofit organization that works to resolve com- aster for companies, making a small problem into a much
plaints consumers have with businesses. The Consumer bigger one. “The Internet is an uncontrollable beast,”
Federation of America is the one of the largest consumer attorney Simon Halberstam told Reeve. “While legally the
advocacy groups in the United States, consisting of about firm may have recourse to law, the reality is that they may
300 member organizations representing 50 million peo- just have to accept the problem and carry on with their
ple. The International Organization of Consumers business.”
Unions, based in the Netherlands, actively promotes con-
sumer interests on a global scale. Other well-known con-
TECHNOLOGY OFFERS MIXED BAG
sumer advocacy groups include: Public Citizen, founded
FOR CONSUMERS
by Ralph Nader; the Consumers Union of the United
The Internet age has provided consumers with unprece-
States, which publishes Consumer Reports; and the
National Consumers League. dented access to information and an often-overwhelming
abundance of choices, but it has also exposed them to
new types of fraud. “The deregulation and technological
CONSUMER ADVOCACY IN
revolution that gave us all these new responsibilities and
CYBERSPACE choices were also supposed to release the genius of the
In the early 1990s, the widespread use of home comput- free market, which would drive down prices and create
ers advanced consumer advocacy by making it easier for innovative comparison-shopping tools,” Kim Clark
citizens to gather information and make their views wrote in U.S. News and World Report. “But the antici-
known. By the early twenty-first century, the Internet had pated information explosion hasn’t kept up with con-
become one of the primary weapons of consumer advo- sumers’ needs.”
cates, with untold thousands of “so-called global ‘gripe
According to the National Consumers League, con-
sites’ established by campaigners or disgruntled customers sumer losses to telemarketing and Internet scams during
with the aim of harassing and haranguing large compa- the first six months of 2005 were more than double the
nies,” according to Simon Reeve in the European.
average from 2004. Telemarketing fraud victims lost an
Before the advent of the World Wide Web, it was dif- average of $4,107 during the first half of 2005, compared
ficult for individuals or small groups, which lacked the to $1,974 in 2004. This increase came despite efforts by
resources of major corporations, to make their voices the FTC to reduce consumers’ exposure to unwanted tele-
heard over their targets’ advertising messages. “But the marketing calls through registry on the National Do Not
Internet has created a level playing field for advocacy,” Call List, which received widespread praise from con-
Reeve wrote. “With little more than a personal computer sumer advocacy groups. Similarly, Internet fraud victims
and a subscription to an Internet service provider, anyone lost an average of $2,579 in 2005, compared to $895 in
can open a site on the World Wide Web and say more or 2004. Federal efforts to reduce spam and other sources of
less whatever they like.” Current and potential customers Internet fraud have not been particularly successful.
of major corporations typically use common Internet
search engines to access the companies’ carefully prepared SEE ALSO Consumer Bill of Rights; Consumer Protest
home pages. Yet these search engines also lead the cus-
tomers to sites created by protesters—sites that are filled BIBLIOGRAPHY
with complaints and allegations against the companies, Clark, Kim (2003, August 18). Customer disservice. U.S. news
ranging from the use of child labor to the exploitation of and world report, 29.
resources in less-developed countries. Thus, for consumer Mayer, Robert N. (1989). The consumer movement: Guardians of
advocates, “the Internet means a new freedom to take on the marketplace. Boston: Twayne.
the mightiest corporations, in an environment where mas- National Consumers League. (2005, June). Mid-year fraud stats
sive advertising budgets count for little,” Reeve stated. reveal alarming trends in telemarketing, Internet scams. NCL
For businesses, on the other hand, Internet gripe sites news. Retrived August 11, 2005, from
pose a difficult problem. Although the material posted on http://nclnet.org/news/2005/fraud_trends_june2005.htm
such sites might be distorted, false, or even outright Reeve, Simon (1998, January 26). Web attack. European, 20.
libelous, it can still prove damaging to a company’s image. Unsafe at any megahertz: Ralph Nader is taking on Bill Gates. Is
consumerism still a force in America? (1997, October 11).
Moreover, few legal remedies exist as the law struggles to
Economist, 80.
keep up with technology. It is often difficult for compa-
nies to trace the operators of gripe sites, for example, and
suing the Internet service providers that provide a forum Laurie Collier Hillstrom

138 ENCYCLOPEDIA OF BUSINESS AND FINANCE, SECOND EDITION