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A Guide to Deceptive Trade Practices: What to Look Out For

Imposter scams, identity theft, robocalls, and fake debt collection are just a few of the things consumers have to worry about these days. In 2019 alone, there have been over 120,000 reported cases of identity theft. 

What’s even worse is when trusted companies deceive their customers on purpose. These incidents are known as deceptive business practices. And they come in many forms.

Though there are laws against such practices, it still happens every day in America. Keep reading for the most common types of unfair trade practices and how to avoid them. 

Examples of Deceptive Business Practices

In most cases, deceptive business practices have to do with a company providing misleading or inaccurate information regarding the goods and services they offer.

The most common form of unfair trade practice is false advertising. Companies who knowingly advertise misleading information about their goods, services or current deals or offerings can be found guilty of deceptive trade practices.

The most common form of unfair trade practice is false advertising. Companies who knowingly advertise misleading information about their goods and services are guilty. 

There are many forms of deceptive trade that fall under the umbrella of false advertising. For example, advertising price reduction deals without the intention to honor the deal.

Or, claiming a product is new or original if it’s really second-hand. Or if it’s an imitation of a previously released product. 

Another example is stating that a product contains certain ingredients or features that it does not actually have. The same goes if a company advertises a product to be of a certain quality or grade when it is not. 

Companies who partake in this type of misleading advertising are liable under the Federal Trade Commission Act

Another common example is when a company’s representative tampers with measuring equipment. Such as energy or water meters.

It can also extend past goods and services to business practices. Including unfair edits to contracts or using coercion to make a sale. 

Deceptive Pricing

False advertising, tampering with equipment, unfair contracts and coercion are all punishable by law in the United States. Consumers should also look out for deceptive pricing practices.

It is illegal for companies to provide misleading or inaccurate pricing information about their products. This includes stating wrong or misleading prices on competitor’s items to make their products seem cheaper. 

Some companies get creative with their pricing strategies. Sometimes they’ll do things like place price stickers stating a higher price to make it seem like the product is priced down. This is also illegal and punishable by the FTC. 

How to Avoid Deceptive Trade Practices

The best way to avoid deceptive businesses is due diligence. Do your research and only work with and buy from reputable companies. 

If you feel you’ve been targeted by a company’s deceptive trade practices, you could be eligible for compensation.

The first step is to send the merchant a “30 Day Demand” letter including your full name and address, receipts, and a detailed account of what took place.

If you do not receive a response, you may then want to consider legal action. Consumers in Texas can find a good attorney here.

To Summarize

Any measure taken to mislead the customer whether it’s due to inaccurate product specifications, misleading pricing, phony special offers, tampering or coercion is considered a deceptive trade practice.

Contact us if you feel you have been wronged by a company’s deceptive business practices or if you have any other legal problems. 

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