In late 2023, the Federal Trade Commission (FTC) signed a cooperation agreement with the consumer protection authorities of the four Latin American countries–Chile, Colombia, Mexico, and Peru– to combat fraud both inside and outside the United States.

The Multilateral Memorandum of Understanding (MMOU) promotes cooperation across Latin America, including information-sharing to further investigations and policy development, as well as other types of assistance on cross-border enforcement matters.

Low-cost online communications allow scammers to target consumers regardless of where they live. The increasingly global nature of commerce—and fraud—poses an enforcement challenge for consumer protection authorities around the world. From 2019 to 2022, fraud reports against companies in Chile, Colombia, Mexico and Peru more than doubled, from 6,103 to 12,869. At the same time, total losses reported by consumers skyrocketed—from $39.4 million in 2019 to $237.9 million in 2022. Reports about online shopping were the top complaint during this same period, with losses increasing from $3.8 million in 2019 to $49.5 million in 2022. Social media was the top contact method consumers cited at 41 percent of reports in 2022. These four countries represent about 225 million people and combined make up the eighth biggest economy in the world.

In signing the MMOU, the FTC and consumer protection authorities in these countries agreed to cooperate in investigations related to violations of consumer protection laws. Specifically, the MMOU encourages participants to:

• Share complaints submitted by consumers;
• Provide investigative assistance, with appropriate safeguards, including sharing of information relating to defendants, their assets and/or their deceptive conduct;
• Coordinate enforcement actions against cross-border violations of law;
• Provide other practical case assistance, where appropriate, in the enforcement of consumer protection laws, such as gathering evidence;
• Participate in econsumer.gov, which allows consumers from around the world to report fraud and provides consumer protection agencies around the world with access to important data about potential violations;
• Cooperate on non-investigatory matters such as exchanging approaches to consumer protection policy issues and participating in staff exchanges, joint training programs and workshops.

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Teaching Suggestions:

• Ask students to debate the issue “Should governmental agencies be involved in protecting consumers”? Why or why not?
• Ask students to make a list of national and international consumer protection agencies where they can report international and national scams and to learn about other steps they can take to combat fraud.

Discussion Questions:

1. What actions can consumers take to protect themselves from national and international scams?
2. How can your complaints help consumer protection agencies around the world to spot trends and work together to prevent international scams?