FTC Files First Enforcement Action Under INFORM Consumers Act Against Online Marketplace Temu
The Federal Trade Commission (FTC) has announced a significant milestone in its efforts to enhance online marketplace transparency and consumer protection, filing its first enforcement action under the INFORM Consumers Act. The action, announced on September 5, 2025, targets the rapidly growing online marketplace, Temu.
The INFORM Consumers Act, enacted to combat the sale of counterfeit and dangerous goods online, aims to hold online marketplaces more accountable for the products sold on their platforms. A key provision of the act requires marketplaces to implement reasonable “Know Your Business Partner” (KYBP) verification procedures for “high-volume” third-party sellers. This means marketplaces must collect and verify information about these sellers, such as their name, physical address, and contact information. The goal is to make it more difficult for illicit actors to operate anonymously and shield themselves from accountability for the products they offer.
The FTC’s complaint alleges that Temu has failed to meet these requirements, thereby contributing to the proliferation of potentially harmful and counterfeit products reaching consumers. While specific details of the alleged violations will be further elaborated in the legal proceedings, the FTC’s action underscores their commitment to actively enforcing the provisions of the INFORM Consumers Act.
This development represents a crucial step in the FTC’s ongoing mission to foster a safer and more trustworthy online marketplace environment. By bringing this enforcement action, the FTC signals to all online marketplaces the seriousness with which they view compliance with the INFORM Consumers Act and the potential consequences of failing to do so.
Consumers have expressed growing concerns about the prevalence of counterfeit and potentially unsafe goods sold through various online platforms. The INFORM Consumers Act was designed to address these concerns by introducing greater transparency and accountability. The FTC’s action against Temu is expected to encourage other marketplaces to strengthen their own verification processes and seller due diligence, ultimately benefiting consumers by reducing their exposure to fraudulent and dangerous products.
The FTC will continue to monitor compliance with the INFORM Consumers Act and take appropriate action to protect consumers from the harms associated with the sale of illicit goods online. This initial enforcement action serves as a clear message that the agency is prepared to utilize the tools provided by the Act to ensure a more secure marketplace for all.
First INFORM Consumers Act enforcement case filed against online marketplace Temu
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