The U.S. Federal Trade Commission (FTC) has stepped up its enforcement of product labeling laws by issuing warning letters to several companies for falsely promoting their products as “Made in USA.” In a recent move, the agency has made it clear that brands must be more truthful and transparent when using this highly valued label.
The FTC’s actions reflect a broader effort to protect consumers from deceptive marketing practices and ensure that companies are held accountable for the claims they make—especially when it comes to patriotic branding.
Why the ‘Made in USA’ Label Matters
The ‘Made in USA’ label carries strong emotional and economic weight. It suggests high quality, supports local jobs, and implies that the product meets certain standards of domestic manufacturing.
According to the FTC, many American consumers prefer to buy U.S.-made goods, and some are even willing to pay more for them. But when companies falsely claim domestic origin, they mislead buyers and undermine honest competitors.
“False ‘Made in USA’ claims cheat both consumers and businesses that play by the rules,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “We will continue to take action against deceptive labeling to ensure fair competition and informed choices.”
What the FTC Requires
Under FTC guidelines, companies can only market a product as “Made in USA” if:
- All or virtually all of the product is made in the United States.
- Final assembly or processing takes place in the U.S.
- No or negligible foreign content is involved.
In July 2021, the FTC finalized a rulemaking process that gave the agency stronger enforcement power, including the ability to seek civil penalties for violations.
Details of the Recent Warning Letters
As of mid-2025, the FTC has sent more than a dozen warning letters to companies across various industries—ranging from automotive parts to clothing and home improvement products.
These letters caution the companies that their “Made in USA” claims do not meet FTC standards and may result in penalties if they continue without proper correction.
Some examples cited by the agency include:
- Products assembled in the U.S. using major foreign-made components
- Labels that implied full domestic manufacturing when only minor final touches occurred in the country
- Online and packaging materials that failed to disclose foreign parts
In some cases, companies were instructed to revise their marketing language or remove the claims entirely.
Civil Penalties Could Be Next
While the recent letters are warnings, the FTC made it clear that repeat offenses could lead to fines. Under the current law, the agency can issue penalties of up to $50,120 per violation.
“These letters are a wake-up call,” said FTC Chair Lina Khan. “If companies don’t fix misleading claims now, they could face costly enforcement actions in the future.”
Industry Response
Reactions from the business community have been mixed. Some praised the FTC’s efforts to keep branding honest, while others expressed concern about the complexity of global supply chains.
“We support truth in labeling,” said John Miller, spokesperson for the American Manufacturing Council. “But many companies use parts from multiple countries, and the rules need to reflect that reality.”
Others argue that smaller companies may not always be aware of the full supply chain, especially when parts are sourced through third parties.
However, consumer advocates say that this is no excuse. “If a company claims U.S. origin, it must be ready to prove it,” said Lisa Grant, policy analyst at Consumer Watchdog.
Steps for Businesses to Stay Compliant
To avoid penalties and bad publicity, the FTC urges companies to follow a few basic steps when using “Made in USA” claims:
- Review supply chain documentation carefully
- Consult legal counsel to understand what qualifies under FTC rules
- Avoid vague terms like “American-made” unless it meets the criteria
- Use more specific descriptions such as “Assembled in the USA with global parts” if full domestic origin cannot be claimed
The agency also offers a Made in USA Labeling Rule Compliance Guide on its website to help businesses understand their obligations.
Consumers Encouraged to Report Violations
In addition to enforcement efforts, the FTC is calling on consumers to report suspicious labels or marketing claims through the ReportFraud.ftc.gov platform.
This helps the agency track misleading practices and take action faster. By increasing consumer awareness, the FTC hopes to create a system where honest companies are rewarded, and deceptive ones are held accountable.
A New Era of Accountability
The FTC’s crackdown comes at a time when consumer trust is more important than ever. In a world of online shopping, global sourcing, and digital advertising, a single misleading label can cause major backlash and damage to a brand’s reputation.
By focusing on the ‘Made in USA’ label, the FTC is sending a strong message: truth in advertising is not optional. Whether a company is producing T-shirts, tools, or tech devices, honesty must be part of the brand promise.
Final Thoughts
The FTC’s latest move shows that regulators are paying close attention to product labeling—and companies should too.
As the market becomes more competitive and global, the value of trustworthy branding is rising. Businesses that get it right can build strong customer loyalty. Those that don’t, may find themselves under investigation, fined, or worse—publicly called out for deception.
With new enforcement power and a growing list of investigations, the FTC is proving it means business when it comes to “Made in USA” honesty.
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