FTC Barred From Some Restitution Claims by Appeals Court (2)

The Federal Trade Commission cannot pursue restitution from fraudsters when it moves to halt their operations, a federal appeals court said in a decision overturning existing circuit precedent and setting up a split with other circuits.

The FTC can’t obtain a $5 million restitution order against a fraudulent credit monitoring company because the agency used a provision in its governing statute that does not explicitly allow for restitution orders, a three-judge U.S. Court of Appeals for the Seventh Circuit said Aug. 21.

The restitution order, which was approved by a lower court judge, is not specifically allowed for under the ...