FTC Declines to Investigate Controversial Walmart Wage Ad

NAD Referred Matter to Feds After Walmart Refused to Participate in Review

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The Federal Trade Commission has declined to act on a referral from the National Advertising Division of the Council of Better Business Bureaus of a Walmart ad the NAD said was potentially misleading about the retailer's wages.

The NAD referred the issue to the FTC after Walmart refused to participate in the industry self-regulatory process. In deciding not to take action, the FTC considered "resource allocation and enforcement priorities" as well as "the nature of any FTC act violation and the type and severity of any consumer injury," according to a letter from Mary Engle, associate director for advertising practices.

NAD spokeswoman Linda Bean said the FTC sometimes declines to investigate a matter after informally talking with an advertiser and getting assurance that the ad in question won't run anymore or will be modified. But she added she didn't know if that was the case here.

A search on iSpot.tv shows the ad in question last ran on Sept. 3, the day before Ms. Engle's letter was written. The bulk of the ad's more than 6,000 airings, backed by more than $13 million in estimated spending, according to iSpot, came from May through late July, stopping soon after the NAD made its referral to the FTC, though the ad then aired nine more times in August and September just prior to Labor Day.

But Walmart spokesman Kory Lundberg said Walmart had agreed neither to modify or stop running the ad, and an unedited version of it remains posted on Walmart's YouTube channel.

NAD Director Andrea Levine initiated the group's review of the ad in July over questions of whether it may falsely imply that Walmart is paying its workers "a living wage" and a minimum of $15 an hour. The retailer has pledged to raise minimum pay for its workers to $10 an hour.