U.S. Consumer Product Safety Commission

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Views expressed in this presentation are those of the staff and do not necessarily represent the views of the

Commission

Advanced Compliance Course

Saint Louis University April 23, 2014

Today’s Agenda Being Prepared Working with the CPSC Staff Field Investigator Visits

Consumers Retailers Manufacturers

Recall Effectiveness Recall Monitoring Monitoring Internet Sales Safe &Adequate Disposal of Recalled

Products2

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Being Prepared Recall Handbook – Section 15 –

Defects March 2012 Home/Business & Manufacturing/Recall

Guidance Regulated Products Handbook

May 2013 Home/Business & Manufacturing/Recall

Guidance Handbook For Manufacturing Safer

Consumer Products July 2006 Products

Voluntary Standards Home/Regulations, Law & Standards

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Being Prepared - Continued

Have internal controls and procedures in place to routinely review and capture data Update these frequently

Disclose required information to Regulators

Provide employees with training written standards and policies

Document everything in writing and make it available upon request

compliance training mechanism to report issues

Empower employees to disclose weaknesses to Executives

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Being Prepared - Continued

Know how to Handle Returns from distribution chain

Parts orders Consumer complaints, claims, lawsuits online product reviews Product life testing Quality assurance/ product improvement Material changes Retailer reports/ feedback Incidents from CPSC saferproducts.gov

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Code of Federal Regulations

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The C.F.R. is available at:

http://www.cpsc.gov/en/Regulations-Laws--Standards/Regulations-Mandatory-Standards--Bans/Regulated-Products/

What Prompts a CPSC Visit?

News Report

Follow-up to an in-depth investigation

Potentially hazardous product was identified but responsible firm is not clear.

Manufacturer, importer or retailer of possibly defective product was identified and additional information is needed to determine whether substantial product hazard exists.

Ongoing voluntary and regulated product standards compliance monitoring

Source Data

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• Hot Line reports

• Public Data base

• Civic groups

• Attorneys

• Retailers

• State death certificates

• MECAPS reports

• Consumers

• Internet surveillance

• Medical professionals

• CPSC Field Investigations

• Newspapers, radio, television, Internet, trade blogs, etc.

• Fire & police reports, Non-MECAP coroners, hospitals

Inspections

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“There’s a CPSC Investigator Here to See

You…” Inspections are not

usually scheduled in advance.

The investigator will ask to meet with an officer of the corporation or the most responsible person on the premises.

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Section 16(a) of the CPSAGrants CPSC investigators the right, upon presenting appropriate credentials and a written notice from the Commission to the owner, operator, or agent in charge, to enter and inspect, at reasonable times and in a reasonable manner:

(A) any factory, warehouse, or establishment in which consumer products are manufactured or held, in connection with distribution in commerce,

(B) any firewalled conformity assessment bodies accredited under section 14(f)(2)(D), or

(C) any conveyance being used to transport consumer products in connection with distribution in commerce.

How Does the Inspection Begin?

The investigator will present his/her credentials.

A “Notice of Inspection” will be issued.

The reason for the visit will be discussed.

What Must the Firm Provide?

Section 16(b) of the CPSA

All records, reports, books, documents, papers or labeling which show or relate to the production, inventory, testing, distribution, sale, transportation, importation, or receipt of any product or component thereof

Samples of the product

What Can the Investigator Ask to See?

Any factory area, warehouse area, or office area in which consumer products are manufactured or held in connection with distribution into commerce, or any area where documentation is held which is needed to complete the inspection.

The Following Information may be Reviewed

Trade/Brand names of products Complaint history for product(s) in

question Details of quality control and testing

programs Information regarding sources-

suppliers of sub-components Product coding system description Business Structure Product design history Sales records

Will the Investigator do any Testing?

The investigator may test random samples if the testing equipment is portable and available. Such testing may include XRF screening for lead, small parts testing and/or other product specific examination deemed appropriate.

Collection of Samples CPSC’s inspectional authority allows

for the collection of samples, component parts, materials, substances, products, containers, packaging and labeling.

Samples will be collected by the investigator personally, at random from the firm’s inventory.

Multiple units are usually collected to ensure enough units are available for adequate testing.

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Penalties for Non-Compliance with an

Inspection

Sections 19(a)(3) of the CPSA and 4(e) of the FHSA: It is unlawful for any person to fail or refuse to permit access to or copying of records . . . . or fail or refuse to permit entry or inspection.

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Penalties for Non-Compliance with an

Inspection Section 19(a)(3) of the CPSA: It is unlawful for any person to fail or refuse to permit access to or copying of records, or fail or refuse to establish or maintain records, or fail or refuse to make reports or provide information, or fail or refuse to permit entry or inspection.

18 U.S.C. Section 1001: (criminal statute) (1) falsifies, conceals, or covers up by any trick, scheme, or device, a material fact;

(2) makes any materially false, fictitious, or fraudulent statement or representation; or

(3) makes or uses any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry

Can You Prepare for an Inspection?

If you are a manufacturer, retailer, or reseller of consumer products, know what rules apply to your business. Being informed is being empowered.

CPSC wants your business to succeed and your customers to be safe. We are a resource to educate you on the steps your business should take to comply with our safety rules.

Review our Business & Manufacturing guidance on CPSC.gov, watch our special presentations for industry from CPSC technical and compliance staff.

Maintain good records. Document the history of products from initial design to current QC reviews. Implement a first-class quality control system to ensure you meet U.S. consumer product safety requirements.

Investigations

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How does the CPSC Compliance Investigation

process work?

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Field investigation conducted Compliance initiates contact with

the firm Epidemiology conducts data

search Engineering performs testing

(both failure mode and performance testing)

Preliminary Determination made (for non- Fast-Track cases)

Negotiate recall Notification to consumers

Reporting Obligations Section 15 of the CPSA

The manufacturer, importer, distributor, or retailer is required to report immediately upon obtaining information which reasonably supports the conclusion that a product:Fails to meet a rule, regulation, standard,

or ban under the CPSA or any other statute enforced by the CPSC;

Contains a defect which could create a substantial product hazard to consumers; or

Creates an unreasonable risk of serious injury or death. 24

Reporting under Section 15(b) Covers both Fast Track and non-Fast Track We encourage reporting under Section 15 on

our website or via e-mail to the Section 15 mailbox. Faster, easier to track and routeAdd photos and other documents

On our website at: www.cpsc.gov On right hand side under “Businesses”

Or via email to: Section15@cpsc.gov We discourage reporting via phone, mailed

letter, or fax.Much slower, harder to track, and much

easier to get lost or duplicated during routing

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Why Not Report?

Not all Section15(b) reports result in recalls.

Approximately 40% of the Section15 reports received, result in no action by the staff. 

Where the staff initiates its own investigation, the likelihood of eventual recall increases. Don’t wait for us to call you – you

should be calling us first!

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Staff Initiated Cases with and without PDs and CAPs

FY09 FY10 FY11 FY12 FY13 FY14

0

20

40

60

80

100

120

59

88 87

120

57

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Staff Initiated Cases with PD and CAP

FY09 FY10 FY11 FY12 FY13 FY14

0

5

10

15

20

25

30

35

40

1618

23

26

40

2

Staff Initiated Cases No PD or CAP

FY09 FY10 FY11 FY12 FY13 FY14 as of 2/12

0

20

40

60

80

100

120

140

5988 87

120

57

10

16

18 23

26

40

2

75

106 110

146

97

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All Staff Initiated Cases*by origin date

With PD and CAP No PD or CAP

21%

79%

17%

83%

21%

79%

18%

82%

41%

59%

16%84%

97%3%

Firm Reported Cases with and without PDs and CAPs

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FY09 FY10 FY11 FY12 FY13 FY14

0

50

100

150

200

250

300

350

343

315289 297

103

2

Firm Reports with PD and CAP

FY09 FY10 FY11 FY12 FY13 FY14

0

50

100

150

200

250

167 163147

204 202

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Firm Reports with No PD or CAP

FY09 FY10 FY11 FY12 FY13 FY14 as of 2/12

0

100

200

300

400

500

343 315 289 297

103

2

167163

147204

202

65

510478

436

501

305

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All Firm Reported Cases*by origin date

With PD and CAP No PD or CAP

Cases and Reports with and without PDs and CAPs

FY09 FY10 FY11 FY12 FY13 FY14 as of 2/12

0

100

200

300

400

500

600

700

69% 69% 69% 64%

40%

16%

31% 31%31%

36%

60%

84%

585 584546

647

402

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ALL PD and CAP Cases No PD or CAP cases

Voluntary Recalls by Fiscal Year

FY10 FY11 FY12 FY13 FY14 as of 1/30

0

50

100

150

200

250

300

350

400

450

500

414 378 412345

96

62

3032

28

6

476

408444

373

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Defect Regulated

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Field Investigator CAP Inspections

Corrective action is not over when recall is announced

Investigator will likely be visiting to review recall progress

Report any changes to the corrective action plan agreement

Have all possible distributors and customers been notified? How/ When? Review documentation. Should a second effort to contact customers be done? Should other means of notification be considered?

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CAP Inspections - Continued

Are there final numbers regarding the number of units involved? Additional models? Should the recall be expanded due to new information received due to publicity?

Examination and rough inventory of units already under firm’s control and not distributed. Properly segregated?

Reverse logistics: How are returned units being tracked? Proof of consumer destruction documented? Where are they being stored? Segregated from new units?

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CAP Inspections - Continued Have you been submitting required monthly

reports?

Records? Who is responsible for overall tracking? Have you taken steps to prevent previously returned recalled units from being sold?

Have you worked out a repair verification procedure? How will consumers/ retailers/ investigators know that future stock in store does not include non-refurbished/ old units that were recalled?

How many units have been returned/ corrected to-date? By what measure will you be satisfied?

Are products quarantined?

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When is a Recall Effective?

The purpose of the recall is to alert the public, and specifically the purchasers of the product, that the product may pose a hazard and what action should be taken

Comprehensive and continuing efforts must be made to reach all relevant consumers as quickly as possible

Some recalls have different success rates than others. Why? What creative methods have you used to reach your customers? 36

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Witness Reconditioning and Destruction

Product Disposal

Know if you will need special disposal for items like batteries or electronics (federal, state, or local laws.)

If retailers will be disposing or destroying the product or if you are using a 3rd party, we need to know.

Before you destroy, dispose, or recycle recalled products notify CPSC staff via e-mail to recallproductdisposal@cpsc.gov

Field staff may witness destruction/disposal/recycling or require an affidavit to verify process.

Notify us of plan as early as possible. 38

CPSC Will Also Monitor Monthly progress reports – focus on

post-recall injuries Conduct Recall Verification

Inspection at recalling company Execute recall checks at points of

sale conducted by CPSC and/or State Investigators

Internet Surveillance Unit identifies sale of recalled products reported to websafety@cpsc.gov and through other sources

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FOR FURTHER INFORMATION:

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sect15@cpsc.gov

recalledproductdisposal@cpsc.gov

www.websafety@cpsc.gov

www.cpsc.gov

www.saferproducts.gov

Marc Schoem301-504-7520

mschoem@cpsc.gov

Dennis Blasius262-650-1216

dblasius@cpsc.gov