Fake review writers are officially on watch - the US is now enforcing a new rule to ban the practice and is promising a crackdown.
"As of today, @FTC's final rule banning fake online reviews and testimonials has come into effect," the head of the agency Lina Khan wrote on X (formerly Twitter). "If you encounter any of these prohibited practices, you can report them to @FTC at: https://reportfraud.ftc.gov."
The rules, introduced in August after a lengthy consultation process, could upend what has been a very profitable business for some reviewers. The FTC is threatening to fine such scammers, and the sites and businesses that promote them, up to $50,120 per violation. The illegal acts include:
- Fake reviews - from individuals, celebrities, or AI - must come from someone who has actual experience with the product or service. Businesses are liable if they purchase or promote reviews from individuals who either do not exist, did not use the product, or misrepresented their experience.
- Companies will also be on the hook for a fine if they knowingly purchase a good review, or a bad one of a competitor's product or service.
- Reviews by staff are also forbidden unless the reviewer discloses their relationship with the supplier. This also includes roping in friends or family to post reviews.
- Corporate review farms are on the no-go list, websites that claim to be independent but which feature the owner's own products.
- Anyone is trying to get a review taken down "using unjustified legal threats, other intimidation, or false accusations to prevent or remove a negative consumer review."
- Buying fake social media endorsements will also arouse ire. Businesses are prohibited from purchasing fake indicators of influence — such as followers or views — if used to mislead others about their commercial significance.
Fake reviews abound on the internet, and for some websites and even individuals, they can be very profitable. But a 2022 study [PDF] cited by the FTC warns that such fakery cost consumers 12 cents for every dollar spent, not to mention a lot of disappointed buyers.
While some rules against such deceptive practices are in place, they require a regulator that's serious about using them. Under Khan, the agency has actually started enforcing the law and - in the case of fake reviews - this has already resulted in a penalty.
- Uncle Sam cracks down on faked reviews and bad influencers
- FTC drops hammer on unwanted subscriptions with 'click to cancel' rule
- FTC sues five AI outfits – and one case in particular raises questions
- No way? Big Tech's 'lucrative surveillance' of everyone is terrible for privacy, freedom
In 2023, the FTC launched an action against The Bountiful Company, accusing it of using a deceptive practice called "review hijacking" on Amazon, in which a marketer steals or repurposes reviews of another product. In a settlement, the company agreed to pay a penalty.
“Boosting your products by hijacking another product’s ratings or reviews is a relatively new tactic, but is still plain old false advertising,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection. “The Bountiful Company is paying back $600,000 for manipulating product pages and deceiving consumers.”
Even some previously respectable review sites have fallen into the practice and, if caught, can expect to get a knock on the door from investigators. Amazon too might want to take the culling of fake reviews from its site a little more seriously, as should those looking to deploy AI to boost their profiles. ®