The US Federal Trade Commission (FTC) is done playing games with those who leave fake reviews online. The skeptical comments on the products/services purchased can mar the reputation of a business in the long run.
To give some peace of mind to the entrepreneurs and avoid such issues, the agency is looking forward to punishing those organizations who participate in "secretly manipulating " the reviews.
FTC's Battle Against Fake Online Review Purveyors
(Photo: Devin Avery from Unsplash)
FTC ban on fake reviews
The development of this rule has been a long and meticulous process, as is customary for federal regulatory agencies. The FTC's first encounter with fake reviews dates back to 2019 when they took legal action against a merchant who was found guilty of making false claims and paying for fabricated reviews, according to TechCrunch.
The agency has also addressed the issue of undisclosed "influencer marketing," where individuals were promoting products without disclosing their financial ties.
After extensive research and consultations with businesses, consumers, and advertising trade organizations, the FTC has now unveiled a near-final form of the proposed rule. While some trade organizations have expressed concerns about the rule being burdensome and lacking evidence of prevalence, consumer advocacy organizations, major online companies, and common sense prevail.
The sheer number of fake reviews taken down, which now amount to billions, and the compromised nature of the review system on platforms like Amazon, attest to the urgency of the situation. The FTC also recognizes the potential for even more deceptive practices with the emergence of generative AI technology, making it easier for malicious actors to create fake reviews.
Related Article: FTC Now Has an Office of Technology to Regulate Fast-Moving Tech World
FTC Proposes New Set of Rules to Ban Fake Reviews
Despite the varying viewpoints, the FTC has meticulously crafted the proposed rules to ensure that legitimate commerce and acceptable review practices are not affected.
The rules target specific actions that are detrimental to the authenticity of reviews. These actions include selling or soliciting fake reviews, manipulating reviews by transferring them between products, purchasing positive or negative reviews, posting undisclosed reviews from company leadership or related individuals, running review sites that falsely claim independence, suppressing reviews through legal threats or intimidation, and selling fake engagement metrics like followers and video views.
FTC is allowing the public to take part in its proposed ruling to ban fake online reviews. The adjustments will be made after 60 days.
Once finalized, the rule will be put to a vote, solidifying its significance in safeguarding consumers from deceptive practices while supporting genuine feedback and honest commerce.
Back in April, FTC slapped supplement manufacturer The Bountiful Company with a $600,000 fine for hijacking reviews on Amazon. This was the first time that FTC fined a company for doing such illicit activity.
