The FTC has taken a major step in fighting fake reviews and deceptive marketing practices, announcing new rules targeting fake online reviews designed to trick consumers.
TechCrunch Reports By a unanimous vote of 5-0, the FTC finalized rules aimed at addressing various types of fake reviews and prohibiting marketers from engaging in deceptive practices. The new rules, which are set to go into effect 60 days after publication in the Federal Register, target practices such as AI-generated reviews, censorship of honest negative reviews, and compensation to third parties for positive reviews.
The decision comes in response to the long-standing challenge of unreliable online reviews, where merchants have made widespread use of fake and paid reviews, particularly on platforms like Amazon, which claims to have removed more than 200 million fake reviews in 2020 alone. Yelp, another popular review platform, reported more than 950 instances of “deceptive review practices” on other online platforms in 2021.
The rise of generative AI has made the problem even worse by making it easier for bad actors to create fake reviews. The FTC’s new rules aim to address this growing concern and improve the trustworthiness of online reviews.
The new rules prohibit companies from using fake or dishonest reviews, such as AI-generated reviews or reviews written by individuals with no actual experience of the product. The rules also prohibit the buying and selling of reviews, whether negative or positive. Company insiders who write reviews must clearly disclose their ties to the company, and executives and managers are not allowed to write testimonials or ask employees to write reviews from relatives.
Additionally, the rules prohibit company-controlled review websites that claim to be independent and prohibit the use of legal threats, physical threats, or intimidation to force the removal or prevention of negative reviews. Companies are also prohibited from falsely representing that the reviews portion of their website accounts for all or most of the reviews when suppressing negative reviews.
The rule also applies to fake engagement, such as social media followers, likes, and views gained through bots or hacked accounts. The maximum civil penalty for fake reviews is set at $51,744 per violation, although courts may impose lower penalties depending on the specific case.
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Lucas Nolan is a reporter for Breitbart News covering free speech and online censorship.
