By Valeria Nikitina / Unsplash+The final ruling from an FTC decision made in August that will combat fake reviews and testimonials by prohibiting their sale or purchase entered into effect today.
During a proposal and comment period lasting from November 2023 to June 2024, the FTC found that the ruling had broad support.
FTC Chair Lina Khan stated that fake reviews are a nasty diversion away from honest business towards nefarious suppliers and sellers who waste people’s time and money.
“By strengthening the FTC’s toolkit to fight deceptive advertising, the final rule will protect Americans from getting cheated, put businesses that unlawfully game the system on notice, and promote markets that are fair, honest, and competitive,” said the chairwoman in a statement.
The final rule in exact wording addresses reviews and testimonials that misrepresent that they are by someone actually exists, but in fact, does not. This would include AI-generated fake reviews, those who did not have actual experience with the business or its products or services, or that misrepresent the experience of the person giving it.
It prohibits businesses from creating or selling such reviews or testimonials. It also prohibits them from buying such reviews, procuring them from company insiders, or disseminating such testimonials when the business knew or should have known that the reviews or testimonials were fake or false.
With an exception for clear and honestly conveyed messaging, the ruling prohibits businesses from providing compensation or other incentives conditioned on the writing of consumer reviews expressing a particular sentiment, either positive or negative.
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It also prohibits certain reviews and testimonials written by company insiders that fail to clearly and conspicuously disclose the reviewer’s material connection to the business.
The ruling also took into account how a business or service might dishonestly try to control or obscure unwanted reviews.
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As such, it prohibits businesses from using unfounded or groundless legal threats, physical threats, intimidation, or certain false public accusations to prevent or remove a negative consumer review, and from misrepresenting that the reviews on its website represent all or most of the reviews submitted when reviews have been suppressed based upon their low ratings or negative sentiment.
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