US FTC targets fake reviews, companies face fines
Companies buying or selling fake reviews now face fines under a new FTC regulation.
The US Federal Trade Commission (FTC) has finalised a rule prohibiting companies from buying or selling fake online reviews. New regulation allows the FTC to impose fines of up to $51,744 per violation, targeting deceptive practices that harm consumers and distort competition.
The rule addresses various forms of manipulation, including fake reviews from non-existent customers, company insiders, or AI. It also bans purchasing fabricated views or followers on social media and using intimidation to remove negative reviews. While the rule does not require platforms to verify consumer reviews, it represents a significant step towards a more honest online marketplace.
Trade groups and businesses like Google, Amazon, and Yelp have supported the rule. Yelp’s General Counsel, Aaron Schur, stated that enforcing the rule would improve the review landscape and promote fair competition among businesses.
Consumer advocates, such as Teresa Murray from the US Public Interest Research Group, praised the rule as essential protection for online shoppers. The hope is that the fear of penalties will encourage companies to adhere to ethical practices, benefiting both consumers and businesses.
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