Business Blog
We’ll pay you to give our new rule a good review
Today the FTC issued a new rule striking against the persistent problem of fake and false consumer reviews and testimonials. Consumers should be able to trust the authenticity of feedback they read, hear, or see about a product or service. But digital content — including reviews and testimonials — has always been easy to fake, and with generative AI tools it’s now even easier. That makes our new rule even more significant.
Fake reviews and testimonials have polluted the marketplace. They harm the many consumers relying on them to pick products and providers, subverting people’s ability to make informed decisions. They also hurt competitors who work hard to comply with the law.
The FTC has challenged illegal practices regarding reviews and testimonials for several decades. Along with numerous law enforcement actions, we’ve also issued guidance to help businesses do the right thing. We’re not alone. Other regulators in the states and abroad have been trying hard to attack the problem. And whether protected from liability or not, online marketplaces and social media companies also have a crucial role to play, and they could and should do more to stem the tide of deceptive commercial conduct that they’ve allowed to fester on their platforms.
But altogether it has not been enough. That’s why, in 2022, we started the process for developing a new federal rule spelling out clearly deceptive practices in this area, authorizing courts to impose civil penalties for knowing violations, strengthening our enforcement actions, and imposing a deterrent effect on bad actors. The final Rule on the Use of Consumer Reviews and Testimonials reflects the great benefits of the public comment process. We heard a broad range of perspectives from consumers, small businesses, advocacy organizations, trade associations, review platform operators, researchers, and others with an interest in the area. As a result of their comments, we’ve made some clarifications and adjustments to the initially proposed version of the rule, which you can read all about in the lengthy statement accompanying the new rule.
Just as originally intended, the new rule remains focused on fighting clearly deceptive practices involving reviews and testimonials and not burdening honest businesses. Any deceptive or unfair practice involving reviews or testimonials which the rule does not cover is still subject to the FTC Act. The rule prohibits the following practices:
Writing, selling, or buying fake or false consumer reviews. The rule prohibits businesses from writing or selling consumer reviews that misrepresent they are by someone who doesn’t exist or who didn’t have actual experience with the business or its products or services, or that misrepresent the reviewers’ experience. It also prohibits businesses from buying consumer reviews that they knew or should have known made such a misrepresentation. Businesses are also prohibited from procuring from certain company insiders such reviews about the business or its products or services for posting on third-party sites, when the businesses knew or should have known about the misrepresentation. (The prohibitions on buying or procuring reviews don’t cover generalized review solicitations to past customers or simply hosting reviews on the business’s website. Neither will a retailer or other entity be liable for sharing consumer reviews unless it would have been liable for displaying those same reviews on its own website.)
Writing, selling, or disseminating fake or false testimonials. Businesses are similarly prohibited from writing or selling consumer or celebrity testimonials that make the same kinds of misrepresentations. They’re also prohibited from disseminating or causing the dissemination of such testimonials when they knew or should have known about the misrepresentation. (The prohibition on disseminating testimonials doesn’t cover the type of generalized solicitations to past customers discussed above with respect to reviews.)
Buying positive or negative reviews. Businesses are prohibited from providing compensation or other incentives contingent on the writing of consumer reviews expressing a particular sentiment, either positive or negative. Violations here include situations in which such a contingency is express or implied. So, for example, while it prohibits offering $25 for a 5-star review, it also prohibits offering $25 for a review “telling everyone how much you love our product.”
Failing to make disclosures about insider reviews and testimonials. The rule prohibits a company’s officers and managers from writing reviews or testimonials about the business or its products or services without clearly disclosing their relationship. Businesses are also prohibited from disseminating testimonials by company insiders without clear disclosures, if the businesses knew or should have known of the relationship. A similar prohibition exists for officer or manager solicitations of reviews from their immediate relatives or from employees or agents of the business, and when officers or managers ask employees or agents to seek such reviews from relatives. For these various solicitations, the rule is violated only if the solicitation results in reviews without disclosures and either (1) the officers or managers discouraged disclosures or didn’t give instructions about making clear disclosures, or (2) the officers or managers knew or should have known that such reviews appeared and failed to take steps to have those reviews either removed or amended to include clear disclosures. All of these prohibitions hinge on the undisclosed relationship being material to consumers. (These disclosure provisions also clarify that they don’t cover mere review hosting or generalized solicitations to past customers.)
Deceptively claiming that company-controlled review websites are independent. Businesses are prohibited from misrepresenting that websites or entities they control or operate are providing independent reviews or opinions, other than consumer reviews, about a category of businesses, products, or services that includes their own business, product, or service.
Illegally suppressing negative reviews. The rule prohibits using unfounded or groundless legal threats, physical threats, intimidation, or public false accusations (when the accusation is made with knowledge that it’s false or with reckless disregard as to its truth or falsity) to prevent the posting or cause the removal of all or part of a consumer review. Legal threats are “unfounded or groundless” if they’re unwarranted by existing law or based on allegations that have no evidentiary support. Also, if reviews on a marketer’s website have been suppressed based on their rating or negative sentiment, the rule prohibits that business from misrepresenting that the reviews on a portion of its website dedicated to receiving and displaying such reviews represent most or all submitted reviews.
Selling and buying fake social media indicators. The rule prohibits the sale or distribution of fake indicators of social media influence, like fake followers or views. A “fake” indicator means one generated by a bot, a hijacked account, or that otherwise does not reflect a real individual’s or entity’s activities or opinions. The rule also bars anyone from buying or procuring such fake indicators. These prohibitions are limited to situations in which the violator knew or should have known that the indicators were fake.
We mentioned generative AI earlier, and you may be thinking, to paraphrase Tina Turner, what’s AI got to do with it? The rule doesn’t specifically refer to AI, so do these prohibitions cover situations when someone uses an AI tool to generate the deceptive content at issue? Of course they do. To paraphrase ourselves, there’s no AI defense to the regulations on the books.
One last rhetorical question. Is this new rule going to sit on the proverbial bookshelf and collect dust? You better believe it won’t. The FTC will look to use it, when applicable, to go after those who employ these prohibited practices to hoodwink consumers and get an unfair leg up on their competitors. No honest business should be worried about the rule, as it only reflects what we believe is already illegal under Section 5 of the FTC Act. If you’re a dishonest business and don’t want to give our new rule five stars, that’s okay. We guarantee you won’t be getting a good review from us either.
This blog was updated on September 25, 2024 to correct the descriptions of Sections 465.5(c)(1) and 465.8(a) of the rule.
Darn, and here I thought after reading this I’d be paid for giving the FTC a good review! lol, kidding but not…
However, this is excellent and thank you. Consumers really want to know that they can buy with confidence!
I absolutely agree with The FTC. Analysis! I think you guys are GREEEAATT!
THANK YOU FROM THE HEART IN ALL YOU DO & REPRESENT CONSUMER PROTECTION, BUREAU OF PROTECTION & FTC. I AM SO GRATEFUL TO RECEIVE YOUR CONSUMER PROTECTION EMAILS THAT PROVE YOU ARE TRULY DOING YOUR JOB TO THE INTEREST OF ALL CONSUMERS IN AREAS THAT ARE MOST NEEDED & ONGOING.
In reply to THANK YOU FROM THE HEART IN… by ROSEMARY KINSELLA
I agree with you, Rosemary. I work in a public library and subscribe to FTC and CFPB emails to help keep the public aware of new scams. I wish I had known about all the hard work they do to protect us when my identity was stolen in August of 2018. Thank you Federal Trade Commission.
I'll give you 5 stars. I truely hope that the new rule will help. I despise fake information. I see it all the time on facebook. I really don't like all of the spam emails that I get as well. If those 2 problems could be fixed, that would be great.
Thank You
Excellent
Yes I like how this sounds. Especially thinking about tiktok and YouTube platforms where most of these street music creators are getting paid big bucks for not their talent but how many people views their content like subscribe and share , but they are getting people to make up or by fake accounts to achieve this paycheck which isn't fair economically because people really are works ng legitimately and not cheating the system do not see the same outcome as far as the pension just because the over flooding of fake likes, subscription shares or even comments. It's very sad that our people rather not enhance the economy but drain and weaken the very lining of how we can thrive and grow without the short cuts , which can lead into a life lesson on its own. "No Hard Work".. then no more free pay..
We needed this. The deception and lies were so misleading.
This is a great new rule to call out companies buying good, positive reviews.
Another useful new rule would be enforcement of existing rules. The courts order rules.
Online marketplaces are growing rapidly, and consumers increasingly rely on honest reviews from other customers to make informed decisions. Regulations that prevent fake reviews protect both businesses and consumers by ensuring fair competition and accurate product information
I truly hope you (FTC) do take action against those people or business who continue to violate, because I personally have lost a lot money like that, by all means go after those who might take (FTC) for granted.
👍
I give it a five star review, by cracking down on buying and selling fake social media and testimonies, alot of people just might not get taken for so much money. As I was reading this today, I stopped and researched to make sure this Rule was legitimate, which it was and I'm thrilled with it.
Assuming that social media influencers are subject to the “clear disclosures” provision, is the CLEAR aspect of this being enforced at all? Lots of obvious paid ads are being purposefully obfuscated by using the term “partner” instead of the “ad/advertisement/paid promotion.” There’s tiny text on the top or bottom (you have to be looking for it specifically to even notice, does that make it “clear”?) of a posted video or photo that says “XYZ Brand Partner.” To me, that’s not clear to the average social media user that this is a PAID contract in which the influencer is promoting that brand’s products.
The most egregious of these are the health/medical/skincare space, in which I see doctors and other licensed, credentialed professionals who definitely know better, promoting a certain product/brand, saying they fully endorse their products as a medical doctor (or whatever their health credential is)…and people are eating it up as if it came from THEIR doctor’s own mouth.
Please consider doing something to address this, these are medical professionals with hundreds of thousands or millions of followers, capitalizing on the average user’s naïveté for huge profits. “In Partnership with X Brand” does NOT make a “clear disclosure” of the commercial relationship between the influencer and the brand, in which they’re being paid to promote the brand’s products to millions, as “doctor approved.” It’s insane.
Ftc is a well needed part of our country.
Thank you for addressing the new rules on fake reviews, for they are long overdue. The majority of consumers rely on reviews when researching and making decisions on purchasing items. Imagine the disappointment that we, as consumers, when a highly rated item is received that doesn't halfway measure up to the number of great reviews given by so called buyers.
Excellent work. In this present age where AI is so competitive to the "real deal", we need all the help we can get. Thank you for this one!
This is a great thing and needs to be done. I've dealt with this in the past and it's very upsetting.
A great rule! VC Marc Andreeson thinks rechnology doesn't need rules. This is the reason we need them.
I have been solicited by 8 companies to do automated reviews of companies product and one of the companies did reviews on Amazon items.
This is hilarious, thank you all for the good work.
This is excellent new rule! I gave up reading reviews after reading one such company where almost every review used the same one word. A word that most people do not use. That was when I decided that reviews were written either by a company employee or AI.
Thank you for this new rule.
Ice Tea in the tv ads for CarShield warranties is an obvious target. I doubt he had any need for a CarShield warranty but this has been airing for some time and FTC does nothing.
I give the FTC 3 stars on the new rule. It's a good start, and I appreciate all of the effort that went into it, but you're letting the big players entirely off the hook. From your comments, Mr. Atleson, and those of Chair Lina Khan, you're obviously aware of the abject failures of third party review sites to take adequate measures to eliminate fraud on their platforms. Does Section 230 render the FTC entirely impotent? I would hope not. I eagerly look forward to your next step in this offensive against review fraud, a soon-to-be-released Notice of Proposed Rulemaking on the transparency requirements for review platforms such as Google, Yelp, and Facebook.
In reply to I give the FTC 3 stars on… by Kay Dean, Fake…
I agree 👍 is
FTC rules are always great
I would love to get paid to do what I do anyway.
How do we report?
In Minneapolis, TV advertisers use TV "Celebrities" to push products. Trying to earn trust under artificial means, which is fraud in my state. Just not prosecuted.
This same company manipulates and sells reviews on Facebook, Yelp and google reviews.
This problem is much worse than people expected and must be stopped!
Once these pushy sales people come to your door, its high pressure sale techniques, especially against the elderly. Minnesota State Attorney Generals Office is aware now.
Businesses, this well is now running out!
Great
At first glance, the rule seems a little long winded. As I read on, I appreciated the thoroughness of each issue being addressed. I am a consumer who reads reviews before spending my money or time. I also write reviews whether I've had a good or bad experience. I want honesty when I read and contribute reviews. I appreciate the fact that the FTC has stepped up to back up consumers who access reviews
I think this should not only be about product reviews, but about "customer feedback". We sell on a number of marketplaces, and often feedback is used as a bullying tool to get refunds, and sometimes results in sellers getting kicked off marketplaces because they make false allegations to get what they want.
I think that the new rule is great! Hopefully, this rule will help to eliminate false and fake news and information.
I think it's really good that they are going to do something about businesses making fake reviews. I'm fine with not getting paid for a review as long as they're stopping the fake reviews. Thank You for watching over the businesses that are actually being honest. I work hard for clients to give me a good review and it should be like that for all businesses.
On the other hand, business owners should be MORE protected against false and unfair reviews. These days, you can get a bad review just because you don't offer a certain service, or don't serve a certain area (where the information is clearly available on a website). I've had people threaten to leave my business bad reviews if I didn't comply with their demand, or timelime for certain requests. Reviews bombing (when several accounts or individuals get together to tank a rating) should also be banned. It has to be FAIR.
I wish you could figure out how to stop the unsolicited phone calls. I am on the donotcall list but still get 8 to 10 a day. I don't answer them but I know so many people do and I believe it is the start of many of the scams and hackers. My other thought is that we are almost forced to use the internet for products, however I do not feel Google does a thorough background check, if they do one at all, so false sights are created. I know you need to use https and to look for the locking but many elderly are not aware and quite unfamiliar with using computers. Thank you for all your efforts to keep us safe.
Great!! A. I. Writes ALOT of it too
That’s was the most informative information I’ve found on the internet thus far about how the FTC works and what it is!
I only leave replies if I truly think it will help whether it be poitive or negative. There are times when I'd like to rely on peoples comments, getting high discrepancies you wonder whos writing those reviews. I sure hope this helps. It would be great to read a review that is genuine. Love the animals, for food. Yes some make me laugh. Heres my vote for this new ruling! Thank goodness for all your hard work!!
I think this is a fantastic endeavor and must be done. I have direct experience with my home builder and I remain having problems with them, my home including the home warranty, upgrades, HVAC and heating system, the siding on my home, and the upgrades I paid up front for, which are not what they installed and I picked out. When I try to rate them on their website, they block my ability to do this because I assume it is not a 5 star rating. Additionally, they are blocking me on the internet so I am unable to rate them on other sites too, including our local BBB, which is another issue altogether. I assume they must be tracking me somehow online and blocking my ability to inform the public about my experiences with this Home Builder. I believe everyone has the right to know my experiences with this home builder and my complaints with them and how my complaint was handled with the BBB and that I continue to have problems with them, including the home warranty that they included with my home purchase was not even authorized to practice in the state of Texas. Overall, my complaints with them, the complaints I filed about them with the BBB and how they handled it was improperly handled and they failed to list, address and resolve all the issues that I told them or they misconstrued my complaints. I felt helpless when the mediator BBB provided was not trained or qualified to handle the issues I had and the mediator favored the home builder and failed to list all the issues I told them I had and the BBB failed to allocate the proper amount of time to mediate the case. I feel the entire handling of my complaints that I had with the homebuilder that I told the BBB about was handled poorly, inadequately and improperly. BBB failed to include all the issues, publish all the issues and so much more including addressing all my complaints and post that they existed. This home builder continues to thrive in the Houston area and build homes. This home builder has admitted that there are devices installed in my home that control the lighting and other undisclosed devices in the homes they build & that they are capable of many things including collecting personal and private information. I cannot get them to tell me what it is, where they have it installed in my home and how to remove it. This is unacceptable and I believe illegal and they need to be clear and transparent about what it is they have installed and how home owners can remove it. This home builder must be held accountable, repair the issues that were reported during the warranty period, install the upgraded products I paid for upfront and replace the appliances that they put in that have problems including the gas oven that leaks more gas that can be burned off. One burner has never worked and they did not repair. This is just a sample of the problems I have and have had and continue to have with them. There are so many more problems, including the Home Owners Association, communications and compliance. I believe the public has the right to know my experiences and problems and I am unable to post them or rate this home-builder anywhere online. I hope this gets posted.
It’s about time. Several influencers are scamming companies by buying followers for years. It’s time to cut it off. Go straight to the companies that are selling the bot services and get their client lists. Start slashing fake accounts. So many fake reviews. It’s infuriating that people make money off of scamming and I has been legal!! Crazy.
How does this affect individuals who have never purchased a product, used a product or experienced a service from a business that leave reviews NOT solicited by the business. Reviews left by disgruntled employees, or ex significant others, or just random people who leave reviews just for the fun of it? Will there be consequences for them as well?
This sounds promising and very helpful. However, I see so many fake reviews supporting products from a certain overseas country that I wonder how this will help when they are located overseas and already don’t respect any of our laws. The CCP won’t be helping our FTC.
"...misrepresentations of a person’s or company’s influence or importance for a commercial purpose"
Will clarification be provided about this clause?
Does this mean that the FTC can also go after any influencer that purposely or should have known they obtained fake follower(s) at any time in the past to boost their personal brand, but then later use their brand equity for commercial purpose(s) such as promoting/advertising brand(s) they actually use?
I truly hope it will help out and appreciate all the hard work you put into it and do for us
ABOUT DANG TIME... Lets see if they actual do something about the dental and health industry buying & incentivizing reviews. Recently the FTC and dental associations have been allowing dentist to get away with this.
I was fooled big time by a dental office that was incentivizing there reviews and I didn't know until realizing the dentist couldn't do the task they signed up for and wasn't willing to back any of there work. I paid over $50,000 out of pocket for a full mouth restoration through Grandville Dental Health Center PC and after 1 month a bridge became loose, a crown became loose, a veneer fell off, and another veneer chipped and the dentist won't fix anything or pay for it to get fixed. I believe It's because I paid cash. If I had dental insurance the insurance company would make them fix it.
I though I was going to a 5 star dentist but in all actuality was just a bunch of unethical incentivized reviews, the dental office I went to was giving a lots of entries to win TVs if you left a review. The dental association(s) should step up & start sanctioning and fining these dentist with fees. It's unfair for consumers trying to find a legit health provider and it's also unfair to the hard working competitors in the industry.
About time!! Lenovo computers should be at top of this list for continuing to sell and promote their defective plastic laptop hinges that. Cause the screen to fall off from opening and closing your laptop just after their warranty ends.
I own a house cleaning business and on google reviews I have two 1 star reviews for not showing up at all or arriving late. Both are fake. But I am constantly getting emails from companies wanting me to pay them to write me enough 5-star reviews that it will push the two bad ones I have so far to the back they will never be seen.
I forward those to google but they don't seem to care because I still get those emails from the same people. So knowing this when you do look at reviews dont just read the front top and back go to the middle also. Thats where the bad ones are hidden. Most sites have a scale and you can choose to see 1,2,3,4, star etc... but for those sites that don't be sure to go to the middle pages and see what's hidden.
This article provides a clear explanation of the FTC's stance on incentivized reviews. It's essential reading for businesses today!
great, how do we report abuse and violations of these rules?
In reply to great, how do we report… by Scott Wheeler
Report scams, fraud, and bad business practices to the FTC at www.ReportFraud.ftc.gov.