The Federal Trade Commission (FTC) has issued warning letters to 10 companies regarding possible breaches of the agency’s Consumer Review Rule. The rule aims to prevent deceptive or unfair practices related to product reviews used in advertising and marketing.
Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection, said, “Fake or false consumer reviews are detrimental to consumers’ ability to make accurate and informed choices about the products they are buying – something of particular importance during the holiday season. As consumers increasingly depend on online reviews, the FTC is committed to ensuring companies comply with this Rule.”
The Consumer Review Rule bans reviews and testimonials that misrepresent whether a reviewer had a positive or negative experience, or whether they actually used the product or service. It also prohibits businesses from offering compensation or incentives in exchange for specific sentiments in reviews, as well as failing to disclose when reviews come from company insiders or their immediate relatives. Other provisions address company-controlled review websites, suppressing certain types of reviews, and misuse of social media influence indicators such as follower counts or views.
According to the FTC, these warning letters were sent based on consumer complaints and information provided by the companies themselves. The letters do not constitute formal findings that any violations have occurred but serve as reminders of legal obligations under the rule. The recipients were cautioned that violations could lead to federal lawsuits or other enforcement actions, with civil penalties reaching up to $53,088 per violation.
The FTC continues its work promoting competition and protecting consumers through education and enforcement efforts. The agency advises that it will never demand money, make threats, request money transfers, or promise prizes. More information for consumers is available at consumer.ftc.gov and fraud can be reported at ReportFraud.ftc.gov.
