(RightIsRight.co) – Targeting deceptive online schemes meant to trick consumers, the Federal Trade Commission has announced a major new rule to combat fake reviews and misleading marketing practices.
According to a source, the FTC voted 5-0 to finalize the rule, which will be enforced 60 days after its publication in the Federal Register.
The rule focuses on various deceptive practices, including AI-generated reviews, censorship of honest negative reviews, and paying for positive reviews.
This decision addresses the ongoing issue of unreliable online reviews, especially on sites like Amazon, where fake and paid reviews have been a big problem.
In 2020, Amazon claimed to have shut down over 200 million fake reviews. Yelp also reported more than 950 cases of “deceptive review practices” on other online platforms in 2021.
Moreover, the rise of AI has made it easier to create fake reviews, which has worsened the problem. The FTC’s new rule aims to combat this and make online reviews more trustworthy.
The rule bans businesses from using fake or misleading reviews, including those generated by AI or from people who have not used the actual product. It also prohibits buying or selling reviews, whether they’re positive or negative.
Employees who write reviews must disclose their connection to the business, and company officers or managers cannot give testimonials or ask employees to get reviews from family members.
Additionally, the rule bans review sites controlled by companies that claim to be independent.
It also prohibits using legal threats or intimidation to remove or prevent negative reviews. Businesses cannot misrepresent their review section as comprehensive if they’re suppressing negative feedback.
The rule also covers fake engagement on social media, such as followers, likes, or views gained through bots or hacked accounts.
The maximum fine for violating the rule is $51,744 per incident, though courts may impose lower penalties depending on the case.
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