US FTC takes action to crack down on fake reviews, merchants will be fined if they give positive reviews

According to news from this website on August 15, the US Federal Trade Commission (FTC) issued new regulations aimed at curbing the growing problem of fake reviews. The rule, which will become effective 60 days after publication in the Federal Register, explicitly prohibits the creation, purchase, or sale of fake reviews, and violators may face civil penalties.

FTC promulgates new regulations to combat false reviews

FTC Chairman Lina Khan said:

“False reviews not only waste consumers’ time and money, but also pollute the market environment and squeeze the living space of honest competitors. … The new regulations will strengthen the FTC’s toolbox to combat false advertising, protect consumers from deception, warn companies that use false means to make profits, and promote a fair, honest and competitive market environment.”

Main contents of the new regulations

• Fake Reviews Strictly Prohibited: The creation or dissemination of false reviews, whether generated by artificial intelligence or not, is prohibited. Reviews must reflect real personal experiences.
• No solicitation for reviews: Businesses may not offer rewards or incentives in any form in exchange for specific types of reviews.
• Disclosure required for insider reviews: Insiders must disclose their relationship with the company when writing reviews. Executives are not allowed to request comments.
• Company-controlled review sites need to be transparent: Companies must not mislead consumers into thinking that sites they control provide independent opinions.
• Protect Negative Reviews: Businesses are not allowed to delete, suppress, or falsely report negative reviews.
• Combating Fake Social Media Data: It is prohibited to buy or sell fake social media data to deceive consumers.

The FTC unanimously approved the regulation, which is expected to have a significant impact on fake reviews in online marketplaces and social media platforms. Violators may face civil penalties from the FTC.

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