FTC sents out warning letters to more than 700 companies over fake reviews
The Federal Trade Commission (FTC) has warned leading companies against the practices like procuring fake reviews and misleading endorsements. Companies caught mispresenting or deceiving customers will incur steep penalties, FTC said in its official address.
The US government agency on Wednesday (via BleepingComputer) sent out Notice of Penalty Offenses to more than 700 high-profile companies, with big names like Amazon, Apple, Google, and Walmart also on the list.
The FTC says the notice puts the companies on notice that they could incur civil penalties — up to $43,792 per violation — if they use endorsements in ways that run counter to prior FTC administrative cases.
“The rise of social media has blurred the line between authentic content and advertising, leading to an explosion in deceptive endorsements across the marketplace. Fake online reviews and other deceptive endorsements often tout products throughout the online world,” said the FTC in a press release.
FTC says it has determined the following practices to be unfair and deceptive:
- Falsely claiming an endorsement by a third party
- misrepresenting that an endorsement represents the experience, views, or opinions of users or purported users
- Making deceptive performance claims
- Failing to disclose an unexpected material connection with an endorser
- Misrepresenting that the experience of endorsers represents consumers’ typical or ordinary experience.
“FTC staff is not singling out your company or suggesting that you have engaged in deceptive or unfair conduct. We are widely distributing similar letters and the notice to large companies, top advertisers, leading retailers, top consumer product companies, and major advertising agencies,” said Serena Viswanathan, Associate Director, FTC, in the letter. You can read the sample letter here.
Among the companies that received Notice of Penalty Offenses include Adobe, Amazon, Apple, AT&T, BestBuy, Burger King, Chipotle, Dell, eBay, Expedia, Google, KFC, Macy’s, Microsoft, McDonald’s, PayPal, Tesla, Uber, UPS, Valve, Walgreen, Walmart, Wendy’, Yelp.