The FTC’s fake review crackdown begins this fall
Image: Cath Virginia / The Verge
The Federal Trade Commission has announced a final rule banning companies from creating or selling fake reviews, including AI-generated ones. Once it goes into effect, the FTC can take action against companies that violate the policy.
The new rule could help address AI-generated reviews that pop up on sites across the web, including Amazon. Here are the types of deceptive practices the FTC’s new rule prohibits:
Offering incentives to customers in exchange for writing positive or negative feedback.
Reviews and testimonials written by “insiders” at a company who fail to “clearly and conspicuously” disclose their affiliation with the business.
Company-controlled review websites, which often advertise themselves as providing independent opinions on products they actually own.
Threatening or intimidating customers into removing negative reviews.
Buying or selling fake followers or views on social media.
The FTC first proposed a ban on fake reviews last year. However, it’s still not clear how the agency will enforce this rule on global marketplaces like Amazon, where many businesses that post fake reviews are located outside the US. Amazon has long struggled with fake reviews on the platform and has attempted to use AI to detect inauthentic feedback. In 2022, Amazon took action against the admins of thousands of Facebook groups selling fake product reviews, while the FTC also fined an Amazon seller for “review hijacking” last year.
3. Thanks to the rule, @FTC will be able to more effectively combat fake reviews by levying penalties on lawbreakers and returning money to those harmed.As @POTUS notes, Americans should be able to trust online reviews when looking to buy a product.https://t.co/0TeG5I6ika— Lina Khan (@linakhanFTC) August 14, 2024
“Fake reviews not only waste people’s time and money, but also pollute the marketplace and divert business away from honest competitors,” FTC Chair Lina Khan says in the announcement. “The final rule will protect Americans from getting cheated, put businesses that unlawfully game the system on notice, and promote markets that are fair, honest, and competitive.”
The FTC’s finalized rule, which was approved with a 5–0 vote, will go into effect 60 days after it’s published in the federal register. Under the rule, the FTC can seek a maximum of up to $51,744 per violation.
Image: Cath Virginia / The Verge
The Federal Trade Commission has announced a final rule banning companies from creating or selling fake reviews, including AI-generated ones. Once it goes into effect, the FTC can take action against companies that violate the policy.
The new rule could help address AI-generated reviews that pop up on sites across the web, including Amazon. Here are the types of deceptive practices the FTC’s new rule prohibits:
Offering incentives to customers in exchange for writing positive or negative feedback.
Reviews and testimonials written by “insiders” at a company who fail to “clearly and conspicuously” disclose their affiliation with the business.
Company-controlled review websites, which often advertise themselves as providing independent opinions on products they actually own.
Threatening or intimidating customers into removing negative reviews.
Buying or selling fake followers or views on social media.
The FTC first proposed a ban on fake reviews last year. However, it’s still not clear how the agency will enforce this rule on global marketplaces like Amazon, where many businesses that post fake reviews are located outside the US. Amazon has long struggled with fake reviews on the platform and has attempted to use AI to detect inauthentic feedback. In 2022, Amazon took action against the admins of thousands of Facebook groups selling fake product reviews, while the FTC also fined an Amazon seller for “review hijacking” last year.
3. Thanks to the rule, @FTC will be able to more effectively combat fake reviews by levying penalties on lawbreakers and returning money to those harmed.
As @POTUS notes, Americans should be able to trust online reviews when looking to buy a product.https://t.co/0TeG5I6ika
— Lina Khan (@linakhanFTC) August 14, 2024
“Fake reviews not only waste people’s time and money, but also pollute the marketplace and divert business away from honest competitors,” FTC Chair Lina Khan says in the announcement. “The final rule will protect Americans from getting cheated, put businesses that unlawfully game the system on notice, and promote markets that are fair, honest, and competitive.”
The FTC’s finalized rule, which was approved with a 5–0 vote, will go into effect 60 days after it’s published in the federal register. Under the rule, the FTC can seek a maximum of up to $51,744 per violation.