FTC bans fake reviews. Sorry, scammers.

The FTC has finalized its fake review ban, which covers many of the sneaky review shenanigans that have plagued e-commerce sites for years, as well as shady social media practices like buying fake followers. 

The final rule will go into effect in a few months, and it places steep maximum civil penalties of up to $51,744 per violation. 

“Fake reviews not only waste people’s time and money, but also pollute the marketplace and divert business away from honest competitors,” said FTC Chair Lina Khan in a press release. 

The FTC rules strike at the heart of a shadowy industry that seeks to game and manipulate e-commerce and social media platforms for profit. Public trust in online reviews has been damaged by the extensive use of these practices, which have persisted for years despite extensive scrutiny. 

According to the FTC's announcement of the final rule, here are the kinds of manipulation that are now banned:

• Fake consumer reviews of any kind, such as AI generated reviews, the use of fake reviewers, and anyone who didn't actually have any experience with the product. Testimonials featuring celebrities who have no experience with the product are also banned.   

• Companies can't buy or incentivize positive or negative reviews. This includes the common practice on e-commerce marketplaces where free or steeply discounted goods are offered in exchange for positive reviews. 

• Company insiders aren't allowed to write reviews about their own products that fail to disclose their connection to the company, and they are also not allowed to force employees to do the same. In a blow to small pizza shops everywhere, this even includes preventing company owners from asking family members to write reviews on behalf of their business.

• Companies can't run a review website that claims to offer independent reviews about products that they happen to sell.

• Companies can't use any kind of threats or intimidation to remove negative reviews, and they can't hide bad reviews if they are presenting the product's reviews as the full set of reviews. For example, a restaurant could advertise some select positive authentic reviews on their website, but for their listing on a platform like Yelp that shows all reviews, they couldn't just pay someone to remove the bad reviews. 

• Manipulation of social media accounts through buying followers, views, or comments when the buyer knows the activity is fake, is now banned. So, a doctor seeking to quickly boost the ratings of their practice on Yelp won't be able to buy a bunch of fake positive reviews.