The Federal Trade Commission has unanimously voted to ban marketers from using fake reviews, including those generated with AI technology, to promote their products. The new rule, which will go into effect in mid-October, also prohibits companies from paying for positive or negative reviews or inflating their influence with bots. Violations of the rule could result in fines for each offense, potentially adding up quickly for companies with a large number of reviews. The rise of e-commerce, influencer marketing, and generative AI has led to an increase in fake reviews, prompting the FTC to take action.
Some e-commerce companies have already taken steps to combat fake reviews, with Amazon suing over 10,000 Facebook group administrators for brokering fake reviews in July 2022. The new rule will provide stricter government oversight and enforcement of the ban on fake reviews, streamlining the process for the FTC to take action.
The announcement of the new rule coincided with the White House’s first “Creator Economy Conference,” where Biden administration officials listened to concerns from online influencers and digital content professionals. The new rule aims to protect consumers from false advertising and misleading information, ensuring a fair marketplace for honest businesses.
Photo credit
www.nbcnews.com
