FTC wants to ban fake reviews

If you too are so tired of not knowing which reviews you can trust on the internet, we can finally give you some peace of mind. That’s because the Federal Trade Commission now wants to punish companies for engaging in shady review practices. Under a new rule proposed by the FTC, businesses could face fines for buying fake reviews — up to $50,000 for each time a customer sees one.

You know those one-line reviews on Amazon listings that not completely seem legit? Like those who give a product five stars and say something incredibly vague, like “This is such a great item,” without elaborating on any details? Well, that’s just one type of fake feedback that the FTC wants to crack down on.

The FTC’s proposed rule seeks to ban several different types of disingenuous reviews and would penalize not only the companies that use them, but also the brokers who falsify reviews. That includes the companies that buy or sell fake reviews, as well as those that buy or sell fake followers or views on social media.

Other notable caveats include a ban on “insider” reviews and testimonials, which would prohibit a company from posting reviews from managers, employees and even relatives of workers without proper disclosure. It also addresses “review hijacking,” a deceptive practice that involves reusing reviews from other products, which the FTC cracked down on for the first time this year.

In April, the FTC fined The Bountiful Company, the business behind Nature’s Bounty supplements, $600,000 for allegedly exploiting Amazon’s product variety feature. This feature allows sellers to group different colors, sizes, or flavors of the same item into a single listing that shares the same reviews. However, the FTC alleges that The Bountiful Company used this feature to bundle completely different products into the same listing, with the goal of increasing reviews of a lower-rated item by grouping it with a higher-rated one.

The FTC also wants to crack down on company-controlled review sites that claim to “provide independent opinions about a category of products or services that includes its own products or services.” For example, it would prevent companies from creating their own websites – which they claim not to be associated with – to recommend their own products. The FTC’s rule would also fine companies that try to suppress negative reviews through threats or other means.

For years, Amazon, Facebook, Google, Yelp and other online platforms have tried to combat fake reviews. But with generative AI becoming more widespread, it’s bound to get worse – and much harder to control. The FTC mentions this in its proposal, noting that “the widespread emergence of AI chatbots is likely to make it easier for bad actors to write fake reviews.”

We’re already starting to see AI-generated views populate the web. As my colleague James Vincent points out, you can see how much AI-generated garbage is out there by googling “like an AI language model.” It’s the disclosure AI chatbots that ChatGPT spits out when asked for their opinion on certain things, but it can also show up in spam content, and sometimes fake reviews that the poster didn’t bother to delete.

“Our proposed rule on false reviews demonstrates that we are using every means available to attack deceptive advertising in the digital age,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection. “The rule will trigger civil penalties for violators and should help level the playing field for honest companies.”

If the rule goes into effect, it’s still not entirely clear how the FTC plans to track down and punish the companies that use or sell fake reviews. While the FTC has voted to approve the proposal, it is now taking public comments that it will consider as it moves forward with it. I just hope it will at least discourage some of the low-stakes fakes I see online—or maybe it will just inspire them to do better. Hey, if I’m going to read a fake review, at least make one good.