The U.S. Federal Trade Commission (FTC) continues to crack down on false and deceptive marketing practices. As part of this effort, the FTC issued a new rule in August 2024 that covers fake or false customer reviews and testimonials.
Many businesses are already breaking this rule without knowing it. For example, if one of your friends writes a review for your business, that material connection (your friendship) must be clearly disclosed as part of the review.
There are also many other restrictions in the rule about what can and cannot be done in reviews and testimonials. It’s worth the time to read them and consult with an attorney if necessary because one FTC lawsuit for violating this rule can wipe out a lot of your company’s profits and may even bankrupt it.
Also note that states tend to follow the FTC when it come to consumer protection. So, if your business gets in trouble with the FTC, there’s a good chance that one or more states’ Attorneys General will be going after your company too.
Here’s a link to the PDF file containing the FTC rule covering fake reviews.
