The Federal Trade Commission (FTC) announced on Wednesday a final rule that bans online fake reviews and testimonials and allows the agency to seek civil penalties from known violators.
The rule seeks to curb the volume of reviews generated by artificial intelligence or written by someone who misrepresents their experience with the product or service in exchange for compensation. It also targets the practice of inconspicuously suppressing negative reviews.
“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 said in a news release.
“By strengthening the FTC’s toolkit to fight deceptive advertising, 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,” she added.
The agency proposed the rule in June 2023 and held an informal hearing in February 2024. …