Washington, D.C. – The Federal Trade Commission (FTC) has announced a new rule aimed at curbing the proliferation of fake reviews and product testimonials online, including those generated by artificial intelligence. This rule represents a significant step in the FTC’s ongoing efforts to address deceptive advertising practices in the digital marketplace.
The final rule prohibits businesses from creating, selling, or using fake reviews, including those produced by AI technologies. This includes the prohibition of purchasing fake reviews for e-commerce brands and generating such reviews. Additionally, the rule bans the buying or selling of fabricated social media metrics, such as likes, follows, or views, that are generated by bot accounts.
The regulation is particularly focused on social media platforms, enforcing standards where the buyer “knew or should have known” that engagement metrics were artificially inflated by bots. This targeted approach aims to tackle deceptive practices while recognizing the complexities of digital engagement.
“Fake reviews not only waste people’s time and money but also pollute the marketplace and divert business away from honest competitors,” stated FTC Chair Lina M. Khan. “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.”
The FTC’s initiative to combat fake reviews began in November 2022, evolving through several draft versions before arriving at the final rule announced this week. The commission’s concern has grown with the rise of generative AI technologies, which have made it easier to produce convincing fake reviews.
The new rule will be implemented 60 days after its publication in the Federal Register, following unanimous approval from the FTC commissioners. This rule is expected to enhance transparency in online reviews and protect consumers from misleading practices in the digital economy.
