On February 13, the Federal Trade Commission (FTC) will hold an informal hearing on its proposed rule banning fake reviews and testimonials.

Open to the public and live streamed (10am ET), the meeting follows the FTC’s July 2023 notice proposing a new rule to stop marketers from using illicit review and endorsement practices  such as using fake reviews, suppressing honest negative reviews and paying for positive reviews, which deceive consumers looking for real feedback on a product.  And, these also undercut honest businesses, too.

Mary K. Engle, EVP Policy, BBB National Programs is an expert on the topic.

Before joining BBB National Programs, she directed the Federal Trade Commission’s (FTC) Division of Advertising Practices, enforcing truth-in-advertising principles for national advertising matters. She also examined social media and digital technology marketing practices. Her investigations and law enforcement actions in this area helped create new policies and standards that are now used to govern influencer marketing, native advertising, and privacy cases.

In this Happi podcast, Engle digs into fake review practices. While there are no specific data points on how prevalent this is in the beauty industry, the category isn’t immune to the topic. She references a 2019 settlement between FTC and Sunday Riley, as reported by Happi.

FTC’s proposed rule would prohibit:
• Selling or Obtaining Fake Consumer Reviews and Testimonials
• Review Hijacking
• Buying Positive or Negative Reviews
• Insider Reviews and Consumer Testimonials
• Company Controlled Review Websites
• Illegal Review Suppression
• Selling Fake Social Media Indicators

The proposed rule follows an advance notice of proposed rulemaking the FTC announced in November 2021.