“Consumers turn to online reviews because they want to know what it will be like to work with you before they buy,” said Kenneth Burke, vice president of Marketing at Text Request. “They want to avoid potentially bad situations, and be assured that they're not going to have a bad time.” 

But, on the other side of the coin, some businesses will use fake reviews, he said, generated from employees, fake accounts, or by specifically paying agents who have not otherwise been a customer of the company, in order to rank high in search results and appear as if they are great to work with.  

“Consumers need honesty and transparency to help them make a decision,” Burke said. “Otherwise they will write off anything you say as a business (which is sort of why they turn to reviews anyway — they want to hear from others).” 

Chris Lollini, owner of Reputation Igniter, said while it’s nice that the federal government agrees fake reviews are an issue, most consumers are already savvy enough to spot them.  

“This shouldn’t change things for any contractor who has been playing by the rules all the time,” Lollini said. “Have a consistent and transparent follow-up system that empowers your customers to share the good and the bad. It makes you more human in an AI world. And the bad reviews give you the opportunity to show how much you truly care about your community when you write the inevitable mistakes you’ll make. Never shy away from an opportunity to build trust in that way.” 

FTC Ruling Overview 

Under the new, finalized rule, the FTC is prohibiting the following, according to its website: 

• Fake or False Consumer Reviews, Consumer Testimonials, and Celebrity Testimonials: The final rule addresses reviews and testimonials that misrepresent that they are by someone who does not exist, such as AI-generated fake reviews, or who did not have actual experience with the business or its products or services, or that misrepresent the experience of the person giving it. It prohibits businesses from creating or selling such reviews or testimonials. It also prohibits them from buying such reviews, procuring them from company insiders, or disseminating such testimonials, when the business knew or should have known that the reviews or testimonials were fake or false. 

• Buying Positive or Negative Reviews: The final rule prohibits businesses from providing compensation or other incentives conditioned on the writing of consumer reviews expressing a particular sentiment, either positive or negative. It clarifies that the conditional nature of the offer of compensation or incentive may be expressly or implicitly conveyed. 

• Insider Reviews and Consumer Testimonials: The final rule prohibits certain reviews and testimonials written by company insiders that fail to clearly and conspicuously disclose the giver’s material connection to the business. It prohibits such reviews and testimonials given by officers or managers. It also prohibits a business from disseminating such a testimonial that the business should have known was by an officer, manager, employee, or agent. Finally, it imposes requirements when officers or managers solicit consumer reviews from their own immediate relatives or from employees or agents — or when they tell employees or agents to solicit reviews from relatives and such solicitations result in reviews by immediate relatives of the employees or agents. 

• Company-Controlled Review Websites: The final rule prohibits a business from misrepresenting that a website or entity it controls provides independent reviews or opinions about a category of products or services that includes its own products or services. 

• Review Suppression: The final rule prohibits a business from using unfounded or groundless legal threats, physical threats, intimidation, or certain false public accusations to prevent or remove a negative consumer review. The final rule also bars a business from misrepresenting that the reviews on a review portion of its website represent all or most of the reviews submitted when reviews have been suppressed based upon their ratings or negative sentiment. 

• Misuse of Fake Social Media Indicators: The final rule prohibits anyone from selling or buying fake indicators of social media influence, such as followers or views generated by a bot or hijacked account. This prohibition is limited to situations in which the buyer knew or should have known that the indicators were fake and misrepresent the buyer’s influence or importance for a commercial purpose. 

“As the Commission noted previously, case-by-case enforcement without civil penalty authority might not be enough to deter clearly deceptive review and testimonial practices,” stated an FTC press release. “The Supreme Court’s decision in AMG Capital Management LLC v. FTC has hindered the FTC’s ability to seek monetary relief for consumers under the FTC Act. This rule will enhance deterrence and strengthen FTC enforcement actions.” 

“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 M. Khan added. “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.”