November 29th, 2022 – Jonathon D. Nelson, General Counsel for Dedicated Financial GBC
Long before the FTC and CFPB took an interest in company reviews, Dedicated has been auditing each review that is earned. The purpose of Dedicated’s audit is primarily to verify the authenticity of each review, and the byproduct is praise given to the team member that is responsible for the review.
In late 2021, the FTC reminded the nation that posting fake reviews constituted a deceptive practice (i.e., UDAAP violation), and sent a Notice of Penalty Offenses to more than 700 companies. The CFPB followed by issuing a compliance bulletin cautioning against the use of fake reviews and stating that the CFPA and CFRA will be used to hold companies liable for using fake reviews.
More recently, the FTC joined forces with several states to bring a lawsuit alleging thousands of fake reviews that led to consumers subscribing to an allegedly bogus service, which was settled in part for a payment of $100,000 and a lifetime ban from selling reviews. The FTC has also sued Google and iHeartMedia for allegedly advertising 29,000 fake reviews of Google’s Pixel 4 phone, and to date, the settlements call for $9,400,000 in financial penalties. The takeaway: reviews must be earned, not purchased.