The FTC Fosters Fake Reviews, Its Own Commissioners Say

Two FTC commissioners have blamed their own agency for the proliferation of fake reviews on the web. From a report: Commissioners Rohit Chopra and Rebecca Slaughter of the Federal Trade Commission say it's about to get a lot worse, and they know who to blame: their own agency. The FTC this month brought its first case against a company for enlisting its employees in a coordinated fake-review campaign to boost sales. Chopra and Slaughter say the decision reached by their fellow commissioners could usher in even more review fraud. The settlement did not require the company to admit fault, notify customers of the fraud, or turn over any ill-gotten gains. "Dishonest firms may come to conclude that posting fake reviews is a viable strategy, given the proposed outcome here," Chopra said in a statement dissenting from the FTC's decision, joined by Slaughter. "Honest firms, who are the biggest victims of this fraud, may be wondering if they are losing out by following the law. Consumers may come to lack confidence that reviews are truthful." The case in question concerns skin-care brand Sunday Riley, which on Monday agreed to settle FTC charges that it posted faked reviews for its products on Sephora's website for nearly two years. The FTC has the power to punish companies for engaging in online review fraud through fines, forfeitures, or notices, among other things. But the Sunday Riley decision amounted to little more than finger wagging, Chopra and Slaughter say. The dissenting commissioners say the agency's investigation uncovered more than enough evidence to prove that Sunday Riley had engaged in online review fraud -- including an Instagram comment posted by a brand representative that confirmed the company had posted fake reviews. But the FTC voted 3â"2 to allow Sunday Riley to settle the charges by agreeing not to post future fake reviews, without admitting fault.

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