Cosmetic

FTC puts companies on notice about fake reviews, misleading endorsements

The Agency sent the Notice of Penalty Offenses to more than 700 companies, including many cosmetics, beauty, and personal care companies and retailers. The full list can be found HERE​​.

“The rise of social media has blurred the line between authentic content and advertising, leading to an explosion in deceptive endorsements across the marketplace,” ​explained the Agency in a release. “Consequently, the FTC is now using its Penalty Offense Authority to remind advertisers of the law and deter them from breaking it. By sending a Notice of Penalty Offenses to more than 700 companies, the agency is placing them on notice they could incur significant civil penalties—up to $43,792 per violation—if they use endorsements in ways that run counter to prior FTC administrative cases.”

The companies receiving the notice represent an array of large companies, top advertisers, leading retailers, top consumer product companies, and major advertising agencies. It should be stressed that just because a company received a letter from the FTC does not in any way suggest that it has engaged in deceptive or unfair conduct, said the Agency. The letters are just putting businesses on notice about the penalties associated with any potential offenses.

“Fake reviews and other forms of deceptive endorsements cheat consumers and undercut honest businesses,”​ said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “Advertisers will pay a price if they engage in these deceptive practices.”

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