On Wednesday, August 14, the Federal Trade Commission (FTC) finalized a rule to ban fake reviews and testimonials, including those generated by artificial intelligence (AI). According to the new rule, the maximum civil penalty for those using fake reviews is $51,744 per violation. According to the FTC press release …

“The Federal Trade Commission today announced a final rule that will combat fake reviews and testimonials by prohibiting their sale or purchase and allow the agency to seek civil penalties against knowing violators.

“Fake reviews not only waste people’s time and money, but also pollute the marketplace and divert business away from honest competitors,” said FTC Chair Lina M. Khan. “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.”

The final rule announced today follows an advance notice of proposed rulemaking and a notice of proposed rulemaking announced in November 2022 and June 2023, respectively. The FTC also held an informal hearing on the proposed rule in February 2024. In response to public comments, the Commission made numerous clarifications and adjustments to its previous proposal.”

To continue reading the full FTC press release, click here.

And to learn more about this new regulatory rule, check out this article from TechCrunch.