Rose

Chair

The Federal Trade Commission has announced new rules that will affect social media influencers and businesses. Under these new rules, the FTC will seek civil penalties against those who engage in releasing AI-generated fake reviews. 
According to the details from the <a href="https://www.ftc.gov/news-events/news/press-releases/2024/08/federal-trade-commission-announces-final-rule-banning-fake-reviews-testimonials" target="_blank" rel="noopener nofollow">release</a>, the final rule was announced by the FTC to fight fake reviews and testimonials generated by AI. The new rule prohibits the sale and purchase of these fake reviews, which will also invite civil penalties. 
FTC Chair Lina M. Khan said, “Fake reviews not only waste people’s time and money, but also pollute the marketplace and divert business away from honest competitors.” Lina stated that by implementing the final rule, Americans will be protected from getting cheated. 
<h3 id="span-style-font-weight-400-federal-trade-commission-prohibits-fake-social-media-indicators-span">Federal Trade Commission prohibits fake social media indicators</h3> 
The final rule by the Federal Trade Commission has mentioned the things that are prohibited under it. The press release stated that, under the final rule, people are prohibited from buying or selling fake indicators of social media influence. These include followers and views that are generated by a hijacked account or a bot. 
The FTC also stated that this prohibition is limited to situations where the buyer knew that the indicators were fake and that they would misrepresent the buyer’s influence. 
Marketing and e-commerce lawyer <a href="https://x.com/RobertFreundLaw/status/1823789026249466328" target="_blank" rel="noopener nofollow">Rob Freund</a> spoke about the final rule on X. Rob stated that anyone who is juicing their views, plays, subscriptions, saves, likes, etc., through any inauthentic means will be a violator. 
<h3 id="span-style-font-weight-400-ftc-s-final-rule-could-come-as-early-as-october-span">FTC’s final rule could come as early as October</h3> 
The Federal Trade Commission has prohibited fake reviews, including AI-generated ones, written by individuals who did not have actual experience with the business, its products, or services, or that misrepresent the reviewer’s experience. 
Under the rule, businesses are prohibited from selling or even creating these reviews. The businesses are also banned from buying these reviews especially after knowing that the testimonials are fake. 
As per the details from the release, the final rule will be implemented 60 days after the date of its Federal Register publication. In this case, it could come as early as October. 
Following this announcement on X, the community has expressed their opinion on the new rule. The majority of the people on X commented positively regarding the final rule. X user <a href="https://x.com/JonathanRoseD/status/1823814859936686348" target="_blank" rel="noopener nofollow">Jonathan Rose Dunlap</a> stated that this is a huge win for retail shoppers. 
Some other users also asked about the penalties for the violation, expecting that they would be severe.

Federal Trade Commission bans AI-generated fake reviews

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