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The Federal Trade Commission said Tuesday it's settled its first action against a marketer who used fake paid reviews to boost sales of its product on Amazon.
The FTC had accused Cure Encapsulations of paying AmazonVerifiedReviews.com to write and post fake reviews to maintain an average Amazon rating of 4.3 out of 5 stars for the company's garcinia cambogia weight-loss supplement. The agency had also accused the company of making false and unsubstantiated claims, including reviews that said the product caused weight loss of two or more pounds each and "literally blocks fat from forming."
[...] Under the terms of the proposed settlement, Cure Encapsulations is barred from making claims about the health benefits of dietary supplements without supporting clinical evidence. The defendants are also required to notify its customers of the allegations against it and identify for Amazon which reviews it purchased.
A $12.8 million judgment was levied against Cure Encapsulations, but it will be suspended when the company pays $50,000 to the FTC and fulfills other tax obligations. The full amount of the judgment will be immediately due if the commission finds the company misrepresented its financial condition.
(Score: 1, Insightful) by Anonymous Coward on Wednesday February 27 2019, @03:23PM (3 children)
$50,000
(Score: 4, Interesting) by FatPhil on Wednesday February 27 2019, @04:48PM (2 children)
Apparently, Amazon have taken things into their own hands, sueing back in 2016:
"""
Amazon Sues Five Sites Promising Reviews For Cash
4.26.16 10:19 AM EDT By Ashlee Kieler@akieler
amazon lawsuit reviews cracking down on fake reviews book reviews Paying For reviews
Since filing its first lawsuit to block companies from selling fraudulent positive reviews last April, Amazon has taken a number of steps to cutback on the number of fake review peppering its site: data mining reviewers’ personal relationships, tweaking how reviews appear on product pages, and suing more than 1,100 individual reviewers who sell their kind words. Now the e-commerce giant has sued five additional sites, accusing them of selling sham reviews.
Amazon filed the lawsuit Friday in a Washington state court against five websites — PaidBookReviews.org, AmazonVerifiedReviews.com, AmazonReviewsStar.com, BuyAmazonReviews.info, and ReviewConnections.com — and their operators, accusing the companies of an array of illegal business practices that undermine the e-tailer’s operations.
According to the lawsuit [PDF], the five sites and seven operators violated Amazon’s terms of use in order to deceive customers into purchasing sometimes sub par products.
"""
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2) by Immerman on Wednesday February 27 2019, @05:22PM (1 child)
What's misrepresenting? They're reviews. They're on Amazon. And you can easily verify both facts.
Oh, you mean the lie by implication? That's perfectly legal, even business as usual, and every commercial company and advertising agency in the nation would be up in arms if you tried to crack down on it. The entire point of advertising is to lie to potential customers about the value of the product so that they're more likely to buy it, and more willing to overpay.
(Score: 2) by PartTimeZombie on Wednesday February 27 2019, @07:50PM
I was thinking something similar.
There are two companies advertising on TV where I live that I think ought to be prosecuted for misrepresentation. One is a payday loan company that has a bunch of attractive young people explaining how easy it is to get money, and "the money can be in your account the same day" but I bet none of them are actually customers. Also what is the interest rate? 25%? More?
The other is for Pain Erazor™ whioch has no batteries or drugs and apparently uses "the bodies' natural pain defenses" of something. I'm fairly sure that's nonsense.
Paid Amazon reviews look like business as usual to me too.