FTC Resolves Its First Ever Case On Fake Amazon Reviews

Fake reviews on Amazon are annoying because they present a false view of the product which could end up being a lot worse than what the reviews gave the impression of. Amazon has been working tirelessly against such fake reviews and have been trying to take down websites that advertise fake reviews for sale.

However it seems that Amazon’s fight against fake reviews might have gotten a boost thanks to the precedent set by the FTC (via Engadget) in which the government agency has managed to resolve their first-ever case on fake Amazon reviews. The case was against a company known as Cure Encapsulations Inc. and its owner Naftula Jacobowitz who were caught buying fake reviews.

According to Andrew Smith, the Director of FTC’s Bureau of Consumer Protection, “When a company buys fake reviews to inflate its Amazon ratings, it hurts both shoppers and companies that play by the rules.” The FTC has since hit the company with a massive fine of $12.8 million, but this fine can and will be suspended if they were to make a payment of $50,000 to the FTC.

However this fine can come back in full should the company violate the settlement’s terms. This includes Jacobowitz and his company now being obligated to tell previous buyers that the FTC has questioned their product’s efficacy claims, and will need to identify and tell Amazon about every fake review that they have ever bought and paid for.

Tyler Lee
Categories: General
Tags: Amazon, ftc, Legal