The FTC Fake Review Rule: What Businesses Need to Know

The FTC fake review rule is the Federal Trade Commission’s Trade Regulation Rule on the Use of Consumer Reviews and Testimonials (16 CFR Part 465). Announced in August 2024 and in effect since October 21, 2024, it bans fake and AI-generated reviews, buying reviews that must be positive or negative, undisclosed insider reviews, fake “independent” review sites, review suppression through threats, and fake social media followers or views. Because it is a formal rule, the FTC can seek civil penalties for each violation.

For most honest businesses, the rule doesn’t require big changes. It does close several gray areas that used to be common, such as a discount “for your five-star review”, staff reviewing their own employer, or quietly hiding low ratings on a product page. This guide explains each part in plain English. It isn’t legal advice; if your situation is unusual, talk to a lawyer who works on advertising law.

Why the FTC made a specific rule

Fake reviews were already illegal as deceptive practices under Section 5 of the FTC Act. The difference is enforcement. Under the general law, the FTC’s main tools were orders telling companies to stop. A trade regulation rule spells out specific prohibited conduct, and violating it can lead to civil penalties from the first offense.

The FTC announced the final rule on August 14, 2024, after a unanimous Commission vote, and it took effect on October 21, 2024. In December 2025, the FTC sent warning letters to ten companies about possible violations, a sign that it is watching how businesses handle reviews.

What the FTC fake review rule prohibits

The rule has six main prohibitions. The FTC’s own business guidance summarizes them, and the headings below follow that structure.

1. Fake or false reviews and testimonials

Businesses can’t write, create, sell or buy reviews or testimonials that misrepresent who wrote them or what their experience was. That includes reviews attributed to people who don’t exist, such as AI-generated fake reviews, and reviews from people who never used the product or service. It also covers testimonials that misrepresent the reviewer’s actual experience.

The ban applies to businesses that create or buy these reviews, and to those who procure or disseminate them when they knew or should have known they were fake. The FTC has said ordinary consumers aren’t liable under the rule for the reviews they write.

AI itself isn’t banned. Using AI to help draft a reply to a review is fine. Using AI to generate reviews that pose as real customers is not.

2. Buying reviews that must say something particular

The rule prohibits offering compensation or other incentives conditioned on a review expressing a particular sentiment, positive or negative. “A gift card for a five-star review” is out. So is paying someone to leave negative reviews on a competitor.

The FTC’s guidance says incentives for reviews in general aren’t banned by this rule, as long as there’s no express or implied requirement about sentiment. That doesn’t make them a good idea: Google’s policy for Maps content prohibits offering incentives such as payment, discounts or free goods in exchange for any review, and other platforms have their own rules. Our guide on how to get more Google reviews explains how to ask without offering anything.

3. Insider reviews without disclosure

Reviews and testimonials from officers, managers, employees or agents must clearly and conspicuously disclose their connection to the business. The same applies when a business asks employees’ relatives or agents to post reviews and knows or should know about the relationship.

There is a practical exception in the FTC’s guidance: if you send a general review request to all your customers and an employee happens to be one of them, you’re not liable just because they responded without a disclosure. The rule targets businesses that direct or encourage insiders to review.

4. Company-controlled “independent” review sites

A business can’t run a website or organization that claims to offer independent reviews or opinions about a category of products or services when the business controls it and it features the business’s own products. A “best mattresses of the year” comparison site secretly owned by a mattress brand is the classic example.

5. Review suppression

The rule covers two kinds of suppression:

• Threats and intimidation. Businesses can’t use unfounded or groundless legal threats, physical threats, intimidation, or public false accusations to stop someone posting a review or to get one removed.
• Hiding negative reviews on your own site. If you display reviews on your website, you can’t suppress reviews based on their rating or negative sentiment while presenting what’s shown as all or most of the reviews you received.

You can still hold back reviews for legitimate reasons, applied the same way regardless of sentiment. The rule lists examples such as content that is defamatory, harassing, abusive, obscene or discriminatory, contains someone’s personal or confidential information, is clearly false or misleading, is reasonably believed to be fake, or is unrelated to your products or services.

This sits alongside the Consumer Review Fairness Act of 2016, which already stops businesses from using contract terms to gag customers from posting honest reviews.

6. Fake social media indicators

The rule prohibits selling or buying fake indicators of social media influence, such as followers or views generated by bots or hijacked accounts, when the buyer knew or should have known they were fake and uses them to misrepresent influence or importance for a commercial purpose. Buying followers to make a brand account look bigger falls into this.

Who the rule applies to

The rule applies to businesses that market products and services, including ecommerce sellers, local businesses, apps, agencies and review brokers that sell fake reviews. It is enforced by the FTC across the US. Platforms like Google, Yelp and Amazon also have their own review policies, which are often stricter than the rule and are enforced by removing reviews or restricting accounts.

If you sell online, especially on marketplaces or through your own product pages, the review display and incentive rules deserve the closest look. Our page on ecommerce reputation management covers the platforms involved. For Amazon specifically, our guide to the Amazon review tools sellers may use shows what is allowed. Some professions have extra rules on top: financial advisors, for example, also answer to SEC and FINRA rules on testimonials, covered on our page on financial advisor reputation management.

What the penalties look like

Violations can lead to a federal lawsuit and civil penalties for each violation. In its December 2025 warning letters, the FTC stated that civil penalties could be up to $53,088 per violation. That maximum is adjusted for inflation each year, so check the FTC’s website for the current figure. Because penalties are assessed per violation, the total exposure can add up quickly.

Beyond FTC action, the practical costs are often felt first on the platforms: removed reviews, warnings displayed on your profile, lower visibility, or suspended seller accounts.

Compliance checklist for businesses

Use this as a starting point for reviewing your own practices. It isn’t legal advice, and a lawyer can help you with anything specific to your business or industry.

Area	Check
Review sources	Every review you publish or promote comes from a real customer with a real experience. No bought, AI-generated or staff-written reviews posing as customers.
Vendors	Any agency or tool you use for reviews collects them only from real customers, never writes them, and puts that in writing.
Incentives	No reward is tied to a positive rating, explicitly or implicitly. Better still, no incentives for reviews at all, in line with Google’s policy.
Requests	Review requests go to all customers, not only those you expect to be happy.
Employees and family	Staff know not to review your business, or to clearly disclose their connection if they post about it. No asking relatives to review.
Your website	Displayed reviews aren’t filtered by star rating or sentiment. Any moderation rules are written down and applied to positive and negative reviews alike.
Responses and disputes	No legal threats against honest reviewers, no public accusations of lying, no contract terms that restrict reviews.
Testimonials in ads	Testimonials reflect real customers’ actual experiences, and any material connection (payment, free product, relationship) is disclosed.
Comparison content	Any “best of” or review site you run clearly discloses that you own it and sell the products it covers.
Social media	No purchased followers, likes, views or other engagement.

A worked example: auditing an online store

Here’s an illustrative scenario, not a real client. A small online skincare brand runs an internal check against the rule and finds three problems.

1. A post-purchase email offering a discount code “for your 5-star review”. This is an incentive conditioned on sentiment, which the rule prohibits. They remove the offer entirely and send a plain request for an honest review to every customer.
2. The product page widget shows only reviews rated four stars and above, under a heading that says “What our customers say”. Filtering by rating while presenting the result as representative is the kind of suppression the rule addresses. They switch the widget to show all reviews and write a short moderation policy covering spam, profanity and personal information, applied regardless of rating.
3. Two early reviews were written by the founder’s friends who received free products and didn’t mention it. They remove those reviews and decide that any future reviews from people who receive free products will carry a clear disclosure.

None of these changes stop them collecting reviews. The average star rating on their site may dip slightly once lower ratings are visible, but the reviews are now ones they can defend, and a realistic mix of ratings often reads as more credible than a wall of perfect scores.

Common misunderstandings

• “Asking for reviews is now illegal.” It isn’t. Asking customers for honest reviews is fine under the rule. Some platforms, such as Yelp, discourage asking, but that’s a platform policy, not the FTC rule.
• “I can’t reply to negative reviews anymore.” You can. Replying publicly and contacting a customer to resolve a complaint are not suppression. Threats and intimidation are. If a customer is the one making threats, see what to do when a customer threatens a bad review. Our guide on removing fake Google reviews covers legitimate ways to deal with reviews that break platform rules.
• “Reporting a fake review is suppression.” No. Reporting reviews that break a platform’s policies through the platform’s own process is normal and expected.
• “The rule only covers Google reviews.” It covers reviews and testimonials wherever they appear, including your own website, marketplaces, social media and advertising.

Where to find the official text

The FTC publishes the final rule, a plain-language question-and-answer guide for businesses, and related press releases on ftc.gov. Search for “Consumer Reviews and Testimonials Rule” on the FTC’s site to find the current versions. If you’re making significant changes to how you collect or display reviews, those pages and a conversation with a lawyer are worth the time.

If you’d like help setting up a review program that stays within the rule and platform policies, our review management service handles requests, monitoring and replies for businesses of all sizes.

Frequently asked questions

When did the FTC fake review rule take effect?

The FTC announced the final rule on August 14, 2024, and it took effect on October 21, 2024. It is codified at 16 CFR Part 465.

Can I still offer an incentive for leaving a review?

The FTC rule prohibits incentives that are conditioned, expressly or implicitly, on a review being positive or negative. Google’s policy goes further and prohibits incentives for any review on Maps, so for most businesses the safest choice is to offer no incentive at all.

Does the rule apply to small businesses?

Yes. The rule doesn’t carve out small businesses. It applies to any business that creates, buys or promotes fake reviews, conditions incentives on sentiment, or uses the other practices it prohibits.

Can my employees review my business?

Only if they clearly and conspicuously disclose that they work for you, and even then platforms such as Google treat employee reviews as a conflict of interest and may remove them. The simplest policy is to ask staff not to review their own employer.

Is it allowed to remove negative reviews from my own website?

You can remove reviews for legitimate, consistently applied reasons such as spam, abuse, personal information or content unrelated to your products. You can’t hide reviews because they are negative while presenting the remaining reviews as representative.