With online reviews impacting nearly every aspect of our lives, e-commerce companies need to proactively combat fake review scams. They can cause significant short-term commercial losses and erode consumer trust in the long run.
The easiest way to spot a fake review is by looking for duplicate language. A group of paid writers may use the same language over and over again.
1. They harm consumers.
Fake reviews undermine consumer trust, which is at the heart of the marketplace. Whether they are positive or negative, fake customer reviews can harm businesses by increasing search engine penalties, deflating sales, or raising the risk of regulatory scrutiny or a damaging lawsuit.
There are a variety of ways to create fake online reviews: bribing or paying reviewers, incentivizing reviewers by offering free goods or cash, and engaging in shady advertising practices like purchasing followers, views, or subscriptions to boost a company’s credibility. These tactics are illegal and can subject businesses to hefty fines from regulators and customers.
Moreover, these types of marketing strategies are also dangerous for consumers who may be deceived into buying products that are not as good as advertised or might end up with a poor product experience. For example, the FTC recently sued fashion brand Fashion Nova for $4.2 million after it paid to suppress negative reviews. For small businesses, the costs of combating fake review Is Legit or Scam can eat into margins and raise funding rounds — ultimately costing business owners valuable opportunities to grow their companies.
2. They hurt small businesses.
A fake review scam costs small businesses time and money as they fight to repair their reputation. One bogus review can send a wave of unsatisfied customers running for the hills. Another can cause a sudden and dramatic drop in search engine ranking. It can even cost a business sales.
Large online ecommerce platforms are also harmed by fake reviews. They need honest feedback from customers to sell their products and services. But when review fraud skews the market, it undermines the trust of legitimate sellers and attracts buyers to questionable merchants.
Some large retailers are fighting back against review fraud. Walmart, eBay, and Yelp all have programs to identify fake reviews and shut down review brokers. But they need help from Congress to reform outdated laws like CDA230 and get enough resources to crack down on this problem. Otherwise, bad actors will find new ways to rig the marketplace.
3. They’re deceptive.
Fake reviews are deceptive because they mislead consumers by pretending to be authentic, unbiased endorsements. And they violate the most widespread self-regulation advertising standards. In the United States, if a company pays people to write fake reviews of their product or service, they can face significant civil penalties.
Consumers rely on online reviews to find reliable information about products and services. But when fake reviews skew the marketplace, honest businesses suffer and shoppers lose confidence in reviews. This can cost real consumers money and hurt them when they make purchases.
Many of these scams take place on Facebook groups where sellers offer buyers money in exchange for positive reviews. These types of schemes also violate Facebook’s community standards, and Google’s prohibition on fraudulent content. And yet, outdated tech laws give these platforms immunity from liability when they knowingly host this illegal activity. That’s unfair and dangerous for consumers, honest companies and the economy. It’s time to fix this.
4. They’re illegal.
Many people rely on online reviews when selecting restaurants, medical providers and contractors, among other things. But fake reviews can cause serious harm. They can skew search results, mislead consumers and lead to unfair or deceptive business practices.
Tech firms that host user-generated content have a big responsibility to police their platforms for fraudulent reviews. But they often lack adequate resources to prevent and respond to fraud, because of the 1996 Communications Decency Act’s Section 230 protections that give these companies immunity for hosting illicit commerce.
We’re filing this consumer protection lawsuit to help put an end to this abuse. We’re also calling on Congress to reform Section 230 to ensure that these immunity protections don’t shield tech firms from the responsibility to police their products for illegal commerce. That would require ensuring that review platforms provide law enforcement and consumers with evidence of fraudulent activity. This would make it easier for these tech companies to identify and take action against scammers.