TechFlow news: The U.S. Federal Trade Commission (FTC) announced that commissioners have unanimously voted 5-0 to adopt new federal regulations aimed at combating fake reviews and fraudulent social media influence. The rule will take effect 60 days after publication in the Federal Register, with potential implementation as early as October this year. Crypto KOLs who inflate their social media influence through fake followers, views, and likes could face penalties. Violations of the new rule may result in fines of up to $50,000 per offense.
Specific provisions include:
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Prohibiting the buying or selling of fake social media influence metrics.
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Banning the use of artificial intelligence to create fake reviews.
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Restricting conduct by company insiders regarding posting reviews and suppressing reviews.
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Establishing new rules for review websites.
FTC Chair Lina Khan stated that fake reviews not only waste people's time and money but also pollute the marketplace and divert business away from honest competitors. This final rule will protect Americans from deception.
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