The FTC fake reviews rule: what it means for your business
Since October 21, 2024, the FTC's rule bans US businesses from writing, buying or spreading fake reviews, paying for a positive or negative review, hiding insider reviews, running fake independent review sites, suppressing reviews with threats, and buying fake followers. Courts can fine knowing violations. Ask every customer honestly and offer nothing tied to a good review.
The short version
- The FTC’s Consumer Reviews and Testimonials Rule took effect on October 21, 2024.
- It bans fake reviews, paying for a particular sentiment, undisclosed insider reviews, fake “independent” review sites, review suppression and fake followers.
- Asking every customer for an honest review is fine.
- Asking only happy customers isn’t banned by the rule itself, but the FTC says it could break the wider law.
- Courts can impose civil penalties for knowing violations. This isn’t legal advice.
What does the rule ban?
The FTC announced the final rule on August 14, 2024. Here’s each ban in plain terms, from the FTC’s business Q&A.
| The rule bans | What it looks like in a small business |
|---|---|
| Fake reviews and testimonials | Writing reviews yourself, buying them, or using AI to write reviews from people who don’t exist |
| Paying for a particular sentiment | “Leave us five stars and get a discount on your next visit” |
| Undisclosed insider reviews | A manager or employee reviewing the business without saying they work there |
| Fake independent review sites | A “best roofers in town” site you secretly run that ranks you first |
| Review suppression | Baseless legal threats to make someone take down a review, or hiding bad reviews on your site while implying you show them all |
| Fake social media signals | Buying followers, likes or views you knew or should have known were fake, to make your influence look bigger |
For fake reviews, the rule covers businesses that “knew or should have known” a review was fake. The Q&A has an exception for businesses “doing nothing more than hosting consumer reviews.” That changes once you reuse a review: put it in an ad or post it on your own site as a testimonial, and the Q&A says the hosting exception doesn’t apply, so check it’s real first. The table is a plain-language summary, not the full legal test; each ban has its own conditions in the rule.
What does the rule allow?
The FTC’s Q&A is clear on several everyday situations:
- Asking all your customers for reviews is fine.
- Asking a satisfied customer to update an old review is not prohibited.
- Incentives that don’t depend on sentiment aren’t banned by the rule, but the FTC says failing to disclose them could break the FTC Act. Most review platforms ban incentives anyway, so in practice, don’t.
- Family and staff reviews are allowed under the rule if the relationship is clearly disclosed. Google and Yelp treat these as conflicts of interest, so keep them off those sites.
What about asking only happy customers?
This is the main gray area. The FTC’s Q&A says the rule “does not contain a specific prohibition against such conduct. But this practice could violate the FTC Act.”
The FTC’s Endorsement Guides give an example: inviting only very satisfied customers to post reviews may be unfair or deceptive if it makes the overall reviews substantially more positive. Inviting all recent buyers isn’t deceptive, even if you hope for good reviews. Google and Trustpilot ban selective asking outright. Our guide to the rules on each platform has the details.
The safe practice: ask everyone, the same way.
What are the penalties?
The rule lets courts impose civil penalties for knowing violations. The FTC’s 2025 inflation adjustment set the maximum at $53,088 per violation. We understand the FTC kept the 2025 amounts for 2026, but couldn’t read the notice itself, so check the FTC’s site for the current figure.
Has the FTC enforced it?
Yes. In December 2025, the FTC sent warning letters to 10 companies about possible violations, including sentiment-tied incentives, undisclosed insider reviews and review suppression. In May 2026, the FTC and the State of Illinois took action against a company accused of creating thousands of fake home-repair business listings with fake reviews. Those are allegations; we found no ruling as of October 31, 2026.
What should a small business change?
- Stop any reward tied to reviews, even small ones.
- Ask every customer the same way, rather than picking the happy ones.
- Tell staff not to review the business. If anyone connected to you does review it somewhere, they must say so.
- Check your website’s reviews page. If you’ve left out bad reviews, don’t imply it shows all of them. See showing reviews on your website.
- Never threaten a reviewer with legal action to get a review removed. Report rule-breaking reviews to the platform instead.
- Check any marketing vendor. If someone offers “review generation” that sounds too good, ask exactly how it works.
Why does it matter?
Before the rule, the FTC could act against fake reviews under its general powers. The rule makes the bans specific and allows civil penalties for knowing violations. It applies whether reviews appear on your website or on other platforms.
What are the common mistakes and edge cases?
- AI-written reviews. Reviews from people who don’t exist, including AI-generated ones, count as fake.
- Staff “helping out” with a review. An insider review without disclosure breaks the rule.
- A review swap with another business. Neither of you is a real customer.
- Hiding reviews by delaying only the negative ones. The Endorsement Guides FAQ says to treat all reviews the same way.
- Using old fake reviews in ads. Testimonials in your ads are your responsibility.
What if this didn’t work?
- You’ve broken the rule in the past. Stop now, remove anything you control that’s fake, and get legal advice if you’re worried.
- A competitor is posting fake reviews. Report them to the platform, and to the FTC at ReportFraud.ftc.gov. See spotting and reporting fake reviews.
- A vendor sold you fake reviews. Stop the service and report the reviews.
How does E-3 handle this?
Our leads and follow-up service sends the same neutral request to every customer, with no rewards attached. Wording and reply drafts are prepared for you, checked by a person and approved by you. We can’t advise on your legal position; for that, ask a lawyer.
Related questions
Sources
- Federal Trade Commission Announces Final Rule Banning Fake Reviews and Testimonials (FTC, August 14, 2024)
- The Consumer Reviews and Testimonials Rule: Questions and Answers (FTC Business Guidance)
- Rulemaking: Use of Consumer Reviews and Testimonials (FTC)
- FTC's Endorsement Guides: What People Are Asking (FTC Business Guidance)
- 16 CFR 255.2, Consumer endorsements (Legal Information Institute)
- FTC Publishes Inflation-Adjusted Civil Penalty Amounts for 2025 (FTC)
- FTC Warns 10 Companies About Possible Violations of the Agency's New Consumer Review Rule (FTC, December 2025)
- FTC, Illinois Take Action to Stop Deceptive Conduct by Company That Created Thousands of Business Listings with Fake Reviews (FTC, May 2026)
Common questions
- Can my family review my business?
- The FTC's Q&A says yes, but ask them to clearly disclose their relationship to the business. Google and Yelp go further and treat it as a conflict of interest, so don't do it there.
- Am I responsible for fake reviews other people post about me?
- If you're doing nothing more than hosting reviews other people wrote, the FTC's Q&A says that's covered by an exception. Reusing a review in your ads or on your website makes it your testimonial, and the hosting exception no longer applies. Report fake reviews to the platform.
Next step
- Next: Facebook recommendations: how Page reviews work nowThe next guide in Reviews.
- Free website checkPublic checks on your own site, then an action plan of what to fix first.
Still stuck? Ask E-3 for an answer from our help guides.
Rather we handled reviews for you?
It’s part of what we do every week for small businesses, as part of leads and highlevel. Start with a free check of your site and profile, or call and ask.