The U.S. Federal Trade Commission (FTC) has unveiled a new regulation aimed at addressing the proliferation of fake reviews and endorsements, with significant implications for the travel sector.
The rule, announced on Wednesday, seeks to penalize businesses engaged in the purchase or sale of counterfeit reviews and biased endorsements. This development comes as part of a broader crackdown on digital deceit, including fake reviews generated by artificial intelligence (AI), paid praise, and manipulated influencer endorsements.
The travel industry has long grappled with the issue of fake reviews. For over a decade, it has been a well-known practice among some hoteliers to use third-party services to artificially inflate their ratings or undermine competitors. These reviews can be purchased for a few dollars each or generated using sophisticated AI tools, which have further accelerated the problem.
Under the new FTC rule, businesses found guilty of such practices could face civil penalties of up to $51,744 per violation. The FTC plans to enforce these regulations within approximately two months.
The rule’s reach extends beyond the travel industry to include restaurants, online review platforms, travel agencies, hotel and short-term rental operators, social media influencers, and other entities involved in generating reviews. This comprehensive approach is designed to address the diverse range of services affected by deceptive review practices.
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