Keep Watch Over Your Social Media Influencers and Posters Tactics
(October 28, 2019) Make sure the tactics used by your social media influencers and product reviewers are not deceptive and the posts are accurate, or the Federal Trade Commission (“FTC”) may come knocking. Two recent cases by the FTC emphasize this point.
In the first, the FTC found Devumi, LLC and its owner engaged in deceptive practices when it sold fake Twitter follower accounts, fake YouTube subscribers, and fake LinkedIn followers to actors, athletes, musicians, public relations firms, law firms, financial services companies, and others, which allowed the purchasers to exaggerate and misrepresent their social media influence.
For example, the FTC noted that musicians bought fake YouTube subscribers and views “to deceive potential viewers and potential music purchasers.” For law firms, financial services companies, and other professionals, Devumi sold fake Twitter followers, allowing the professionals “to deceive their potential clients about their influence, whether clients were seeking to hire them as influences or to hire them for other services.”
In an agreed order with the FTC, the now defunct Devumi and its owner are banned from selling or assisting others in selling social media influence to users of third party social media platforms. The order imposed a $2.5 million monetary judgement against Devumi’s owner.
The second case was brought against Sunday Riley Skincare, which sells a variety of cosmetic products at Sephora stores and on the Sephora.com website. The website allows customers to leave reviews of its products.
Apparently not happy with the reviews, managers and Ms. Riley herself, directed Sunday Riley staff to “create three accounts on Sephora.com” using different identities to give certain products five-star ratings and to “dislike” negative reviews. To help the staff, Ms. Riley sent a memo to the staff on how to create new personas, set up new gmail accounts, clear their cookies before posting, and use only a company-provided virtual private network to hide their online activities.
The Sunday Riley staff members were so enthusiastic that one employee wrote a favorable review a day after a product was launched. The company ironically admitted in an email to other employees that “it was a little pre-mature as the product only launched yesterday and won’t have arrived same day. Credibility is key to the reviews!”
Sunday-Riley agreed to a settlement prohibiting it from posting fake reviews in the future.
Balough Law Offices has assisted clients in creating agreements with influencers to ensure that the influencers and posters abide by the FTC guidelines and not post deceptive or false statements.
Federal Trade Commission v. Devumi, LLC and German Calas, Jr., S.Dist.Fla., 19 CV 81419-RKA, filed Oct. 18, 2019.
In Matter of Sunday Riley Modern Skincare, LLC and Sunday Riley, FTC Docket No. C-4689, Oct. 21, 2019.