If anyone ever offers to write a glowing fake review of your business online, beware: It could cost you your reputation—and even a hefty fine.
The New York attorney general’s office announced on Monday that it is fining 19 companies between $2,500 and $100,000 each after a yearlong investigation found that they wrote fake positive reviews on online review sites such as Yelp, Google Local, Yahoo and CitySearch. An undercover agent posing as a Brooklyn yogurt shop owner called up several Internet “search-engine optimization” consultants and asked for help in combating negative online reviews. Several of the firms contacted agreed.
The investigation found that many of these companies hide their identities by hiring freelance writers in far-flung locales like the Philippines, Bangladesh and Eastern Europe and paying them anywhere from $1 to $10 per review to pretend they are customers and post glowing remarks on review sites. Many of the companies use “IP spoofing” technologies to conceal their identities and create hundreds of bogus profiles. These firms violated multiple state laws against false advertising and engaged in illegal and deceptive business practices, a news release said.
"This investigation into large-scale, intentional deceit across the Internet tells us that we should approach online reviews with caution,” said New York Attorney General Eric Schneiderman. “And companies that continue to engage in these practices should take note: ‘Astroturfing’ [as this practice is called] is the 21st century's version of false advertising, and prosecutors have many tools at their disposal to put an end to it."
The investigation also found that many businesses have posted ads offering to pay people to write fake reviews on sites like Craigslist.com and Freelancer.com.
A few of the 19 companies being penalized aren’t Internet consulting firms—they’re businesses that asked their employees and even customers to write positive reviews. U.S. Coachways, a major bus charter company based in Staten Island, New York, hired freelance writers and offered $50 gift certificates to customers to leave glowing reviews without disclosing their payment.
The takeaway of the New York investigation is be careful. The issue of fake online reviews is getting more attention from government regulators and lawmakers and they’re starting to crackdown. (Here's a primer by Inc. on how to use online review sites to your advantage.) Also make sure any companies you hire to help you with social media and SEO aren’t engaging in such unscrupulous practices that could get you in trouble as well.
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