Supplement Company Receives Fraud Charges from FTC over Fake Paid Amazon Reviews
The first ever case of fraudulence on false paid Amazon reviews has been launched by the Federal Trade Commission of US. A supplement company paid dimes to a third-party website for writing deceptive reviews on Amazon to advertise one of their online products. Cure Encapsulations, Inc is the company in question. It is owned by Naftula Jacobowitz.
The fake reviews were bought for garcinia cambogia, a weight-loss supplement. A native plant of Indonesia, garcinia cambogia is given a misleading characteristic as a contributor to weight loss, but the truth is it is highly functional to cause acute liver failure.
The website, Cure Encapsulations has paid is amazonverifiedreviews.com. They were instructed to provide 4.3 to 5 Amazon rating with enticing reviews that show the supplement in the positive light. FTC did their research and has found the falsehood in those statements.
Andrew Smith, the consumer protection director of FTC, asserted that most people buy a product online believing in online reviews and ratings. But the rise of fake reviews and higher ratings on a bad product is hurting both the shoppers and the companies that play as per rules. On February 19th, the FTC has filed the first complaint. Just under a week, the settlement has reached.
According to the settlement, Cure Encapsulations is prohibited from endorsing products with misleading reviews even if it is from real customers. They now have to inform Amazon about their paid reviews which in itself a violation of the rules of Amazon around the promotional content. The company now also has to notify all the customers who have purchased the supplement.
There is $50,000 due today after the FTC imposed a $12.8 million fine on the supplement company for keeping them in check. The rest of the money is used for the enforcement of judgment if the company misinterprets about the money on hand.
