That US online casino top list position is fake. Now, it’s also illegal

This October, the Federal Trade Commission (FTC) implemented a new rule banning fake reviews and testimonials, titled “Rule on the Use of Consumer Reviews and Testimonials.” With the new rule in effect, the FTC has published strict guidelines that US online marketers must follow. Those who do not comply and are found using deceptive marketing practices, including fake reviews, risk penalties and other legal repercussions. 

According to the Public Interest Research Group (PIRG), around 30-40% of all online reviews are fake. The rate of fabricated reviews can vary widely depending on the source. Reviews on Google, Yelp, Facebook, Tripadvisor and Amazon, for example, are commonly targeted and are the basis for data points in fraud research. 

The igaming industry has yet to be extensively studied, but Magnus Boberg, managing director of JustGamblers, visits igaming affiliate websites daily to conduct market research. He regularly encounters fake reviews and bought listings, noting that although proving wrongdoing is difficult, there is rarely evidence of affiliates having real, substantial experience with an online casino or sportsbook that warrants their recommendations. 

However, the absence of evidence is not evidence of absence (of fraud or wrongdoing). While most research and countermeasures to fake reviews target marketplaces like Amazon and general consumer sites like Yelp, it doesn’t mean affiliates from the igaming industry can continue operating outside the new FTC guidelines. 

Key takeaways of the new FTC rule 

• Fake or false consumer reviews, testimonials and celebrity endorsements: This regulation prohibits misrepresenting the identity of reviewers, such as using AI-generated fake reviews, and bans the creation, sale or dissemination of misleading reviews or testimonials. Businesses are not allowed to use testimonials that they knew or should have known were false or fabricated. 

• Ban on buying positive or negative reviews: Businesses are explicitly forbidden from offering incentives conditioned on writing consumer reviews expressing a specific positive or negative sentiment. This rule ensures that consumer feedback remains honest and free from undue influence. 

• Disclosure requirements for insider reviews and testimonials: Reviews provided by company insiders, such as officers or managers, must disclose the individual’s material connection to the business. Companies are also prohibited from using insider testimonials they should have known about, and transparency is required when soliciting reviews from employees or relatives. 

• Misrepresentation of company-controlled review websites: Businesses cannot misrepresent company-controlled websites as independent review platforms. This regulation protects the integrity of review systems and fosters consumer trust. 

• Review suppression practices: Companies are banned from suppressing negative reviews through unfounded legal threats, intimidation or false public accusations. Additionally, businesses cannot misrepresent the reviews displayed on their platforms as representative of all submitted feedback when negative reviews are intentionally hidden. 

• Misuse of fake social media indicators: The sale or purchase of fake social media indicators, such as bot-generated followers or views, is prohibited when the parties involved knew or should have known they were fake. This rule ensures businesses cannot misrepresent their influence for commercial advantage. 

While the FTC’s jurisdiction is limited to the US, the rule will likely impact international markets. Considering that issues around fraudulent marketing are not isolated to the US, the FTC’s regulations could impact legislative bodies worldwide, where we see a globally consistent approach to combating deceptive online marketing tactics. 

Moving forward, igaming affiliates should audit their practices to ensure compliance with the FTC's new guidelines on review management and stay informed on policy updates and enforcement. Team members should be educated about the new regulations and strive to promote organic and authentic feedback. To avoid penalties, sites that rely on user-generated content should monitor for suspicious activity and moderate feeds. 

A step in the right direction 

More and better reviews translate directly into online visibility and revenue, incentivising businesses to push for positive reviews and listings, regardless of whether they’re authentic or fabricated. Boberg emphasises the importance of central guidelines to counteract deceptive marketing practices and improve transparency and integrity in our high-value industry – a step in the right direction.  

In cases of bad actors, consumers shoulder the costs of these frauds. In the long term, we will likely see greater regulatory oversight, making it more complex to operate due to added administration and compliance. 

In the short term, I expect affiliates to comply with the new rules, considering that the FTC can now seek penalties against known violators. This will force everyone to operate with greater transparency and provide proof of authenticity. 

Outcome and future of igaming affiliate reviews 

The FTC fake review ban comes at a critical time. The internet has become flooded with trash, and artificial intelligence has supercharged web publishers and loiterers. The new rules mark a significant milestone, and we can expect a healthier online marketing landscape: 

• Improved consumer trust: Stricter regulations against fake reviews will allow consumers to rely on more authentic and accurate feedback, fostering greater confidence and trust. This shift will benefit affiliates that prioritise genuine experiences. 

• Diverse content: Affiliates can find new ways to collect and present feedback and experiences, such as interactive surveys, video testimonials or advanced review algorithms designed to verify authenticity, improving the overall quality of reviews for user-generated content. 

• Verified purchases: Reviews tied directly to verified purchases are expected to become a cornerstone of trust for general products. In igaming, this can add another layer of credibility to reviews and recommendations. 

• Social proof: Affiliates may increasingly incorporate alternative forms of social proof, such as user-generated photos, videos and real-time customer testimonials, to build trust without relying solely on written reviews. These forms of content add depth and authenticity to consumer trust-building efforts. 

• Global consistency: As the FTC’s actions gain international attention, there may be a push for harmonised standards in review practices across the global online marketing landscape, creating a more consistent and safe environment for consumers worldwide. 

By focusing on genuine feedback based on real experiences and adhering to best practices guided by the FTC, affiliates can comply with the new regulations while building stronger and more sustainable businesses.