Back Up Your Claims Or Pay Up, Says The FTC To Advertisers

The FTC advises advertising to back up product claims.

Last week, the FTC warned 670 companies that unsubstantiated advertising claims might result in hefty penalties.

“The requirement for advertisers to have adequate support for their advertising claims at the time they’re made is a bedrock principle of FTC law,” said Sam Levine, director of the FTC’s Bureau of Consumer Protection, in a news release.

“The prospect of steep civil penalties will help ensure that advertisers don’t play fast and loose with the truth.”

The announcement says FTC regulation compels corporations to submit “reliable evidence” for product claims.

The agency said it has long advised companies on how to prove their claims, but many vendors still make unsubstantiated comments and deceptive claims about their proof.

“Consequently, the FTC is now using its penalty offense authority to remind advertisers of the legal requirement to have a reasonable basis to support objective product claims and to deter them from making deceptive claims in the future,” the release said.

The FTC stated the noticees sold over-the-counter medications, nutritional supplements, homoeopathic items, and functional foods. These companies might be fined up to $50,120 per violation if their assertions are unsubstantiated.

The commission’s website listed Bausch + Lomb, Bayer, CVS Pharmacies, Coca-Cola, and Gwyneth Paltrow’s Goop as the corporations.

The FTC stated that a company’s “inclusion on the list does not in any way suggest that it has engaged in deceptive or unfair conduct.”

The commission’s announcement came weeks after rumours that it sought to ensure AI businesses weren’t exaggerating their claims.

“Big companies could become bigger,” FTC Chair Lina Khan said at a Justice Department event in March, because machine learning requires a lot of data and storage.

The FTC investigated several bitcoin firms last year for false advertising.