Bloggers Beware - FTC Toughens Endorsement Rules!

[This post is written and copyrighted by FIRE Finance (]

Today we came across this story at Nasdaq which talks about how FTC (Federal Trade Commission) has revised its rules regarding endorsements of products by bloggers and celebrities.
Under revised rules announced Monday (Oct 5, 2009), the FTC will require bloggers and celebrities to clearly state when they receive cash or "payment in kind" for endorsing a company's products or services.

The changes, adopted on a 4-0 vote, are the first revisions to federal guidelines on endorsements and testimonial advertising since 1980 and the first to target bloggers.

Connections between advertisers and endorsers must be disclosed once the revised guidelines take effect on Dec. 1. The FTC said the stricter disclosure requirement will apply to comments on talk shows, blog posts and on social media as well as in traditional advertisements.

Corporations also face stricter standards. Under the revised guidelines, if a company's advertisement refers to findings of corporate-sponsored research, the ad must disclose the link between the company and the research organization.

Advertisers and endorsers who fail to disclose material connections, or who make false, misleading or unsubstantiated claims may be subject to fines of $11, 000 per violation.


Consumers who use their money to buy a product and then praise it on a personal blog or Internet message board won't be subject to the guidelines, the FTC stressed.

But bloggers who endorse a company, product or service because they are paid by the firm or by a third party would have to come clean about the relationship.
Well that is good news since it will reduce noisy and irrelevant information. Perhaps we will end up having a cleaner and more honest web :).

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