UK CMA Directs Facebook to Sell GIPHY

UK’s CMA Investigates Amazon and Google for Potentially Fake Online Reviews

Are the companies doing enough to stop false and misleading reviews?

Last Friday, the United Kingdom’s Competition and Markets Authority (CMA) opened an official investigation into potential fake reviews on Amazon and Google. The CMA is looking into whether Amazon and Google have broken any consumer laws by not taking sufficient actions to protect shoppers from false or misleading reviews. Such reviews can have a significant impact on how a business is featured online and how a consumer perceives the products of individual businesses.

The CMA wants to know if Amazon and Google have adequate internal systems, processes and procedures in place for identifying and handling potentially fake reviews. Their investigation is focused on three primary areas:

  • Identify fake and misleading reviews or suspicious behavior. This could be any range of circumstances including the same users reviewing unrelated products and businesses when there is no apparent connection, or where the reviewer may have received payment or another incentive in exchange for the review on Amazon or Google.
  • Investigate and promptly remove false and misleading reviews on Amazon or Google.
  • Impose reasonable sanctions on reviewers and businesses to deter them from posting false or misleading reviews on Amazon or Google.

The CMA is also concerned that Amazon’s procedures do not properly identify and prevent sellers from manipulating product listings which may show misleading reviews for other products.

Andrea Coscelli, the CMA’s Chief Executive, said:

“Our worry is that millions of online shoppers could be misled by reading fake reviews and then spending their money based on those recommendations. Equally, it’s simply not fair if some businesses can fake 5-star reviews to give their products or services the most prominence, while law-abiding businesses lose out,” said Coscelli in a June 25, 2021 news release.

“We are investigating concerns that Amazon and Google have not been doing enough to prevent or remove fake reviews to protect customers and honest businesses. It’s important that these tech platforms take responsibility and we stand ready to take action if we find that they are not doing enough,” Coscelli added.

The UK's CMA is investigating whether Amazon and Google are doing enough to stop false and misleading online reviews.
Image: Bigstock Photos

Follow-up to initial May 2020 probe

This investigation is a follow-up to an initial probe launched by the CMA in May 2020 which looked into whether “several major websites” that display customer reviews were doing enough to ensure that their online reviews were not fake or misleading consumers. At that time, the CMA was not alleging that any websites were acting illegally. Instead, the CMA was specifically investigating:

  • Suspicious reviews
  • Whether businesses were manipulating the presentation of reviews about their products and services
  • How the “major websites” handle reviews, including whether reviewers were compensated for their reviews

Andrea Coscelli, Chief Executive of the CMA, said:

“Most of us read online reviews to help decide which products or services to buy. During lockdown, we’re more dependent than ever on online shopping, so it’s really important that the online reviews we read are genuine opinions. If someone is persuaded to buy something after reading a fake or misleading review, they could end up wasting their money on a product or service that wasn’t what they wanted,” said Coscelli in a May 22, 2020 news release.

“Our investigation will examine whether several major websites are doing enough to crack down on fake reviews. And we will not hesitate to take further action if we find evidence that they aren’t doing what’s required under the law,” Coscelli added.

Next steps

Since the CMA is early in its investigation, it is too soon to tell if sanctions would be imposed, based on the investigation’s findings. If, however, the CMA believes that Amazon and Google have broken laws designed to protect consumers, it may take enforcement action.

Insider Take

Have you ordered an online product that included a note from the seller that said you’d get a discount or other incentive if you leave a review online? I’ve gotten a number of these, and I always throw them away. This is just one way businesses can boost their ratings to increase sales and to secure better placement on ecommerce sites. These sellers should be disclosing that they were compensated for their review.

While it seems like a huge undertaking to police all reviews, Amazon and Google are technology companies at their core. It seems they have all the know-how at their fingertips to identify and prevent false and misleading reviews and to sanction sellers and reviewers for any misdeeds. We anticipate this investigation will take some time, but if the CMA finds that Amazon and Google have work to do on their end, this could set a precedent in other jurisdictions. Amazon and Google are already under the antitrust microscope in several countries. While this is not an antitrust issue, it certainly doesn’t help their cause.

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