FTC settles with app PR firm over ‘misleading online endorsements’ | iLounge News

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FTC settles with app PR firm over ‘misleading online endorsements’

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By Charles Starrett

Contributing Editor
Published: Friday, August 27, 2010
News Categories: Apps + Games, Other

The Federal Trade Commission has announced that it has reached a settlement with Reverb Communications, Inc. and its sole owner, Tracie Snitker, over what it claimed were deceptive advertising practices. According to the FTC’s announcement, the Commission believes that Reverb “engaged in deceptive advertising by having employees pose as ordinary consumers posting game reviews at the online iTunes store, and not disclosing that the reviews came from paid employees working on behalf of the developers.” The allegedly phony reviews were posted by Reverb and Snitker between November 2008 and May 2009 on the pages of the company’s client’s games. “Companies, including public relations firms involved in online marketing need to abide by long-held principles of truth in advertising,” said Mary Engle, Director of the FTC’s Division of Advertising Practices. “Advertisers should not pass themselves off as ordinary consumers touting a product, and endorsers should make it clear when they have financial connections to sellers.”

Snitker denies the charges, telling Kotaku that the issue was “specific to a handful of small, independently developed iPhone apps that several team members downloaded onto their personal iPhones in their own time using their own money and accounts, a right and privilege afforded to every iPhone and iTouch user. This was neither mandated by Reverb nor connected to our policies.” As part of the proposed settlement, Reverb and Snitker must remove any “previously posted endorsements that misrepresent the authors as independent users or ordinary consumers, and that fail to disclose a connection between Reverb and Snitker and the seller of a product or service.”

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