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FTC Guidelines Fallout

By Jonathan Bick
December 18, 2009

The regulations that the Federal Trade Commission (“FTC”) recently promulgated on product endorsements could result in injunctions for bloggers and advertisers, who could be ordered to reimburse consumers for financial losses stemming from product reviews that are considered inappropriate under the new guidance. The fines can reach up to $11,000 per violation.

The FTC action is in response to blogging used to market products and services online, but unbeknown to consumers, companies may compensate blogger-reviewers for their write-ups. Traditional journalism outlets normally bar their writers ' full-time and part-time staffers, as well as freelance contributors ' from accepting such compensation on the assumption that payment from a news or other type of information source presents at least the appearance of a conflict of interest and taints the treasured objectivity and fairness for which most journalism enterprises strive to present and to establish, along with the concomitant credibility with readers, viewers and listeners that such balance has traditionally established and nurtured.

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