In this week’s episode, I’m sharing some breaking news about a massive $20 million fine assigned to an auto dealer group in Illinois. Just last fall, the FTC released new laws making fake reviews illegal, and we knew it wouldn’t be long before they made a public example. At the end of December, they made that example… Watch the video for all the details.
VIDEO TRANSCRIPT
Welcome back to another episode of Local Search Tuesdays. This week, I’m sharing some breaking news about a massive FTC fine due to fake reviews.
Back in September, I released an episode that shared the news about the updates to the FTC laws around fake reviews and engagement. Now that fake reviews were made illegal at the federal level, we all knew it wouldn’t be long until the FTC made a very public example of the new laws.
Turns out, it only took a few months. At the end of December, the Leader auto group in Illinois was charged a massive $20 million fine. This is the largest fine the FTC has ever levied against car dealerships.
There were three main things that got them in trouble. First, they were fined for bait-and-switch practices because they “required” thousands of dollars of fake fees with every purchase, so the advertised price was several thousand dollars short of the actual purchase price.
They also got in trouble for selling cars that were manufactured in Canada without letting customers know. Even when that’s done legally, it typically voids the manufacturer warranty, so obviously it’s a lot worse when they didn’t tell customers.
And finally, they got busted for fake reviews. Apparently, management required employees to post fake reviews for the dealership. They even withheld bonuses and other compensation from employees who didn’t post fake reviews and even paid employees extra to leave fake reviews.
Apparently, they also bullied customers into posting five-star reviews – in one documented case, they refused to give a customer the keys to the car she had purchased until she posted a positive review.
Both the FTC and Google are cracking down on fake reviews – if you’re still posting fake reviews, you’re in super dangerous waters. The juice just isn’t worth the squeeze.
That’s all the time we have left for this week’s episode, so you know what that means.
Put your hand on the screen right here:
We totally just high-fived ‘cause you learned something awesome. Thanks for watching, and we’ll see you again next week for another episode of Local Search Tuesdays.
