FTC Twitter Chat Addresses Recent Action Against Social Media Influencers and Updates to FAQs Blog Advertising & Marketing Law News

FTC Twitter Chat Addresses Recent Action Against Social Media Influencers and Updates to FAQs Blog Advertising & Marketing Law News

The chat addressed questions concerning the FTC’s recent updates to its FAQs on the Endorsement and Testimonial Guides. Some of the major takeaways included: (1) #XXPartner is likely a sufficient disclosure where XX is the advertiser’s name, (2) Currently the FTC does not think that the built-in disclosure tools on Facebook, YouTube, and Instagram are sufficient, and (3) the material connections disclosure should be clear, easy to understand, and separate from other hashtags and copy. They also made numerous social media posts stating the same. The FTC alleged that the respondents failed to clearly and conspicuously disclose that Martin and Cassell both had ownership interests in and held positions at CSGO Lotto and were using the service for free, which is a material connection between the two as influencers and the company. The FTC also took issue with CSGO Lotto’s use of other social media influencers, who were encouraged to “post in their social media circles about their experiences using CSGO Lotto.” The FTC alleged that CSGO Lotto did not require these influencers to disclose that they were being paid or provided free credits to play, and also prohibited the influencers from “making statements, claims, or representations...that would impair the name, reputation and goodwill” of the company. As a follow-up, 21 influencers received warning letters from the FTC about the influencer’s specified posts. The FTC’s letters asked each influencer whether they had a material connection to the brand shown in the post and, if so, why the influencer failed to comply with the Endorsement Guidelines by clearly and conspicuously disclosing such connection. The FTC also updated its FAQs on the Endorsement Guides, providing additional examples of scenarios that trigger material connections disclosures, including trading donations to charities for consumer interaction and sending influencers products to review. Finally, the revisions also indicated that the FTC obligations extend to foreign influencers if it is reasonably foreseeable that the endorsement will be seen by and effect US consumers.

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The Federal Trade Commission (FTC) recently took to Twitter for a live Q&A on influencer advertising. The chat addressed questions concerning the FTC’s recent updates to its FAQs on the Endorsement and Testimonial Guides. Some of the major takeaways included: (1) #XXPartner is likely a sufficient disclosure where XX is the advertiser’s name, (2) Currently the FTC does not think that the built-in disclosure tools on Facebook, YouTube, and Instagram are sufficient, and (3) the material connections disclosure should be clear, easy to understand, and separate from other hashtags and copy.

As a refresher, the FTC settled its first action against individual social media influencers after the FTC alleged the influencers violated Section 5(a) of the FTC Act by failing to disclose materials connections. The influencers, Trevor Martin and Thomas Cassell each had a YouTube channel primarily focused on online gaming and encouraged consumers to use CSGO Lotto’s gambling services. They also made numerous social media posts stating the same. The FTC alleged that the respondents failed to clearly and conspicuously disclose that Martin and Cassell both had ownership interests in and held positions at CSGO Lotto and were using the service for free, which is a material connection between the two as influencers and the company. The FTC also took issue with CSGO Lotto’s use of other social media influencers, who were encouraged to “post in their social media circles about their experiences using CSGO Lotto.” The FTC alleged that…

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