If you’re thinking of selling engagement for social media accounts, think again. It is officially illegal to sell likes, follows, and fake reviews and the FTC is ready to crack down on those who do.
The first case to go down in the FTC’s pursuit to end deceptive marketing tactics is the case of German Calas Jr. and his company, Devumi. Recently, the FTC reached a settlement with Calas for $2.5 million dollars, $250,000 of which he must pay while the remaining amount is deferred. This settlement is the culmination of an investigation that began with the New York Times about social media fraud back in 2018, and an example of what’s to come for social media fraudsters.
According to the investigation, the search for online popularity and influence is what allowed Devumi to thrive. With high profile clients like businesses, brands, and celebrities, the company made around $15 million in revenue from selling social media indicators. So what does $15 million look like in terms of social media metrics? According to the report, this consists of over 58,000 orders for fake Twitter followers, over 4,000 orders for fake YouTube subscribers, 32,000 fake YouTube views sales, and more than 800 fake LinkedIn followers. All of this made possible by 3.5 million bots, whose design was made to mimic real online accounts by including data such as names, photos, geographical locations, and more of actual Twitter users. This ads an extra level of concern since, companies that purchase these services are not only encouraging fraud, but also identity theft.
The FTC also took action against Sunday Riley, a well-known skincare brand, for misleading its potential customers through fake reviews on the Sephora website where Sunday Riley products are also sold. Upon CEO, Sunday Riley’s request, employees were allegedly instructed to post fake reviews highlighting the positive attributes of Sunday Riley products, as well as negative reviews for competitor brands.
According to a Buzzfeed article, “The complaint alleges that in a July 2016 email, [CEO Sunday] Riley instructed her staff to each create three different accounts on Sephora’s website using different identities, and to use VPNs to mask their identities. To do so, she allegedly told employees to make up names, cities, and skin types for these new personas and set up fake email accounts for each one”
For Sunday Riley, the consequences of committing social media fraud aren’t comparable to those of Devumi since Sunday Riley’s settlement did not require a fine. The brand simply was ordered to discontinue their fraudulent practices. As having a digital presence becomes increasingly necessary for brands and businesses to survive, it is important for cases like these to set an example of how engaging in illegal, fraudulent activity will not be tolerated and will be reprimanded.
Hopefully, as the FTC shows that these cases will be taken seriously, sellers and purchasers will think twice before continuing to engage in sketchy practices. While Devumi and Sunday Riley are steps forward in the battle towards a more transparent digital industry, there is still a long way to go that will require the contributions of many, including social media platforms and its users.