Retailers want to think twice before removing negative reviews from their website.
The Federal Trade Commission said Tuesday that Fashion Nova, a popular fast-fashion clothing site, would have to pay $ 4.2 million to settle reviews that it had suppressed customer reviews that gave products less than four out of five stars.
The agency said this was the first case involving the company’s efforts to hide negative reviews.
Fashion Nova used a third-party product review system that keeps lower-star reviews for approval before they can be posted, the FTC said in the complaint. In early 2015 and late 2019, Fashion Nova automatically posted four- and five-star reviews on its site but did not approve or publish thousands of lower-star, more negative reviews, according to the complaint.
Terry Feh, a lawyer for Fashion Nova, said in an emailed statement that the FTC was “inaccurate” and that the company was “extremely confident” it would have won in court and agreed to settle the case with only disruption and fees.
While e-commerce is booming, especially during epidemics, the ecosystem of online reviews remains relatively crude. The FTC has in recent years asked police companies, such as the skin-care brand Sunday Relay, to post fake reviews online, although this is the first instance of the agency’s challenging “review suppression”.
These actions by the FTC serve as a warning signal to other companies. The agency said Tuesday it has sent letters to 10 companies that provide review management services, telling them they cannot avoid collecting and publishing negative reviews.
Fashion Nova said the problem was due to its reliance on the seller and the confusion associated with the “autopublish” feature for a certain star rating.
Reviews that were not self-published can be handled individually and released manually. Said Mr. Fahn. He said that Fashion Nova solved this problem as soon as it was informed in 2019 and unpublished reviews have been posted since then.
In addition to fines, Fashion Nova is prohibited from misrepresenting customer reviews or other endorsements.
“The deceptive review practice deceives consumers, undermines honest businesses and pollutes online commerce,” Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said in a statement.