MEASURE TO PROTECT BUSINESSES AND CONSUMERS FROM FAKE REVIEWS RECEIVES PUBLIC HEARING

Posted: January 21, 2014 | Senator Boyle

Senator Boyle sponsors bill to ban the deceptive practice of “astroturfing”

AUGUSTA—Democratic Senator Jim Boyle of Gorham introduced a measure today to protect small businesses and consumers from fraudulent and fake reviews by amending the Uniform Deceptive Trade Practices Act.

 

“In today’s economy, online reviews are a critical part of word-of-mouth buzz for businesses. Fake negative reviews can harm our small businesses, and this deceptive practice should be banned,” said Senator Boyle. “Our small businesses are the backbone of our economy, particularly in Maine’s tourism industry. Fake reviews that damage our businesses damage our economy.”

 

There are confirmed cases where companies have hired people to post fake reviews, either praising their own company, or disparaging a competitor’s business, on user-generated review websites, such as Yelp.

 

A 2011 Harvard Business School study found that a one-star rating increase on Yelp was tied to a 5 to 9 percent increase in revenue for a restaurant, and researchers at Cornell found that a one-star swing on Travelocity and TripAdvisor resulted in an 11 percent variation in room rates.

 

“Deceptive ads amount to nothing more than duping consumers,” added Senator Boyle. “If there’s a way to avoid intentionally misleading consumers, then it is our responsibility to do so.”

 

The Labor, Commerce, Research and Economic Development Committee will hold a work session on the bill, LD 1659, “An Act to Amend the Uniform Deceptive Trade Practices Act,” later this session.

 

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