FTC Enforces Against Fake News Internet Marketing

Another lesson in internet marketing law comes in the form of FTC’s latest settlement with two internet marketers.

The marketers ran an alleged internet marketing scheme involving the creation of fake news sites which were used to promote the effectiveness of weight loss drugs:

Under the settlement, the Copeac defendants will pay more than $1.3 million, which represents revenues they received from deceptive fake news site ads for acai berries, colon cleansers, and other supposed weight-loss dietary supplements; and revenues they received for other products marketed on fake news sites. The settlement also requires Copeac to monitor all its affiliate marketers when selling any good or service, obtain adequate information about the affiliate marketers it hires, approve their advertisements, and immediately stop processing payments generated by any affiliate marketer using deceptive advertisements.

In the second case, under the terms of the settlement with Coulomb Media, Inc., and Cody Low, also known as Joe Brooks, the defendants’ $2.7 million judgment will be suspended after they pay $170,000 in cash, proceeds from the sale of Low’s 2010 Chevrolet Tahoe, and a certificate of deposit.

The FTC has resolved that fake news sites would be going down.

It is interesting to note that such “deceptive practices” have long been unlawful in the non-internet setting. The relative ease with which internet technology allows users to set up real news lookalikes seems to help companies forget that internet advertising is governed by the same laws and regulations as its “real world” counterpart.