False Advertising Examples: What Four FTC Texts Name as Deceptive

Four kinds of false advertising are spelled out in federal texts: bait and switch, a "free" offer that is not free, an unqualified "Made in USA" claim that is not true, and fake reviews. Each has its own part of the Code of Federal Regulations, and the examples below follow that text.

This is general information, not legal advice. Parts 238 and 251 are guides, and Parts 323 and 465 are rules whose texts call a violation an unfair or deceptive act or practice Source [3]Source [4]. We did not review state laws or court cases, and a single page cannot cover every part in full.

Autonomah studies what the competition says and what it leaves unsaid Source [6].

Bait and switch

The guide defines bait advertising as an alluring but insincere offer to sell a product or service that the advertiser does not intend or want to sell, whose purpose is to switch consumers to something else, usually at a higher price Source [1]. Its first rule is that no advertisement containing an offer to sell a product should be published when the offer is not a bona fide effort to sell it Source [1].

The guide lists acts it will consider in deciding whether an offer is bona fide Source [1]:

• Refusing to show, demonstrate or sell the advertised product on the terms of the offer Source [1].
• Disparaging the advertised product or its guarantee, credit terms or availability of service Source [1].
• Not having enough of the product at the outlets the ad lists, unless the ad clearly discloses that supply is limited Source [1].
• Showing a defective or unusable product, or using a pay plan that discourages salespeople from selling the advertised one Source [1].

It also names a switch after the sale, such as accepting a deposit for the advertised product and then switching the buyer to a higher-priced one Source [1].

A "free" offer with strings

The "Free" guide says such offers must be made with extreme care to avoid any possibility that consumers will be misled Source [2]. A buyer has a right to believe the seller will not recover the cost of the free item by marking up the item that must be purchased, or by substituting inferior goods Source [2].

Its other points Source [2]:

• All the terms and conditions should be set out clearly and conspicuously at the outset, in close conjunction with the offer, and a footnote reached by an asterisk does not count Source [2].
• A "Free" offer on a new product should end after a limited time, and the seller should expect in good faith to then sell the product at the same price it promoted Source [2].
• A single size of a product should not be advertised with a "Free" offer in a trade area for more than 6 months in any 12-month period, and no more than three such offers should run in the same area in 12 months Source [2].
• Swapping in words like "gift" or "bonus" does not fix an offer that fails these rules Source [2].

Our guide to fake sale prices covers the pricing guide that sits next to this one.

A false "Made in USA" label

The labeling rule says it is an unfair or deceptive act or practice to label a product as Made in the United States unless three things hold: the final assembly or processing happens in the United States, all significant processing happens in the United States, and all or virtually all ingredients or components are made and sourced in the United States Source [3]. The rule defines the claim broadly: any unqualified representation, express or implied, that a product is of U.S. origin, including "made," "manufactured," "built," "produced," "created" or "crafted" in the United States Source [3]. A violation is treated as a violation of a rule under section 18 of the FTC Act Source [3]. The rule leaves state laws in place when they give consumers more protection Source [3].

Fake reviews and followers

Part 465 makes it an unfair or deceptive practice for a business to write, create or sell a consumer review, consumer testimonial or celebrity testimonial that materially misrepresents that the reviewer exists, that they used the product, or what their experience was Source [4]. It also covers:

• Giving compensation or incentives in exchange for reviews that express a particular sentiment, positive or negative Source [4].
• An officer or manager writing a review of their own business without a clear and conspicuous disclosure of their relationship Source [4].
• Using an unfounded legal threat, a physical threat, intimidation or a public false accusation, made knowing it was false or with reckless disregard for the truth, to stop or remove a review Source [4].
• Selling or distributing fake indicators of social media influence, such as followers or likes generated by bots, that the seller knew or should have known were fake and that can be used to materially misrepresent influence or importance for a commercial purpose; and buying or procuring fake indicators that the buyer knew or should have known were fake and that materially misrepresent influence or importance for a commercial purpose Source [4].

Our guides to the FTC Endorsement Guides and the FTC influencer guidelines cover the older rules on endorsements.

What they have in common

The FTC's 1983 policy statement lists practices found misleading or deceptive in specific cases: false oral or written representations, misleading price claims, bait and switch techniques and failure to perform promised services, among others Source [5]. It states the test as a representation, omission or practice that is likely to mislead the consumer acting reasonably in the circumstances, to the consumer's detriment Source [5].

A check before you publish a claim

The checklist below is ours; none of the texts asks for it.

1. For each factual claim, name the record that would prove it today.
2. For an offer, confirm the item is in stock, on the stated terms, and can be delivered in a reasonable time.
3. For "free," put the conditions next to the offer, not in a footnote.
4. For an origin label, list where each step and each component comes from.
5. For reviews, use only reviews from real customers, and pay for none of them to say something in particular.

When a brand asks for a one-off piece, Autonomah prepares it, or explains with arguments why it is better not to publish it Source [6].

How Autonomah does it

Autonomah is an artificial creative and advertising brain that thinks, creates and publishes each brand's advertising Source [6]. Its automated checks include whether what a piece claims is backed up and the advertising rules of the industry and the country, and what does not pass is redone Source [6]. See how an Autonomah brand starts.

Frequently asked questions

What is an example of false advertising?

Bait advertising is one: advertising a product the seller does not intend or want to sell, to switch buyers to something else, usually at a higher price Source [1].

Can I say "Made in USA" if I assemble the product in the United States?

Assembly alone is not enough under the labeling rule. Final assembly or processing, all significant processing, and all or virtually all ingredients or components must be in the United States Source [3].

Is buying followers false advertising?

Part 465 says it is an unfair or deceptive practice to purchase or procure fake indicators of social media influence that you knew or should have known were fake and that materially misrepresent your influence or importance for a commercial purpose Source [4].