FTC Can Fine Bloggers $16,000

Bloggers sometimes make money on endorsements, so this will hurt them. (Image Credit: BBC News)

Update:  It’s now $16,000 maximum, according to another source.

You read that right! Bloggers can now be fined by the FTC up to $16,000 if they fail to report when they are being paid by a company to review products. For the first time since 1980, the FTC has updated its “Guide Concerning the Use of Endorsements and Testimonials.”

“….bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service. And a paid endorsement – like any other advertisement – is deceptive if it makes false or misleading claims.” (Federal Trade Commission Oct. 5, 2009).

In the past it was not specifically stated that an endorser or advertiser could be held liable for false or misleading statments.

You can find more information on the FTC website.

This is all well and good but I am wondering how this will be enforced. Will they randomly check blogs to see if they are endorsing products and if so, how will they know the company paid for the endorsement or the blogger is simply doing it because he or she likes it? If the blogger is not getting paid, does that absolve him or her of any liability?

I know Chris Pirillo routinely evaluates, reviews and sometimes endorses products from various companies, though I am unsure if he gets paid to do so. Regardless, it is definitely something to be aware of anytime you want to post about a product or service.