It’s Business, And It’s Personal

Understanding deceptive and unfair advertising

| Jul 12, 2021 | Uncategorized |

Advertising and marketing claims must be truthful, cannot be deceptive or unfair and must be evidence-based. The Federal Trade Commission (FTC) sets out advertising guidelines to protect consumers.

Deceptive and unfair ads

According to the FTC, an ad is deceptive if it contains a statement or omits information that is likely to mislead consumers acting reasonably under the circumstances and is material, which means that it is important to the consumer’s decision to buy or use the product. An ad is unfair if it causes or is likely to cause substantial consumer injury and is not outweighed by the benefit to consumers.

The FTC looks at the ad from the consumer’s point of view in terms of its words, phrases and pictures to determine its messaging to the consumer. It also looks at the express and implied claims the ad makes, which may include representations about the product’s performance, safety, price or effectiveness. Advertisers are required to have proof to support these claims.

The FTC also reviews if the advertiser failed to include information that would leave a consumer with a misimpression about the product.

Penalties

The penalties for deceptive and unfair ads can vary. The advertiser may be subject to civil penalties and may be ordered to give full or partial refunds to all consumers who bought the product. They may also be required to take out new ads to correct the misinformation.

Consumers may have additional remedies including pursuing monetary compensation for the harm they suffered as a result of the deceptive or unfair advertising. An experienced consumer protection attorney can provide advice and answer questions about these advertising claims.

 

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