This month, the Federal Trade Commission (“FTC”) announced that it reached a settlement with the operators of a website that compares student loans and other financial products over allegations of misleading ratings and reviews.

According to the FTC’s complaint, LendEDU falsely claimed that its website provided “objective,” “accurate,” and “unbiased” information about consumer financial products, including student loans, personal loans and credit cards. Specifically, LendEDU misrepresented that the information on its website was not affected by compensation from advertisers. However, the FTC alleged that, in fact, the company sold its rankings to the highest bidder.

In addition, the complaint alleged that LendEDU touted fake positive reviews on its website. The FTC argued that of 126 reviews posted on third-party review platform, 90% “were written or made up by LendEDU employees or their family, friends or other associates. All of those reviews provided five-star ratings for the company.”

Under the terms of the settlement, LendEDU will need to (i) pay to the Commission a $350,000 fine; (ii) refrain from making the same types of misrepresentations cited in the FTC’s complaint in the future, express or implied; and (iii) disclose any compensation that it receives for featuring content on its site.

Takeaway: This settlement highlights the FTC’s continued interest in policing fake reviews and pay-to-play rankings. Advertisers should ensure that reviews are honest based on actual experiences with the products and services, and that if incentivized, the reviews will disclose the relationship between the reviewer and the advertiser.