California Company Settles Charges of False iTunes Reviews

How much faith can you put in online reviews?

A recent settlement suggests you may have reason to be wary.

A California marketing company settled charges that it engaged in deceptive advertising by getting its employees to write favorable reviews of clients' games on the Apple (AAPL) iTunes Store, The New York Times reported. The reviews did not mention that the authors were being paid to write approving comments.

This was the first case brought under new guidelines for Internet endorsements. The idea behind the rules is to bring the same standards of truth-in-advertisement to the Internet that exists elsewhere.

Under the terms of the settlement, Reverb Communications and one of its staff, Tracie Snitker, agreed to remove all of the iTunes reviews that appeared to be written by ordinary people, but which were in fact written by staff.

Reverb and Ms Snitker are also barred from making any similar endorsement without full disclosure. There were no monetary penalties.

"We hope that this case will show advertisers that they have to be transparent in their practices and help guide other ad agencies," said Stacey Ferguson, a lawyer who works for the trade commission's Bureau of Consumer Protection.