A company that sold “ineffective” fat-fighting herbal supplements is facing a $12.8m (£9.6m) fine for allegedly buying fake reviews on Amazon.
The fine is part of a settlement deal Cure Encapsulations has reached with the US Federal Trade Commission (FTC).
Cure had paid a now defunct website for positive reviews to push claims its pills helped weight loss, said the FTC.
The company has also been told to stop making “false and unsubstantiated” claims about one supplement.
Cure Encapsulations makes pills it claims can be used to lose weight, using extracts made from the rind of a tropical fruit called Garcinia cambogia – a variety of tamarind.
But US research suggests such supplements have caused “acute liver injury” in some people who took them regularly. And US government advice suggests they have “little or no effect” on weight loss.
The FTC said Cure had spent significant sums to get positive reviews on Amazon that had been “fabricated” to seem as if they had come from actual customers.
And it had specified they must:
- claim the pills “block” fat and cause “significant weight loss”
- result in the supplement being given a five-star rating, to bump up sales
The settlement demands Cure Encapsulations contacts former customers, passing on official doubts about the efficacy of its products.
It has also been told to seek “competent and reliable” scientific evidence for any health-boosting claims it makes in the future for Garcinia-based supplements.
A US judge must now rule on whether the settlement is an appropriate remedy for Cure’s conduct.
The proportion of the $12.8m fine the company would actually end up paying depended on how much cash it had at its disposal, the FTC said.
“People rely on reviews when they’re shopping online,” said Andrew Smith, head of the FTC’s consumer protection division, in a statement.
“When a company buys fake reviews to inflate its Amazon ratings, it hurts both shoppers and companies that play by the rules.”
The case is the first FTC settlement deal to centre on fraudulent Amazon reviews.
In a statement, Amazon said it “welcomed” the FTC’s action and invested “significant resources” in protecting reviews.
“Even one inauthentic review is one too many,” it said.
Cure Encapsulations has yet to respond to a uphindia News request for comment.