Consumer Group Asks FTC to Enforce Influencer Disclosure

Public Citizen sent a letter to the FTC asking them to take action against the influencers who are still not disclosing sponsored posts on Instagram.

Brecken Branstrator brecken.branstrator@nationaljeweler.com

Washington, D.C.--It appears the letters the Federal Trade Commission recently sent to influencers warning them about sponsored internet posts didn’t help, and one consumer advocacy group wants the commission to take action.

In April, the FTC sent letters to more than 90 influencers and advertisers, reminding them to disclose any relationships they might have with brands when they’re promoting them on social media.

It marked the first time that the commission went after individuals--rather than entire companies or brands--and came as the number of celebrities and influencers getting into the gray area of sponsored posts continues to increase.

But, it appears that not many of the letter recipients are listening.

An investigation by Public Citizen’s Commercial Alert into the Instagram accounts of the 46 influencers who received the letter found that only one accurately and consistently complied.

From May 1 to June 12, Public Citizen tracked the influencers’ activities, noting when they posted sponsored content and whether or not it followed FTC guidelines. Of the 412 ads posted by the influencers during that period, 327--or 79 percent--didn’t comply with FTC standards.

“Our investigation indicates that the FTC’s reminder letters have been ineffective and enforcement action is desperately needed to protect consumers.” -- Public Citizen’s Kristen Strader

The number of undisclosed posts in that period reached as many as 35 for one influencer.

Because of the group’s findings, Public Citizen has sent a letter to the FTC asking it to take affirmative enforcement action against the influencers and advertisers that consistently post undisclosed paid product endorsements on Instagram.

“Without consequences, influencers and advertisers have no incentive to follow FTC policy and be honest with consumers,” said Commercial Alert Campaign Coordinator Kristen Strader. “Our investigation indicates that the FTC’s reminder letters have been ineffective and enforcement action is desperately needed to protect consumers.”

After describing its findings and talking about how these influencers continue to mislead consumers, the letter goes on to sum up the FTC’s guidelines and the actions taken in the spring with the letters.

Then, Public Citizen offers “evidence of serial non-compliance,” describing its investigation and results, including a number of examples of undisclosed sponsored posts from the 46 influencers.

Below is one example the group uses, an Instagram post from musician and businessman Akon in which he tagged watch brand Ratel Geneve but did not make clear the relationship between the two, even though he’s pictured and listed

Banner will be right here …

as a “friend of the brand” on the Ratel Geneve website.

  
  Smile!!! Life is beautiful ⯑⯑⯑⯑
 A post shared by Akon Official (@akon) on May 19, 2017 at 1:01pm PDT

Ultimately, the group asked the FTC to “bring enforcement actions and seek penalties” for sponsored content that isn’t disclosed, especially when it’s from repeat offenders.

Additionally, Public Citizen is asking for the FTC to work with Instagram to create a system that makes it easy for the influencers to denote the sponsored status of a post within its guidelines.

It’s worth noting that Instagram recently launched a “Paid partnership with…” format for sponsored posts, but Public Citizen said that even this new tool already needs an overhaul in order to make it clearer.

Public Citizen did not respond to an email from National Jeweler asking if it had received a response from the FTC.

The FTC has not yet commented publicly on the letter.

The full text of the letter can be found on Citizen.org.

Brecken Branstratoris the senior editor, gemstones at National Jeweler, covering sourcing, pricing and other developments in the colored stone sector.