Hunton Retail Law Resource

On March 16, 2023, the Federal Trade Commission announced it issued orders to eight social media and video streaming platforms seeking Special Reports on how the platforms review and monitor commercial advertising to detect, prevent and reduce deceptive advertisements, including those related to fraudulent healthcare products, financial scams and the sale of fake goods. The FTC sent the orders pursuant to its resolution directing the FTC to use all available compulsory process to inquire into this topic, and using the FTC’s Section 6(b) authority, which authorizes the FTC to conduct studies that do not have a specific law enforcement purpose.

The orders request information from 2019 through the present about the companies’ standards and policies related to paid commercial ads and the companies’ processes for screening and monitoring for compliance with those controls, including human review and use of algorithmic, machine learning or automated systems. In addition, the orders require the companies to report their revenue, number of views and other performance metrics for paid ads. The inquiries reflect a focus by the FTC on the extent of deceptive advertising on social media and video platforms; how the platforms create and monitor ads; and how they help consumers distinguish advertising and other commercial messages from other types of content.