Fake Testimonials! As Kurt Cobain said, the worst crime is faking it. While he probably wasn't talking about internet testimonials, maybe he should have been? Find out more in this week's You Legal TV.

See below for the complete transcript of this episode -

It's on the internet, so it must be true, right? That's a statement we can all laugh at, but when it comes to testimonials by companies we know and trust, we do hope for a higher standard. Well, this might not have always been the case. A recent decision of the federal court will certainly help companies to ensure that they do so.

While posting a fake testimonial might seem like a cheap and harmless way to promote a product or company, a Sydney cleaning franchise recently found out it's a very expensive activity because it was fined $215,000.00 for doing just that. The company posted and asked its franchisees to post reviews by customers who didn't exist for services that were never carried out.

In an action brought by the Australian Competition and Consumer Commission, the federal court deemed the practice a form of false or misleading advertising and determined that the fabricated testimonials had the potential to mislead large numbers of consumers, divert customers away from law-abiding competitors and generate a positive perception of the company that was based on false goods.

The judgment stated that by manipulating or producing false reviews or testimonials, businesses might be misleading consumers who rely on them when making their purchasing decisions. This is a clear breach of Australian consumer law. Along with the $215,000.00 in penalties, the court order included injunctions, corrective advertising and that the company was to pay a contribution towards the triple C's costs, and this included a significant discount for cooperation by the company.

If you need any advice on whether you are meeting your obligations under Australian consumer law, please call us at You Legal.

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