The FTC rules on testimonials and fake reviews, in plain English

Most owners I talk to assume the FTC's rules on reviews are for supplement companies and influencers with a million followers. They are for anybody who puts one customer's words in front of the next customer, which includes the plumber with four testimonials on his homepage and the salon with a Google rating it would like to be higher.

Here is what the rules say, in the order you are likely to run into them. Nothing here is legal advice, only a careful reading of what the Federal Trade Commission has published, with links, so you can check it yourself.

Two sets of rules, one idea

The newer one is the Trade Regulation Rule on the Use of Consumer Reviews and Testimonials, announced on 14 August 2024. It took effect on 21 October 2024, and what made it matter is money. Under the rule the FTC can ask a court for civil penalties against a business that breaks it knowingly.

The older one is the Endorsement Guides, last revised in 2023. They are guidance on what counts as deceptive, and they are where most of the rules about testimonials on your own site come from.

The idea behind both fits on an index card. A reader is entitled to assume the words came from a real customer who meant them, and anything that would change how they weigh those words has to be out in the open.

What the 2024 rule bans

Six things, each with its own section:

• Fake reviews and testimonials. One from somebody who does not exist, or who never used the business, or that misstates what they went through. Who wrote it does not matter, a person or a piece of software.
• Buying reviews that have to say something. Paying for a review, or rewarding one, on the condition that it is positive. Or negative, about a competitor.
• Insider reviews without saying so. A review from your own staff, a manager or a relative has to say what the connection is.
• A review site you secretly run. Presenting a website as independent when it is yours.
• Review suppression. Threatening a reviewer, or accusing them of something you know is false, to get a review taken down or stop one being written.
• Fake social media numbers. Buying fake followers or views to look more popular than you are.

What it does not ban

Asking. Nothing in the rule stops you asking customers for reviews. The FTC's own questions and answers go further: a general request to your customers to review their experience is exempt from the insider section, even if one of the customers who answers it works for you. Asking every customer is fine, and asking every customer the same day is better.

An incentive for any honest review. The FTC says the rule "does not prohibit giving incentives for reviews" as long as nothing requires them to be good. Two catches. The Endorsement Guides still expect a reader to be told when a review came with a reward. And Google does not allow incentives for Google reviews at all, which the discount post goes into.

Answering a bad review. You can respond in public. What the rule forbids is accusing the reviewer of something you know is false, or saying it with reckless disregard for whether it is. The post on bad reviews has replies that stay well clear of that.

Testimonials on your own site

Here the Endorsement Guides do most of the work, and three of their points come up for small businesses all the time.

Do not change what the customer meant. The Guides allow you to quote a customer without using every word, but an endorsement may not be "presented out of context or reworded so as to distort" what they thought. Trimming a long message to its best sentence is normal. Cutting "the price was higher than I expected, but" off the front of "worth every penny" is not.

Say when there is a connection. Your sister-in-law, your employee's husband, the customer whose job you did for free: if a reader would weigh the words differently knowing that, the connection gets disclosed, right next to the words. A short line does it.

Be careful with results. If a testimonial says the new furnace cut the gas bill in half, and that is unusual, the Guides expect you to say what people generally get. This matters most for trades that sell an outcome: personal trainers, tutors, anyone who installs something that saves money.

What enforcement has looked like

Fourteen months after the rule took effect, on 22 December 2025, the FTC sent warning letters to ten companies. It did not name them, and the practices it listed included fake reviews and insider reviews nobody had disclosed. The letters warned of civil penalties of up to $53,088 per violation, which is still the figure in the FTC's penalty table today.

The case closest to home came on 11 May 2026. The Justice Department, on the FTC's behalf, and the State of Illinois sued a Chicago company called Premium Home Service and its owner. The complaint says the company set up thousands of listings for home repair businesses that did not really exist, and propped up their ratings with made-up five-star reviews, including reviews sought from employees and relatives. The complaint says that broke the review rule, and the Justice Department filed the complaint in federal court in Chicago. Those are allegations, and the case has not been decided.

A roofer in Joliet with one testimonial from his brother is not what that case is about. But it is about home repair, and about fake five-star reviews and reviews from relatives, in Illinois. The rule is not only for companies selling pills on Instagram.

The short version

Use real words from real customers. Leave them meaning what they meant. Say so when there is a connection. Ask everybody, and never make a reward depend on praise.

That list is also the whole design of Exalted. Every testimonial arrives in the customer's own words through a link you sent them, you decide which to show, and there is no field anywhere to type one in yourself. If you want the wording for the ask, the post on asking for a testimonial has it, and the pages by trade have a version for yours.

The cases and the penalty figure here were checked against ftc.gov, justice.gov and the federal regulations on 29 September 2026. The FTC adjusts its penalty amounts for inflation from time to time, and new cases come along, so check the links for anything newer.