The Disclosure You Need On Your Hubs Today To Avoid FTC Prosecution
It has just been announced that the U.S. Federal Trade Commission (FTC) wants to expand its enforcement against false and misleading advertising by extending its jurisdiction to online writing.
In the updated FTC Guidelines Concerning the Use of Endorsements and Testimonials in Advertising, the agency proposes searching online pages for misleading information and failure to publicize potential conflicts of interest. What that means is that any blogger (defined loosely as anyone writing a personal journal online which of course includes Hubbers) that reviews products is subject to a thorough examination.
These guidelines are expected to be approved in a couple of months from now with some likely modifications which could make them more or less strict. As they exist now, they would clarify that the FTC has the right to prosecute online writers as well as the companies that pay them fees no matter how small, for any false claims or for failing to disclose the conflicts of interest.
The definition of conflicts of interest would be the ones that arise when anyone places on a website any form of review or test of a product while at the same time collecting any amount of money from clicks on the ads which relate to the product. It actually goes beyond this: According to the Washington Post, any type of blog could be scrutinized, not just ones that specialize in reviews.
Let's take an example: You write a Hub about a Technowizard iWidget phone. The Hub outlines the features of the iWidget and includes your favorable experience with an iWidget. If anyone clicks on any of the ads, including the Adsense, eBay, Amazon, or Kontera links and ends up buying even a $2 vinyl iWidget carrying case which results in the big commission to you of 2 cents, the FTC could prosecute you under the new laws.
According to Rich Cleland, the assistant director in the FTC’s division of advertising practices: "Affiliate marketers are covered, and the stress there is on 'marketers'. You can put a different name on it, but you’re still a marketer. We really want people to distinguish between advertising and nonadvertising."
The interviewer went on to ask the question of whether the FTC really wants to spend time making sure that bloggers who make a nickel commission on the sale of a $0.99 mp3 clearly disclose their "conflict of interest" to their readers? Answer: Yes, they do.
The way the FTC guidelines currently stand they are not out and out prohibiting discussion of products or services, as that would violate First Amendment rights. What they are demanding is a disclosure statement on any page where claims are made about a product or service.
I don't usually direct Hub readers to other sites, but in this case I believe it's necessary. DisclosurePolicy.org's Policy Generator allows you to answer a few questions and get a fully applicable and legal disclosure policy generated to suit your web page's content. It's completely free to use and there are no limits.
Keep in mind that this DisclosurePolicy.org site is operated by the company that runs PayPerPost.com, which is a leading paid blogger review organization exactly of the type which is in the FTC's crosshairs. That can be a good thing, as it's quite certain that their lawyers will stay right on top of this developing situation at the FTC and will ensure that the disclosure statements generated will adhere to all the guidelines.
Therefore, from now on, if you write a Hub that mentions a product or service in any way other than blasting it as the worst POS on the face of the Earth (and even that could be taken as some form of sideways endorsement) and you have any form of Adsense, Kontera, eBay, Amazon or advertisement placement on your page that has anything at all to do with that product or service, place a clear and properly worded disclosure on each and every Hub or other web page you write!
Start today as you never know whether the FTC is going to establish some form of retroactive policy. Also, don't use the excuse that you live outside the USA to avoid this disclosure. HubPages is based in the United States, fully within FTC jurisdiction and that still means that the manure could impact the spinning blades.
Remember: Better safe (and fully disclosed) than sorry!