Amazon and Google Under UK CMA Investigation for Fake Reviews

UK Watchdog Investigates Amazon and Google Over Fake Reviews

The Competition and Markets Authority (CMA), the UK’s competition regulator, has launched a new investigation into major technology companies – specifically, Amazon and Google – concerning their handling of fraudulent online reviews.

The CMA has demonstrated a sustained interest in the issue of online review manipulation, with scrutiny dating back to 2015.

Previous Actions Against Online Marketplaces

In 2019, the authority previously targeted eBay and Facebook, aiming to curtail the proliferation of fake reviews found on their platforms. Following continued pressure, both companies provided assurances they would enhance their efforts.

However, in Facebook’s case, it took until April 2021 for the platform to remove 16,000 groups involved in the trading of deceptive reviews. The CMA voiced its dissatisfaction with the extended timeframe for meaningful action.

Now, Amazon and Google are under examination, as both control platforms that host user reviews. The CMA will gather evidence to assess whether they have violated UK law by failing to adequately protect consumers from misleading reviews.

Businesses that intentionally mislead consumers, or fail to implement measures to prevent such deception, may be found in breach of UK consumer protection laws.

Initial Probe and Concerns

This investigation builds upon an initial assessment initiated in May 2020, which evaluated the internal systems and processes of several platforms for identifying and addressing fake reviews.

The initial work highlighted specific concerns regarding the extent to which Amazon and Google are actively working to:

• Detect fabricated or misleading reviews, as well as suspicious behavioral patterns. This includes instances where users review similar products or businesses concurrently without apparent connection, or where reviews suggest incentivized positive feedback.
• Promptly investigate and remove fraudulent reviews from their platforms.
• Apply appropriate penalties to reviewers or businesses to discourage the posting of deceptive reviews, particularly repeat offenders.

The regulator also expressed concern that Amazon’s systems are not effectively preventing sellers from manipulating product listings, such as by transferring positive reviews from unrelated items.

Instances of reviewers referencing product attributes irrelevant to the item being sold are increasingly common on Amazon.

Similarly, Google Maps reviews can exhibit ‘unusual patterns’ of overwhelmingly positive or negative ratings.

Statements from the CMA and Companies

Andrea Coscelli, CEO of the CMA, stated the organization’s concerns regarding the insufficient efforts of Amazon and Google to combat the problem of fake reviews.

Google provided the following statement in response to the investigation:

Amazon also issued a statement:

Amazon’s Response and Defensive Posture

In a recent blog post, Amazon acknowledged the issue of bogus online reviews, asserting its commitment to “relentlessly innovate” to ensure the authenticity of reviews. The company cited statistics, such as blocking over 200 million “suspected fake reviews” in 2020 through proactive detection methods.

However, the post also adopted a defensive tone, attributing some responsibility for the problem to external factors. Amazon highlighted an “increasing trend of bad actors” soliciting fake reviews via social media services.

The company framed fake reviews as an industry-wide challenge requiring a coordinated solution, while directing criticism towards unnamed “social media companies” as potential weak links.

Amazon’s blog post also called for collaborative support from consumer protection regulators globally to bolster its legal efforts against those involved in purchasing and providing fake reviews.

The company emphasized its success in obtaining “dozens” of injunctions against providers of fake reviews across Europe, and its willingness to pursue legal action, citing a recent lawsuit filed against the owners of AMZ Tigers and TesterJob.

Amazon’s call for regulatory assistance appears to be a preemptive attempt to redirect the CMA’s focus towards Facebook’s marketplace and its handling of fake review trading.

Further Investigation and Potential Outcomes

The CMA declined to comment on whether its investigation will consider the role of review trading groups hosted on other platforms, such as social media. However, it confirmed that the investigation into Amazon and Google is a separate undertaking.

If the CMA determines that Amazon and Google have violated UK consumer protection laws, it has the authority to secure commitments for change or pursue court action.

Currently, the CMA has not reached a conclusion regarding any legal violations.

Broader Regulatory Context

The CMA is increasingly active in regulating Big Tech, focusing on digital markets in preparation for upcoming UK competition law reforms. These reforms are expected to introduce an ex ante regime for addressing competition-hindering platform power.

The watchdog has several ongoing investigations into Big Tech, including Google’s planned deprecation of tracking cookies and a market study into the dominance of Apple and Google in the mobile ecosystem.

Given the CMA’s focus on major platforms and its long-standing interest in fake reviews, it is plausible that Apple’s App Store may also face scrutiny on this issue, given concerns about fake ratings and reviews.

iOS app developer Kosta Eleftheriou recently filed a lawsuit against Apple, alleging that the App Store is not a safe and trustworthy environment for developers.

The CMA is already investigating Apple’s App Store, examining whether it imposes unfair terms on developers that ultimately impact user choice and pricing.

For the time being, the regulator’s public attention regarding fake reviews remains focused on Amazon and Google.

This report was updated with additional context.