Q.What is the penalty for running a false or deceptive ad?
A.Making false claims regarding your products and/or services violate advertising laws. The penalties that can be imposed depend on the nature of the violation. The remedies that the FTC and the courts have imposed include:
- Cease and desist orders. These orders require the company to stop running the deceptive ad or engaging in the deceptive practice, to have objective evidence to substantiate their claims in future ads, to report periodically to FTC staff about the substantiation they have for claims in new ads, and to pay a fine of $11,000 per day per per advertisement if the company violates the law in the future.
- Civil penalties, consumer redress and other monetary remedies. Civil penalties range from thousands of dollars to millions of dollars, depending on the nature of the violation. Sometimes advertisers have been ordered to give full or partial refunds to all consumers who were decived into buying a product.
- Corrective advertising, disclosures and other informational remedies. Advertisers have been required to take out new ads to correct the misinformation conveyed in their original ad, to notify purchasers about deceptive claims in their ads, to include specific disclosures in their future ads, and to provide other information to consumers.
Don't run afoul of the advertising laws in your print ads or oline advertisements. Claims of deceptive advertising and false advertising can lead to large penalties.