A resent settlement by department store chain Lord and Taylor marks the first time the Federal Trade Commission (FTC) has settled claims involving the practice of "native advertising" since it issued an enforcement policy statement in December. Lord and Taylor was accused of deceiving consumers with paid online promotions that appeared to be from independent sources. The settlement requires the company to get a signed statement from each endorser acknowledging the individual's disclosure responsibility.
“The consent decree demonstrates that companies, as a risk management measure, must adopt a comprehensive compliance management system that includes both educating endorsers about their disclosure responsibilities as well as a system of monitoring endorsers’ representations and disclosures,” said Anthony DiResta, co-chair of Holland & Knight's Consumer Protection Defense and Compliance Team.
READ: Lord & Taylor, FTC Settle Deceptive Ad Charges (subscription may be required)
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