According to a statement from the organization on Tuesday, the Federal Trade Commission announced that online retailer Fashion Nova would reportedly have to pay $4.2 million for barring negative reviews of its products from being posted on its website. This is the first time the FTC has challenged a company for refusing to post negative reviews.
Fashion Nova was accused of removing negative reviews with less than four out of five stars from late 2015 to November 2019. Additionally, the FTC stated that the clothing brand used a third-party online product review management system to automatically boost positive ratings while filtering out negative ratings to the company’s approval, Essence reported.
In the press release, the organization said, “Suppressing a product’s negative reviews deprives consumers of potentially useful information and artificially inflates the product’s average star rating.” As a result, the retailer will post all customer reviews under sold products on the website as part of the settlement.
Terry Fahn, a spokesman for Fashion Nova, said in an email statement that the allegations were “inaccurate” and that the company feels “highly confident that it would have won in court and only agreed to settle the case to avoid the distraction and legal fees that it would incur in litigation, The New York Times reported. “At one point in time, the company inadvertently failed to complete this process given certain resource constraints during a period of rapid growth,” she continued.
Though Fashion Nova is the first company to be fined for removing negative reviews, the FTC has notified more than 700 businesses in October for posting fake reviews on their websites.
In April 2020, Fashion Nova paid $9.3 million after not allowing customers to cancel their orders when they weren’t delivered on time. The company was also fined for providing illegal gift cards to customers instead of refunds when orders failed to ship.
