New FTC Regulations every business on Social Media NEEDS to know

Holy smokes, this episode might save you tens of thousands of dollars. Listen, legal talk, it doesn't need to be spooky, and I promise you this isn't going to be a spooky episode, because I have an expert here who takes all the spookiness out of legalese and anything to do with contracts and the legal side of having a small business, you might know that I just launched a program called Testimonials That Sell, and it's a program to help you get better testimonials, know how to actually use them in your marketing, and organize them in a super sleek way.

And throughout this program, I had at the back of my head, I really hope I'm not leading people astray here, but because there are legalities around using testimonials in your business. Cut to like, a week after I launched this mini course, and the FTC announces new regulations on what they will allow for testimonials and what is considered like, legal social proof to share on behalf of your business.

And then, this person who I found. follow, and I've followed for a long time, Amber Gilormo, who is a lawyer, posts all about these new FTC regulations and testimonials and how you can legally use them inside your business. And so I rushed her to the microphone. I rushed her here to this Zoom call so that she could talk to you about ways to protect yourself when using testimonials.

So let me give you a quick rundown on to who Amber is before I. stop being awkward and looking at her without letting her speak and actually talk to her. So Amber Glormo is not your typical business attorney. She's a powerhouse entrepreneur and the founder of The Boutique Lawyer, where she's on a mission to help female business owners scale with confidence.

Scale, meaning grow that big, beautiful business of yours. She has 14 years of legal experience and a knack for turning complex legalese into something accessible and fun, which, as you know, is one of my core values as well, which is, I think, why we've been drawn to each other. Amber also has a digital contract template shop for creatives.

We're going to tell you more about that later. And it's also for online entrepreneurs, which I know a lot of you are, who want to protect your business without getting bogged down in all of the jargon and the spookiness. She's also a mom of four,  a multi hyphenate entrepreneur, and she's passionate about empowering others to build their dreams on a solid legal foundation.

Amber, hello! I feel like there should be fireworks or something after that intro.  Hello, I'm here. I'm excited to talk about this because like you're so right. Testimonials are like, it's so incredibly important in your business and we care so much about them,  both from the consumer side and from the legal side.

So yay.  Yeah, I mean, they're such a powerful marketing tool. And so many people tell me they have testimonials and they don't know how to use them. And then I fear that with all of the hype around the FTC changes, people are going to be even more hesitant to use testimonials. And this, this like interview, this isn't about holding back, right?

We don't want you to not use them so you don't get in trouble. We want you to feel empowered to use them in a way that is going to keep your brand safe.  Exactly. It's more of like a CYA as opposed to like, don't do it because you definitely should do it and need to do it. It's isn't aren't like testimonials are basically the heart of affiliate marketing too, right?

You're like telling people your opinion on something that you love it, you don't love it. And ultimately, like, that's what a testimonial is. It's your clients, you know, or your customers feedback based on your offer. And so of course, with the rise in, ,  social media marketing, influencer marketing, affiliate marketing, , over the last four years, , there has been a bigger kind of spotlight in the legal world, uh, by this beautiful agency called the federal trade commission, refer to them as the FTC, and they are the governmental agency in the U S, , who tells us kind of what we can and can't do in our marketing. 

They've recently come out with some,  it's kind of like their new, they call it a final rule. That means it's a law. Let's just like, don't get complicated there. They come out with a law that basically says, , you know, how you can and can't use testimonials, reviews, and things like it. Social media indicators, , that's their legal phrase , referring to your followers, your engagement count.

They want you to be, like, real with it as opposed to using fake followers and fake engagement stuff on your social media profile.   What is their terminology? They call it, , social media indicators.  Buying fake followers would be creating us a fake social media indicator, an untrue one, or buying engagement on a post would be a false social media indicator, which then their worry, just let me know if I've got this right, like their worry, someone's going to see your post with a thousand likes and trust you when you really haven't earned that trust.

Well, that's exactly it, right? Because you have now businesses going and hiring people who have a million followers or maybe a hundred thousand followers, right? They hire them or even less than that, but just to, , Endorse a product or, ,  for affiliate marketing, they go and they hire them based on like what they see on their profile, right?

So whether they have, you know, X, Y, Z followers, they have a supposedly good engagement rate, which all of that can be manipulated, right? Through purchasing those, those products. as the legal phrase, social media indicators, fake followers, fake like that kind of stuff. So the rule encompasses that. And so we already knew it wasn't  a good idea to do that anyways.

It's already against the platform's terms of service. So the social media platform has the terms of service that tells you again, what you can and can't do on their platform. That wasn't allowed, but it really wasn't enforced. Right. And so now the FTC has come and said like, yeah, no, you can't do that. And if you do that, you're going to face fines of up to 51, 745 per instance of you doing this.

So fines over 50, 000 per instance of you doing something like that. What a strange number. Why is that number so strange? I don't know.  I don't make the laws way above my pay grade. That's just what it is, right? Um, and I was speaking from memory there. I know it's 51, 007 something. I think it's 45. I don't know.

But, you know, it's like a lot of money, like, per instance of you doing something like that. So, , the same carries for, like, your use of testimonials, right, making sure that you're using reviews in a legal way. Those, , violations fall under that same kind of civil penalty.  So you want to make sure you're doing it correctly.

 want to speak briefly to the person. I can feel her panicking because somebody is listening and they bought likes or they bought followers a year ago before they knew not to and they're listening and they're, shh,  I'll say shh, shaking in their pants. 

Do you know or can you say like what do you think somebody should do if they find themselves in that position? Yeah, you know, it depends on like how much right so if like your entire social media presence in business is built Like if say you're a social media educator and you bought 50, 000 followers I don't know.

I'm just using random numbers and you have 75, 000 followers like total So if you have a majority of your audience is like fake in your business is essentially based on fake stuff, then maybe you should start a new page, right? And do all the things that you now know to do and build it up and make that your storyline.

But if you're the person who's bought like a thousand likes or, you know, tried it out and you're not doing it anymore, you tried it once or twice, I personally, I wouldn't worry about it too much. I mean, I'm not saying that could anything ever happen bad. Of course. I mean, that's the. The universe, but like, is it likely to?

No. , the FTC is really concerned more so  with   big fish. You never know when you're going to pop up on their radar. Literally it could be an agent of the FTC scrolling on their Facebook, , app one night and like an ad pops up. It happens to be your ad. And they're like, no, that's a badly written ad.

I'm going to flag them. We're going to follow up with them, send them a warning letter. Like you could just have bad luck, but more often than not,  They're going to come across people who either are like, the people who they think should be made an example of, , people who they think they can get some money out of, you know, they want to have a reason for  going after 

 

somebody, right?

So a big fish, so to speak. And so, There is no magic number. I know this is like a common myth that floats around like, oh, you know, You need to be making seven figures a year in order for  the FTC to be worried about you There's no  number like that at the FTC. There's no standard like that But if you are just ran, you know have done it in the past, but your business is like legit You don't do things like that anymore.

I really wouldn't worry about it too much Unless it's the foundation of your business, you know, so it's kind of a balancing act but  That person who may be freaking out, you know, just try and breathe deep and  take this to heart and then move forward in like the best ethical capacity you can.

Yeah, and that's Amber's opinion as a friend, not her, not your lawyer.  Yeah, well, thank you for that disclaimer. I appreciate it. Yes, this is legal info, not legal advice as always.  Yeah,  I just feel like we need to get the heart of  things that might be freaking people out and then we can talk about strong ways to move forward.

 So like, knowing people can buy other people bots, people can attract bots accidentally, how do you think the FTC is even going to regulate this?

, how are they going to know if you intentionally attracted any kind of fake metrics?  If somebody sues you, they have to have evidence to prove that you've done this, right? So it can't just really be circumstantial.  They can get evidence through like subpoenas and other stuff.

They can look at our DMs, they can look at our bank records, they can see if we've bought it. , so those are the kind of evidence things that they would  try to gather in order to prove it, so to speak. I mean, even I think a small percentage of followers being bought, I really don't think that's what they're concerned with. Right. They're probably concerned with, ,  big influencers who've purchased them, , because there are plenty, , that there are some like scamming coaching industry, you know, people out there who have purchased them and built businesses off of it.



 The goal of the law in general is to make sure that there's like, I don't know They won't lie then people lie I see them lie and I see good people lie because they don't know not to so i see that all the time But i've seen people in their bios be like a hundred K in 30 days and then they DM me and they're like, can you help me grow?

I swear to God, they'll be like, can you help me grow my account? I can't make any money. And I'm like, wait, what? You just, I watched you write posts about how much money you're making. And I've told multiple people, girl, you can't do that. Like, and they're like, what? I'm like, it's, you can't, you can't make false income claims.

No, that's actually a huge piece, right? So like, that's, , another metric, those like screenshots and like, apparently you can fake all of that, right? Like you can create  your, your fake screenshots. There's like big screenshot generators or whatever. But, , yeah. So when the FTC, if, if they do ever like.

come after you, so to speak. They'll do it through an enforcement action. That's a lawsuit. And as part of that, you do have to provide proof, right, that you've done certain things ethically to like rebut whatever presumption , to kind of argue your point, right? Let's  not speak in legalese to argue your point.

Um, you need to provide evidence. So one of the standards under this new law is you need to have, evidence of all the claims you're making, right? If we're talking about income claims and you're screenshotting stuff, you want to make sure that you like keep a little side folder on your desktop and back up all your stuff.

You want to just have evidence that all of that's legit and like something you generated in case you're ever questioned about it. But I mean that's a pretty kind of easy CYA in the legal world. Just like keep a little evidence folder, document your stuff. Okay, you used this before and I let it go, but what is CYA? 

Oh, cover your butt. Oh my gosh, that's funny. Okay, CYA, okay, I'm gonna use that. 

I thought it was like legal jargon. Oh no, sorry.  We say cover your ass ets, assets.  Okay, wonderful, wonderful. Alright, so, , in Testimonials That Sell,  one of the systems that I give away, I will give away to you right now, dear listener, , one of the systems that I give away is to basically send a questionnaire to your clients who you've worked with all about their experience working with you, and then A lot of people don't realize this is how folks are getting amazing testimonials.

And then they fill out that form, and then they send it back to you, and then you take what they said, and turn it into a bangin testimonial, and send it back to them for approval. And that would sound sketch, but that is totally legit, right? And still given the new FTC guidelines, that's still okay? 

Yeah, , , sending them a form, getting their feedback, and then, like, compiling it. That's fine. What the FTC doesn't want you to do is  give them, you know, a gift card in exchange for a five star review, right? So they don't want those incentivized, , positive reviews. As long as it's an honest, , real client, real customer review.

That's exactly what they want you to do. , so I mean that process you described, that's great. I would say  a key kind of legal tip is you said get permission, but it's always a great idea to get  clear legal permission to repurpose that testimonial for your marketing campaigns, for your social media, for your website.

So that in the event,  maybe they come across some copyright posts and like, Oh, she used my words. I'm entitled to money for that. Like, no, hey, you did give me permission for that. Thank you. , so just so it's kind of like, , a good legal step to take, like you did get permission to use it in all of these ways.

And you can do that through a testimonial release. , which I'm excited to give listeners a free testimonial release. , because What a brilliant, what a brilliant segway just done by an artist of segways. Yeah, we have a gift for you, Amber Cain, Burying Gifts.  Yes, legal gifts as it were, but yes, , , it's an easy  template.

You can just pop it. , my favorite way to do it is in that form that you suggested. , at the bottom, like when you say you're giving us permission to use, , your testimonial in our marketing, uh, pursuant to this release and you can like hyperlink it in there, they can review it and then you're good.

Like you have their permission. So I love that because then you have  your legal  ducks in a row. , and you just feel good, like knowing that you can confidently use that information, uh, however you need to, you know, better your business. I'm asking this solely for greedy selfish, uh, personal reasons, but what about in your terms and conditions checkbox when someone buys something from you?

Could you put this type of language there? Yeah, absolutely. So, if you sell digital products, which is like the number one way I see it done, , you can have, as a part of your terms and conditions,  a consent to use products. People call it different things depending on what lawyer wrote it. That's what I call it.

But it's like you can send to use their feedback or their, you know, information, the review they leave on your website and your marketing materials. I would just incorporate it there too. And when you get that little check mark, it's called click rep, or, you know, you're getting there. We call it affirmative consent to use that, , feedback in your marketing.

And that's another good way to get that, , consent legally.  Amazing. Okay. I think that we have.  Simultaneously made people aware of stuff that they didn't know about and given them some practical tips to move forward legally in their business while using amazing social proof and probably getting more clients because of that amazing social proof and amazing testimonials.

Is there anything else you want to leave people with?  I would say for the legal stuff, just don't sweat it, like truly don't set it, don't let it stop you, right? That's the biggest piece I see is  people who, , are trying their best, it's easy to get overwhelmed with it, but just tackle one little piece at a time and you will feel so much better. 

Amber, you are such a freaking wealth of knowledge, and I feel like when we get inside your head, it can help people, , grow their businesses  so much more safely, and sleep better at night, feeling like we're protected and  that we're not biting off more than we can chew.

How can people continue to learn from you? So this is probably my favorite thing to talk about. And that's like an entirely separate podcast episode,  probably my own podcast one day, maybe, I don't know. But I love learning styles in general. , it's one of my like favorite things to chat about. I have a, , digital magazine coming out called the legal zine.

And the goal of this is to educate, but more so than that, give. Online entrepreneurs, people who are trying to market their business online, practical steps, resources like template scripts, , so that they can check the legal off their to do list once a month. , because we have so much to do, right?

Like between collecting our testimonials, getting our clients and our products created, marketing ourselves. Legal always gets pushed to the side, right? Cause it's one of those things it's like, okay, we'll do it when we can, but this is going to help you get it done. And I can't wait to  be able to actually.

You know, give it out there and share it to people. Okay, as soon as it is ready, we will have it linked in the show notes. But meantime, head down to the show notes to get that free template that Amber's given you. I'll also link you to Testimonials That Sell if you want to sign up for that  mini course.

And of course, her Instagram, which is a lot of fun, and you got to follow that at The Boutique Lawyer.  That's it.  And with that, I will see you in the next one. Thank you so much, Amber.  Thank you.