Warner Bros. has been caught by the Federal Trade Commission paying YouTube creators for endorsements of the game Middle-Earth: Shadow of Mordor, Mashable reports.
The FTC claimed the entertainment company did not adequately disclose the fact that it paid the YouTube stars, with "hundreds to tens of thousands of dollars" paid to 'digital influencers' for sponsored video creation, the settlement said.
The company allegedly paid the influencers via its advertising agency Plaid Social Labs, also offering them free advance copies of the game in order for them to post about it on their YouTube channels and social media accounts.
The FTC has ruled that the videos made under these circumstances count as 'sponsored advertisements' and are in breach of endorsement guidelines due to the lack of full disclosure on Warner Bros. part.
Last week, new guidelines for online reviews and endorsements were published by the International Consumer Protection and Enforcement Network (ICPEN), warning marketers and digitial influencers against posting fake or biased reviews that could mislead customers.
ICPEN said: "Disclosure of a commercial relationship may be appropriate regardless of whether the digital influencer has been paid, or is otherwise obliged, to write or talk about a good or service at a particular time."
06/07/2016: Digital influencers warned against fake or biased reviews
New guidelines for online reviews and endorsements have been published, warning marketers and digital influencers against fake or biased reviews that could mislead consumers and impact competition.
The guidelines, created by the International Consumer Protection and Enforcement Network (ICPEN) in work led by the UK's Competition and Markets Authority (CMA), say that digital influencers, such as YouTube and Instagram stars, should not publish online reviews or endorsements "not based on a genuine experience" or that "displays elements of bias without appropriate disclosure" so as not to unfairly influence consumers.
ICPEN said: "Disclosure of a commercial relationship may be appropriate regardless of whether the digital influencer has been paid, or is otherwise obliged, to write or talk about a good or service at a particular time.
"For example, a business may pay a celebrity to promote their brand, but may not have paid him or her to tweet a particular endorsement; nonetheless, it may well be appropriate for the tweeter to tell readers that they have a financial connection to the business."
Many YouTube vloggers, social media celebrities and other influential personalities online are often paid to endorse certain products and services via their platforms, but are encouraged to disclose relevant commercial ties to businesses featured in content.
This week two YouTube gamers, Trevor Martin and Tom Cassell (known as TmarTn and Syndicate Project), were caught uploading videos in which they appears to win prizes playing CSGO Lotto despite the pair actually being presidents of the company, reports BBC News.
In response, Martin said: "I created a site. It wanted to build something awesome for other people to enjoy and I played on it. Obviously, on my end, me playing on Lotto rather than other sites, gives me an advantage because it promotes my own site, and it is not immoral, there is nothing wrong with it. I am 100 per cent honest."
