Spotting a Fake Online Review

The emergence of consumer review sites has given rise to what one Yelp official refers to as the “consumer deception industry.” And in recent months, Yelp and Edmunds have taken steps to prevent their sites from becoming playgrounds for fake reviews.

In late July, Edmunds filed a lawsuit against Humankind Design Ltd., the parent company of GlowingReviews.co. The vehicle information site claims the Friendswood, Texas-based company was doing more than managing dealers’ online reputations, charging the defendants with registering more than 2,000 fake accounts on Edmunds.com and attempting to post at least 76 fraudulent reviews on behalf of 25 dealerships nationwide.

One month earlier, Yelp filed a similar lawsuit against Timothy Catron, owner of AdBlaze.com and BuyYelpReview.com. Yelp is also seeking monetary damages from 50 yet-to-be-identified defendants who allegedly utilized the company’s services to create fake reviews.

Ken Levin is general counsel for Edmunds. He says the car-shopping site is not pursuing action against the dealers Humankind represented because it would be difficult to prove whether they were complicit with the scam. In one case, he adds, the affected dealer claims he has never even heard of Humankind. “We don’t really know what the facts are,” Levin says. “And that’s why we’re not really accusing the dealers of anything, other than putting them on notice of the situation.”

Unveiling Deception

On Jan. 22, Edmunds identified a review that was “likely to be bogus.” Almost two months later on March 11, the company was able to connect Humankind with the additional fake reviews that began to pour in from the firm’s 2,065 accounts. This led to the legal action Edmunds filed in a Texas court on July 23.

Justin Anderson, owner of Humankind, denies the allegations. “We don’t write the reviews or invent the reviews. We’re posting, to our knowledge, a bona fide review,” he tells Auto Dealer Monthly.

The suit seeks injunctive relief, which would prohibit Humankind from registering additional accounts or submitting reviews to Edmunds.com. Since the petition was filed, Edmunds reports it has not detected any further reviews submitted by Humankind on behalf of car dealers.

The majority of the fraudulent reviews were linked to operations based in New York City and Los Angeles. Levin says Edmunds reached out to the list of dealers, 12 of which are clients, and issued the following warning: “Please do not do business with companies that don’t honor the requirements of our membership agreement.”

Levin presumes that since no further reviews from Humankind have appeared, the company likely grew reluctant to continue posting. That leads to the possibility that there could be more dealers involved who were left waiting for reviews they purchased before the lawsuit was filed.
To submit a dealership review to Edmunds.com, users must register with a name and e-mail address. Registrants must also agree to the site’s terms of service (TOS), which states members must “agree to register only once using a single username,” a recurring point highlighted in the lawsuit.

GlowingReviews’ site has since been taken down, but its old FAQ page can be found on the Internet archive site WayBack Machine. The page acknowledges that the company’s reviews violate the terms of service for various review sites. “If you take the time to actually read the TOS, you’ll see that it’s very easy to break something,” the page states. “Every business plays in this grey area and this service just lets you do it much more efficiently.”

Humankind is also charged with trademark infringement for using Edmunds’ company name and logo. GlowingReviews’ homepage lists 15 sites it has partnered with, including Edmunds and other top automotive review sites like Yelp, Google+, Cars.com and DealerRater. Yelp, Cars.com and DealerRater deny they are partners with the site, and Google declined to comment on the litigation.

Related Cases

Yelp filed its suit on June 20 against a similar third-party company. Yelp’s director of public policy, Luther Lowe, refers to that defendant as a participant in the so-called “consumer deception industry.”

The June lawsuit charges AdBlaze and BuyYelpReview with trying to “game the system and build a business on selling fraudulent content,” among other allegations, including trademark infringement, false advertising and “cybersquatting” — a practice by which a site uses an identifiable company, such as Yelp, within its domain name to profit for itself.

The defendant, AdBlaze.com’s Catron, did not respond to requests for comment.

According to the complaint, Yelp has yet to identify the entire list of businesses that purchased the reviews in question, so it is uncertain whether any are car dealers. Lowe declined to comment directly on the pending litigation, but offered insight in broader terms.

“There’s been a steadfast emphasis [at Yelp] on protecting consumers and making sure that, at the end of the day, the stuff you read on Yelp is a pretty darn good predictor of what your offline experience is going to be,” he says. “If you don’t have that core piece of it, then people are not going to come back to your site and use it as a resource.”

Gartner Research predicts that 10 to 15 percent of all reviews will be fake or deceptive by 2014. That number currently sits at around 2 to 6 percent, according to findings in the firm’s January 2013 report, “Solve the Problem of Fake Online Reviews or Lose Credibility with Consumers.” If realized, the prediction could cut into the influence review sites are having on consumer purchases, with Digital Air Strike, a reputation management firm, reporting that 67 percent of vehicle shoppers rely on customer reviews when considering a vehicle purchase.

Jenny Sussin, co-author of the study, wrote in an e-mail to Auto Dealer Monthly that Edmunds and Yelp have their reputations on the line, so these lawsuits serve as important reminders to both the reputation companies and dealers.

“If they start being known as a playground for fake reviews, people stop visiting the site and advertising spend goes down the drain. It is important for these sites to show they are trying to maintain a degree of integrity that allows for people to still trust them,” Sussin says. “However, as Edmunds and Yelp get smarter, so do people soliciting fake reviews.”

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ID’ing a Fake

The dealer reviews Humankind attempted to post to Edmunds.com were detected by employees before they ever appeared on the site, company officials say. Levin explains that the 2,065 accounts allegedly registered by Humankind — each created under fictitious names of females — were sitting inactive on Edmunds’ site in order to age, a practice some firms follow to legitimize the accounts. He adds that the accounts weren’t discovered to be fake until Humankind attempted to post the 76 detected reviews.

“The registration doesn’t have much impact on us until the person uses the registration to submit content under the name,” Levin explains.

While Edmunds’ reviews are screened individually by staffers, Yelp’s employees don’t step in unless something is flagged as a violation. Yelp’s consumer ratings and reviews are prominently monitored by the company’s infamous filters, programmed algorithms which direct a portion of all reviews to a “Filtered” folder that appears in a separate and less visible space on each of Yelp’s business pages.

According to Yelp’s 10-K filing with the Securities and Exchange Commission (SEC), the site filtered 24.75 percent, or 8.1 million, of its 36 million cumulative reviews it received in 2012; 22 percent were captured in 2011. The percentage of Yelp reviews caught by the filter has served as a point of contention for car dealers in recent years.

“Our review filter is as much our Achilles heel as it is our heart. The most helpful information is displayed to consumers, and sometimes perfectly legitimate content can wind up in that filter,” Yelp’s Lowe admits. “That’s a high cost we have to accept to avoid the infinitely higher cost of having a review website that people can’t trust.

“By protecting consumers, we’re actually protecting small business owners, because if you’ve got Car Dealer A who’s participating in this nefarious behavior, that’s not fair to Car Dealer B across the street who’s running a great business, providing customers with great service at a good price and giving them an honest deal.”

Yelp also sets up sting operations in which it responds to ads on classified sites such as Craiglist. If a business expresses interest in hiring someone to post fake reviews, Yelp team members will flag that business page with what Lowe refers to as a “shame component,” a consumer alert pop-up message that reads: “We caught someone offering up cash, discounts, gift certificates or other incentives in exchange for reviews about this business. We wanted you to know because buying reviews not only hurts consumers, but also honest businesses who play by the rules. Check out the evidence here.”

Viewers can then click through to a link that displays a screenshot of the e-mail exchange between the deceptive business and Yelp staffers who initiated the sting. The alert remains on the business’ page for 90 days.

Penny for Your Thoughts

Lowe says Yelp only flags businesses for consumer alerts after it has collected enough hard evidence of any wrongdoing. But for the average onlooker, spotting a fraudulent review isn’t so straightforward.

Identifying a fake review has become a science for research firms. Eric Anderson, professor of marketing at Northwestern University’s Kellogg School of Management, recently investigated consumer reviews of an unnamed apparel retailer. His findings, along with those of co-author Duncan Simester, a professor at the Massachusetts Institute of Technology (MIT), were shared in a report released in May titled, “Deceptive Reviews: The Influential Tail.”

The authors of the study offered several recommendations for consumer review platforms, such as refraining from “publicly rewarding prolific reviewers with an ‘elite reviewer’ status,” or “only allowing reviewers to submit reviews for items that they have purchased.”

Mark Holthoff, Edmunds’ director of community products, leads the dealer review vertical. He is “intrigued” by the idea of incorporating consumer alerts when rogue dealers are caught posting fake reviews. He also likes the idea of tying reviews directly to vehicle purchases, a strategy that originated on sites like Amazon and Expedia. Although he says there are no formal plans to change the review platform anytime soon, Holthoff says the two tactics are definitely worth considering for the future.

The MIT/Northwestern study, however, points out that such strategies would be tricky for sites like Yelp or TripAdvisor, where not all reviews can be linked to a transaction.

In terms of linguistic cues, the researchers discovered four commonalities among deceptive reviews: Word counts tend to be longer, but word length is shorter and less complex. Many reviews end in multiple exclamation points and often make references to family members. “Because it is often difficult to create concrete details in their messages, they have a tendency to include details that are unrelated to the focus of the message,” the study states.

Edmunds released two examples of Humankind reviews to TIME magazine. One of the reviews read, “Well worth the money! Amazing service, highly recommended! Do not bother looking anywhere else, these guys will take good care of you,” while the other stated: “I was very happy with the Advisor, he even gave me his cell phone number. Everyone was very friendly and helpful, even those who weren’t working on my car.”

Levin offers additional insights on how Edmunds staffers spot fake reviews. “What we’re looking for in reviews are people’s descriptions of their experience as opposed to just conclusionary statements like ‘It was great,’ ‘It was horrible,’ or ‘She was fantastic.’ We’re not so much interested in your emotions as we are in facts that people can use to make their own judgment [when choosing which dealership to visit].

“If others come in similar in terms of tone, then people at our shop might say, ‘What else do these reviews have in common? Can we trace them back to the same source?’ And you have to see a pattern of it, because if it’s just one, that’s probably just someone who writes a review that reads that way.”

Levin says Yelp had not flagged any of the 25 dealerships associated with Humankind. He claims, though, that at least one of the fake reviews appeared on DealerRater’s website.

Responding via e-mail, Larry Cochran, DealerRater’s senior vice president for products and services, stated that he was unaware whether the site had fallen victim to fraudulent reviews from Humankind, but added that the company welcomes “the private sharing of findings by Edmunds so that we may thoroughly investigate through our fraud prevention team.”

Regulators on Reviews

Review sites have to cater to customers and businesses, but they also have to play by the rules of federal or international regulators. That’s why Lowe considers Yelp to be a partner to entities like the Federal Trade Commission (FTC), which actively pursues companies creating deceptive online testimonials.

Mary Engle, associate director for the FTC’s advertising practices, says the agency is concerned about fake reviews and the harm they cause for consumers. “Nowadays, it’s very common to go online and look for reviews of products and services that you’re considering and see what people are saying, and it’s important for those to be truthful,” she says.

She adds that she cannot comment specifically on whether the FTC is investigating Humankind and its fraudulent dealer testimonials. However, she says “it’s good that there are also these private lawsuits” to act as deterrents for companies that set up fraudulent accounts to submit reviews on behalf of consumers. While she says the FTC can file a court or administrative order against such a company, the agency cannot always seek monetary damages.

“We’re entitled to get refunds for consumers,” she says. “In this kind of situation, it’s very difficult to assess what the damages caused to the consumer would be.”

Both Edmunds’ and Yelp’s lawsuits are pending. GlowingReviews.co remains dormant while AdBlaze appears to be operating as usual. Interestingly, BuyYelpReview.com now leads to an apparently unrelated opinion article published in the Oakland, Calif.-based East Bay Express. The headline reads: “Yelp and the Business of Extortion 2.0.”