‘Manipulative’ Tiktok and Insta influencers face $500k fines

Celebrity Kim Kardashian was slapped with a $2 million fine for promoting crypto and now Aussie influencers are being targeted for dishonest posts.

Social media influencers from TikTok to Instagram are being targeted for dishonest posts in a crackdown by the nation’s consumer watchdog after it was inundated with tip-offs from the public.

The Australian Competition and Consumer Commission (ACCC) has started investigating more than 100 influencers after its Facebook post attracted more than 150 tip-offs about potentially dodgy practices from influencers.

It comes after celebrity influencer Kim Kardashian was slapped with a $US1.26 million ($A1.94 million) fine in the US for failing to disclose that she was paid $US250,000 ($A385,000) for promoting a cryptocurrency.

She agreed not to promote cryptocurrency for the next three years after she was caught out.

The US Securities and Exchange Commission announced last year that it had charged the reality television star and social media influencer “for touting on social media a crypto asset security … without disclosing the payment she received for the promotion”.

Kim Kardashian spruiks a number of brands on social media. Picture: Instagram

Now the Australian watchdog is launching its own blitz on influencers particularly in beauty and lifestyle, as well as parenting and fashion, for failing to disclose their affiliation with the product or company they are promoting.

“The number of tip-offs reflects the community concern about the ever-increasing number of manipulative marketing techniques on social media, designed to exploit or pressure consumers into purchasing goods or services,” ACCC Chair Gina Cass-Gottlieb said.

“Already, we are hearing some law firms and industry bodies have informed their clients about the ACCC’s sweep, and reminded them of their advertising disclosure requirements.”

Influencers who breach Australian consumer law can face fines of up to $500,000.

Influencers in beauty and lifestyle will be particular targets. Picture: iStock

The ACCC sweep is being run over the coming weeks to identify deceptive marketing practices across the digital economy and will include Instagram, TikTok, Snapchat, YouTube and Facebook, and livestreaming service, Twitch.

It is targeting sectors where influencer marketing is particularly widespread including fashion, beauty and cosmetics, food and beverage, travel, health fitness and wellbeing, parenting, gaming and technology.

The ACCC is also considering the role of other parties such as advertisers, marketers, brands and social media platforms in facilitating misconduct.

“With more Australians choosing to shop online, consumers often rely on reviews and testimonials when making purchases, but misleading endorsements can be very harmful,” added Ms Cass-Gottlieb.

“It is important social media influencers are clear if there are any commercial motivations behind their posts. This includes those posts that are incentivised and presented as impartial but are not.

“The ACCC will not hesitate to take action where we see consumers are at risk of being misled or deceived by a testimonial, and there is potential for significant harm.”

Chair of the ACCC Gina Cass-Gottlieb. Picture: Sam Ruttyn

Many consumers are aware that influencers receive a financial benefit for promoting products and services, but the ACCC remains concerned that influencers, advertisers and brands try to hide this fact from consumers.

This can particularly apply to micro influencers with smaller followings, as they can build and maintain a more seemingly authentic relationship with followers to add legitimacy to hidden advertising posts, according to the ACCC.

It will be monitoring a mix of small and larger influencers in the sweep.