Singapore’s crackdown on fake reviews exposes business of buying ‘social proof’

Singapore’s biggest crackdown so far on fake online reviews has exposed how businesses exploit the appeal of five-star ratings to game the system, with experts warning generative AI will make fake reviews more rampant and consumers need to be more discerning of what they read online. The Competition and Consumer Commission of Singapore (CCS) has taken action against 45 companies – including a funeral parlour, law firm and an aesthetics clinic – after finding they bought reviews from a provider whose services included artificial intelligence-generated testimonials resembling real customer experiences. The companies had to remove the reviews and post a public apology for six months as part of the first phase of investigations. About 100 companies were involved. Alton Chua, associate professor at Nanyang Technological University’s Wee Kim Wee School of Communication and Information, said online review ecosystems were constantly evolving. “Some companies will always try to game the system while users learn to adapt their trust in what they read. In fact, AI has already entered the landscape: companies are using AI to generate fraudulent reviews while smart shoppers are using it to spot them,” Chua said. “With the advent of GenAI, we can expect fake reviews to be more rampant. For one, it is virtually free for unscrupulous merchants to create realistic and human-like text that is indistinguishable from authentic customer feedback,” he added. Elmie Nekmat, associate professor of communications and new media at the National University of Singapore, said reviews were powerful because they provided “social proof”. “A five-star rating, for example, can influence consumers to pay attention to a particular company before they even get a chance to examine the business in detail or the choices that they have,” he said. “In Singapore, under the consumer-protection framework, to deliberately mislead consumers through fabricated reviews also constitutes unfair trade practices.” The two-phase investigation was the CCS’ largest fake review inquiry to date, with its second stage currently under way. There were 47 businesses CCS investigated in the first phase and two declined to provide undertakings on the commission’s required terms. CCS said it would continue its investigations and take firmer enforcement action if necessary. Investigations found that Julian Tung Yan Kai provided fake review services to about 100 businesses. Tung was the sole director of Reputifly and owned and operated websites BuyReviewSG and GetReviewSG, which provided fake review services. Tung eventually provided such services to some 100 businesses who would buy packages of fake reviews to be posted periodically and they could use a rating calculator to work out how many five-star reviews they needed to reach their desired Google rating. The provider used GenAI to create reviews designed to resemble genuine customer experiences by varying writing styles and sentence structures, incorporating details such as Singapore context and introducing natural imperfections. Clients were able to edit the generated reviews before publication. CCS told This Week in Asia that Tung promised to stop providing fake review services and voluntarily committed to donating proceeds to charity, without claiming any tax deduction from the donation. Criminal red lines CCS has said posting or procuring fake reviews can be considered an unfair practice under the Consumer Protection (Fair Trading) Act 2003 (CPFTA) because it could mislead consumers into believing a business is more popular or of higher quality than it really is. “Unlike some criminal statutes, the CPFTA does not ordinarily make the act of posting fake reviews a stand-alone criminal offence,” said Joyce Khoo, a criminal lawyer from Quahe Woo & Palmer. Instead, the commission might investigate the business, seek court injunctions to stop the conduct, require the removal of fake reviews, and mandate corrective measures such as public apologies, she added. According to Khoo, criminal exposure generally arises where the business obstructs the investigation or disobeys a court order, and the company and potentially responsible individuals may face contempt of court proceedings. CCS similarly noted that under CPFTA, engaging in an unfair practice was not a criminal offence and did not attract fines or financial penalties. However, if the business failed to comply with a court injunction, CCS might commence contempt of court proceedings, which could result in a fine or imprisonment. It listed a case involving a managing director of Nail Palace Entities who was jailed for three months last year for persistently failing to comply with a court order stemming from CPFTA. What about influencers? On whether influencers and key opinion leaders paid to rate services were also a form of fake reviews, Elmie said: “Paying a KOL or influencer to promote a product is not inherently deceptive if the person clearly discloses the commercial relationship and genuinely communicates their experiences.” He noted that, conversely, a fake review created the impression that an independent consumer had a genuine experience when that person either did not or might not actually exist. Chua said fake reviews tended to be associated with bots, anonymous users or those whose identities were obscure, while the use of influencers usually involved the complimentary use of products or services under review. “Because these endorsers are well known, the reviews they write command greater perceived credibility,” Chua said.