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Is That Ad Even Legal? Understanding False Advertising Laws


— June 10, 2025

Trust comes from honesty, not tricks. Whether you’re buying a product or running a business, truth in advertising helps everyone win.


We see ads everywhere! on TV, social media, websites, and billboards. But not all ads tell the truth. Some make big promises that aren’t real. This is called false advertising, and it can trick people into buying something based on lies. Many countries, including the U.S., have laws to protect consumers from these unfair practices. Let’s break down what false advertising is, how it affects you, and what the law says about it.

Quick Look: Pros & Cons of Advertising

Pros and Cons of Advertising; table by author.
Pros and Cons of Advertising; table by author.

Types of False Advertising You Might Not Notice

Some ads don’t lie openly, but they still trick you. These are sneaky forms of false advertising that many people don’t even realize are misleading. One common trick is “bait-and-switch”. A store advertises a product at a low price, but when you get there, it’s sold out or never existed, and they try to sell you something more expensive.

Another example is misleading product claims, like calling something “clinically proven” or “doctor recommended” without showing any proof. Then there is fake reviews, companies sometimes pay people to write positive reviews or use bots to boost their ratings. Even fine print in ads can hide important details like extra fees or subscription traps.

These tactics can make a product seem better or cheaper than it really is, which can lead to wasted money and broken trust.

Is It Illegal? What the Law Says About False Ads

Yes! False advertising isn’t just wrong, it can also be illegal. In the U.S., the Federal Trade Commission (FTC) is the main agency that watches over ads. If a business makes false, misleading, or unfair claims, the FTC can investigate and take action. This might include big fines, lawsuits, or forcing the company to correct its ads.

There are also state laws that protect consumers. For example, some states allow people to sue a company if they were tricked by a false ad. And if the product causes harm, things can get even more serious legally.

The law doesn’t only focus on what’s said in the ad, it also covers what’s left out. If a company hides important information (like side effects or extra charges), that can also be considered false advertising.

Your Rights as a Consumer

If you’ve been misled by a false ad, you have the right to speak up and take action. Here’s what you can do:

Flag of the United States Federal Trade Commission; image by United States Federal Trade Commission (FTC), Public domain, via Wikimedia Commons. Deceptive debt collectors banned.
Flag of the United States Federal Trade Commission; image by United States Federal Trade Commission (FTC), Public domain, via Wikimedia Commons.
  • File a Complaint with the FTC: Report the ad online at reportfraud.ftc.gov.
  • Ask for a Refund: Many companies offer refunds if a product was falsely advertised.
  • Leave an Honest Review: Warn others by sharing your experience online.
  • Contact Local Consumer Protection Offices: Some states allow you to file claims for refunds or damages.
  • Take Legal Action: In serious cases, you can sue the company in small claims court.

Business Owners, Beware: How to Stay on the Right Side of the Law

Running ads is a great way to grow your business, but saying the wrong thing can land you in trouble. As a business owner, it’s important to keep your marketing honest and clear. Don’t make promises your product can’t keep, and avoid using tricky words or fine print that could confuse your customers.

Always back up your claims with facts. If you say your product is “proven to work,” you should have real proof. Be honest about prices, terms, and results. Also, avoid using fake reviews or paying influencers without clear labels like “sponsored” or “ad.”

It’s a good idea to have a lawyer or legal expert review your ads, especially if you’re launching something big. Following the rules helps you build trust, keep loyal customers, and avoid fines or lawsuits. In short, honest ads are good for both your business and your brand.

The Bottom Line: Can You Really Trust That Ad?

Not every ad is bad, but not every ad tells the full truth, either. Many brands use catchy words, perfect photos, or bold claims to grab your attention. As a consumer, it’s smart to slow down and take a closer look. Check reviews, read the fine print, and look for real facts, not just hype.

If something sounds too good to be true, it probably is. Ads are meant to sell, but they shouldn’t lie. Trust comes from honesty, not tricks. Whether you’re buying a product or running a business, truth in advertising helps everyone win.

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