FTC's First Action Against a Social Media 'Influencer' Might Not Be Last

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The commission has updated its guidelines to make clear that social media influencers must disclose any financial or other connections to sites they endorse.

The site run by the pair, CSGO Lotto, allowed players to bet gun "skins" from the game Counter-Strike: Global Offensive that alter the look, but not the function, of weapons.

But amid growing concerns that these websites enabled minors to illegally gamble online, other YouTubers discovered that Martin and Cassell were president and vice president of CS:GO Lotto, respectively.

"Consumers need to know when social media influencers are being paid or have any other material connection to the brands endorsed in their posts", said FTC Acting Chairman Maureen Ohlhausen. The FTC will be monitoring Martin can Cassell's businesses for future infractions, any of which could carry a fine of up to $40,654.

The Federal Trade Commission has finally settled its first ever complaint against a social media influencer. Such skins can essentially be used as gambling chips, since they can exchanged at Valve's Steam Marketplace for real cash, with Valve taking a 15 percent cut.

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The decision means that neither TmarTn or Syndicate will be fined by the FTC or have criminal charges brought against them.

According to the FTC complaint, company president Martin and vice president Cassell posted videos of themselves on YouTube showing themselves winning skins on the site and telling others to gamble there. It also puts the company under increased scrutiny by the FTC's enforcement division, which monitors defendants compliance with such orders. Previously revised in 2015, the newly updated version includes more than 20 additional questions and answers addressing specific questions social media influencers and marketers may have about whether and how to disclose material connections in their posts.

This latest enforcement ties in neatly with that goal as the latest step in a series of warnings and enforcements around the topic of influencers and marketing dating back to 2009.

The FTC also claims it has sent letters to a further 21 social media influencers relating to the subject. It has also sent 21 warning letters to unname "influencers" who were contacted earlier this year about Instagram posts with undisclosed endorsements as well.

At no point does the FTC touch the issue that significant numbers of Martin and Cassell's audience are underage when it comes to gambling law.

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