User-generated content (UGC) has become a core part of influencer marketing, but it also comes with compliance risks. The Federal Trade Commission (FTC) closely monitors how brands and creators disclose material connections in social media posts.
A report by the European Commission found that nearly 97% of influencers post commercial content, yet only one in five consistently labels their posts as advertising.
This puts your brand at risk of penalties, account suspensions, consumer backlash, and lost trust.
When you are familiar with FTC guidelines for user-generated content, you can create compliant campaigns that protect your brand while keeping your social media posts authentic and engaging.
In this blog, we’ll cover:
P.S. Worried your social media campaigns might be crossing FTC rules or missing proper disclosures? inBeat Agency specializes in UGC compliance and influencer strategy. We help you create authentic, fully compliant social campaigns.
Consumers rely on social media influencers and user-generated content to make decisions, but without proper disclosures, those decisions might not be as informed as they should be.
Let’s dive into why disclosures matter and how they help protect both your brand and your audience.
The FTC’s Endorsement Guides require influencers and UGC creators to disclose any material connection with brands when endorsing products. This includes personal, financial, or family relationships.
So, what exactly is a material connection?
Well, it’s anything that ties the influencer to the brand in a way that could influence their recommendation. Whether you’re being paid, receiving free or discounted products, or even just have a personal connection to the brand, if there’s a connection, it must be disclosed.
When followers see a post, they need to know if the endorsement is based on genuine opinion or influenced by incentives. Disclosures keep recommendations honest and help brands maintain trust.
The FTC’s goal isn’t to overcomplicate the process but to ensure transparency and protect consumers.
And here’s where it gets serious. According to the same European Commission report we referenced earlier, 30% of influencers didn’t share basic company details like an email or business name.
Even worse, 38% skipped platform disclosure tools, instead using vague terms like “collaboration” (16%), “partnership” (15%), or just a casual thanks to the brand (11%).
This kind of inconsistency shows why brands must train their creators and double-check disclosures before content goes live.
If you're working with UGC creators or influencers, advise them to disclose any material connections with your brand, whether it's financial, employment, personal, or a family relationship.
Transparency is key, even if they weren't directly asked to promote your product but received free or discounted items.
Don’t just assume your audience knows about these connections; be clear and upfront.
Remember, if creators are showing any kind of endorsement, whether it’s through tags, likes, pins, or comments, they need to disclose it. Yes, even those little likes and tags are endorsements in the FTC’s eyes.
If you’re creating UGC with influencers or handling your own branded posts, you need to:
And when it comes to language, keep it simple. A quick note like:
For example, check out how Lena Levcenco, a UGC creator, uses a simple but effective disclosure:
Lastly, don’t even think about using fake social media influence, like bought followers or bots. That is prohibited by the FTC and can seriously damage your brand's reputation.
When you are collaborating with UGC creators, make sure to follow these key FTC guidelines to ensure your campaigns remain transparent and compliant:
Note: If the creator is simply sharing their honest opinion about a product they purchased, no disclosure is required. But once there’s a material connection, like compensation or free products, it must be clearly disclosed.
For example, in this post by mdn_fit, the gym name is visible in the background, but there’s no sponsorship or paid promotion involved.
As a brand working with user-generated content, the Consumer Review Fairness Act (CRFA) is crucial to ensure you handle customer feedback in an honest and transparent way.
This law gives customers the freedom to share their experiences, whether positive or negative, without fear of retaliation.
Here’s how this impacts your brand:
Take this example from Carpe’s website. Instead of removing a 1-star review, the brand kept it live and replied with a thoughtful response offering solutions. This shows compliance with the law as well as commitment to customer care:
This act makes it clear: you can’t control the narrative, but you can manage how you respond to it with transparency and fairness. Encourage your audience to leave their honest reviews, as this helps strengthen your brand’s authenticity and trust.
In May 2025, the FTC took action against Empire Holdings Group LLC for violating the Consumer Review Fairness Act. The company was accused of making false income promises and suppressing negative customer reviews, which is prohibited under the law.
They claimed consumers would quickly earn $10,000 per month (or more) with their AI-powered stores/programs. They even said they would build and launch a “cash-flowing online business” in as little as 30 days.
This case shows the importance of respecting consumer feedback and transparency when working with UGC.
When you’re building campaigns with UGC, reviews can make or break credibility. The FTC is crystal clear: reviews must come from genuine customers, not from cherry-picked or fake sources.
Therefore, keep these essentials in mind:
Do’s
Don’ts
As Alessandro Bogliari from Forbes Councils Member, puts it:
“Violating the rules can lead to penalties, fines, and legal fees. In 2016, for example, a video network settled with the FTC over undisclosed payments to online influencers. In 2014, an advertising agency working for Sony landed in hot water for urging its employees to promote a gaming console on Twitter without disclosing their relationship to the agency or Sony.”
When you keep reviews authentic, it keeps your UGC campaigns compliant and strengthens long-term trust with your audience.
For more details, check the FTC’s official guide on soliciting and paying for online reviews.
Compliance is not just a box to check. It forms the foundation for building trust with your audience. When you manage UGC creators the right way, you protect your reputation, avoid penalties, and maintain credibility. Clear disclosures, transparent review practices, and honest partnerships set the standard for authentic campaigns.
Key takeaways
If you want to scale UGC campaigns without worrying about compliance headaches, inBeat Agency can help. We specialize in influencer partnerships and compliant UGC strategies.
Book a free strategy call now and safeguard your campaigns while maximizing engagement.
What are the FTC guidelines for influencer content?
The FTC requires influencers to disclose when they have a material connection with a brand, such as payment or free products. Disclosures must be clear, easy to spot, and placed within the endorsement message itself. Brands are equally responsible for ensuring their influencer marketing complies with the rules, not just the creators.
What are the 4 Ps required by the FTC for advertising?
The FTC’s 4 P’s stand for prominence, presentation, placement, and proximity. Disclosures should be noticeable, in plain language, and positioned near the claim or endorsement. They cannot be hidden in long captions, profile bios, or at the end of videos. These principles ensure transparency and help audiences clearly understand when content is advertising.
Can I use influencer content as UGC without an #ad tag?
No. If the influencer received free or discounted products or had any financial or personal connection with the brand, the content must carry a disclosure like #ad or #sponsored. Without a clear disclosure, you risk violating the FTC Act. Honest, visible tagging keeps campaigns compliant and helps preserve audience trust.
Are reviews considered endorsements?
Yes. Individual reviews on websites, social media, or platforms like YouTube count as endorsements if they can influence consumer decisions. The FTC requires that reviews reflect honest opinions from genuine customers. If reviewers have a material connection to the brand, that connection must also be disclosed. Fake or manipulated reviews are prohibited under the FTC Act.
What counts as a “material connection”?
A material connection is any relationship between a creator and a brand that could affect how consumers view the endorsement. This includes payments, free or discounted products, affiliate links, employment, or even family ties. The FTC expects all material connections to be clearly disclosed in social media posts, live streams, and digital advertising campaigns.
Can I ask customers to leave positive reviews?
No. The FTC prohibits brands from requesting only positive reviews or offering incentives tied to positive feedback. You may ask customers to share honest reviews of their experiences, but they must be free to post both positive and negative feedback. Transparency and fairness in consumer reviews are protected under the Consumer Review Fairness Act.
