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FTC Has Seen 2,046 Complaints About Yelp In Recent Years

    April 4, 2014
    Chris Crum
    Comments are off for this post.

The FTC disclosed this week that there have been 2,046 complaints filed against Yelp dating from 2008 to March 4th, 2014. While that may seem like a lot, it’s not incredibly shocking given that we see businesses complaining informally about the site pretty much every week.

Has your experience with Yelp been positive or negative? Let us know in the comments.

Businesses often vent their frustration in article comments and elsewhere on the Internet, as well as at Yelp’s own events. They often blame the site for major losses in business, and sometimes suggest that the site is holding their positive reviews hostage when they refuse to advertise.

The FTC’s disclosure was in response to a Freedom of Information Act request from the Wall Street Journal. They sent reporter Angus Loten the complaints (most of them at least). He writes:

Most of the complaints are from small businesses that claim to have received unfair or fraudulent reviews, often after turning down a pitch to advertise on the site, according to a separate spreadsheet of complaints to the FTC about Yelp, reviewed exclusively by the Journal. For instance, a business owner in Montclair, N.J., whose name was redacted said: “I was contacted by a Yelp salesperson to advertise, which I declined, and since have only had negative posts on their site.”

Obviously Yelp has always denied that there is any relationship between advertising and reviews.

Earlier this year, The Court of Appeals of Virginia ordered Yelp to reveal the names of seven reviewers who left anonymous, negative reviews on a business – Hadeed Carpet – which says the names are critical in pursuing a defamation case against the reviewers over what it claims were false reviews from non-customers. Yelp has reportedly been held in contempt for not revealing the names.

As Loten reports, the case is headed to the Virginia Supreme Court this month. He writes that the business lost millions in revenue after the negative reviews, and had to get rid of 80 workers and sell six trucks.

Another interesting stat to come out of the report is that Yelp receives roughly six subpoenas a month, sometimes looking to get names of anonymous users.

Two months ago, another defamation case in Virginia saw an outcome in which neither party truly won. Ultimately the court decided that the two had defamed each other.

Earlier this week, we looked at a video Yelp released recently, featuring a montage of media personalities talking about and referencing Yelp:

They left out the People’s Court episode in which a business owner made claims that Yelp was prioritizing negative reviews against his company over the higher quantity of positive reviews. Yelp, he said, then contacted him, and said that if he advertised, his negative reviews would get filtered out.

Judge Milian responded, “Wow! I don’t know if what you’re saying is accurate or not, but if it is, it’s pretty outrageous.”

David Lazarus at the LA Times wrote an article five years ago asking if Yelp is a “shakedown racket for merchants,” saying that restaurant owners were saying it was “unusually aggressive in trying to get businesses to pay hundreds of dollars in monthly “sponsorship” fees to improve their ranking in search results and to move their most positive review to the top of the page.”

Lazarus wrote another article this week talking about yet another business making those familiar “extortion” claims.

“Yelp just can’t stop living the thug life,” the article begins.

None of these accusations have actually been proven so far, but there have been so many for so long, it’s hard to completely brush them off.

Either way, Yelp continues to push on with impressive financials and statistics.

Last month, the company put out a video and blog post explaining why businesses should advertise on Yelp. It didn’t mention anything about negative review filtering.

Do you believe complaints against Yelp are legitimate or is it all nonsense as Yelp suggests? Let us know what you think.

Image via Yelp (Flickr)


  • Bettina Katsaros

    We have been having a HUGE problem with Yelp. They “claim” the have this software filter system that “weeds” out “less reliable” reviews. we have actually had two cases where someone gave a poor review, came back and had a better review, then were taken down after the good review was posted. The majority of reviews that go into the “not recommended” file are 5 star reviews. Our Yelp representative claims it is all the computers doing and she cannot really explain how it works….And that there is no way to control or correct it. Meanwhile many other businesses are receiving huge amounts of 5 Star reviews from very new Yelpers…..what can we do about this>>>

    • http://www.bloketoys.co.uk/ BlokeToys.co.uk

      And I’ll bet that “representative” has an incentive to get you to pay for something, and that if you don’t they have the power to manipulate the reviews.

      This is about greed, and it seems that while the company can “officially” claim that it doesn’t manipulate the reviews, I have a feeling they know their “sales staff” have this capacity and will use it to their advantage. Plausible deniability.

      • joebob3919

        All the FTC or an enterprising investigative journalist has to do is contact a disgruntled Yelp sales person or three to dish the dirt on how the company operates internally.

    • Fred

      I’ve had the same experience. Negative reviews posted. Positive reviews mostly not posted.

    • highvoltagevape

      High-Voltage Vapes in Aurora is in the same boat. I completely understand your dilemma. The exact same thing has been happening to us. And yes…the rep from yelp said the same thing. I hope your business thrives…

      • joebob3919

        Maybe organize with other local owners to display “We Proudly Don’t $upport Yelp”

    • joebob3919

      Yelp has lost all plausible deniability, and should be seized and shutdown under RICO. Their business model is criminal, pure and simple. Also interesting, they retains lobbyist Laurent Crenshaw and organized it’s own PAC “Yelp Inc Political Action Committee”

      References:

      http://thehill.com/policy/technology/194339-yelp-starts-pac-for-political-donations

      https://www.opensecrets.org/pacs/lookup2.php?strID=C00553966

  • Sam

    I have a client who has owned perhaps the most respectable home care agency for seniors in her city for nearly two decades. The number of testimonials she receives on the Web and in writing are astounding, however there has been on single distraught client who posted a negative review on Yelp. It has remained there alone for six months and no positive reviews have been accepted by Yelp, no matter the source. As a result whenever a keyword pulls up her company, it is followed in the SERPS by the negative Yelp listing, and it has all but destroyed her business. There is definitely something amiss at Yelp.

    • http://www.bloketoys.co.uk/ BlokeToys.co.uk

      I would suggest that she spend a little money creating a couple of sites with more content about her business, which could easily knock that Yelp review out of the first page. If the Yelp review is appearing right under her actual site listing with only one review on it, it means that she doesn’t have much else out there to replace that Yelp page.

      She really needs to get her company out there more, with Twitter and Facebook pages, blog posts, articles etc… It probably would only take two or three pages of content to push down that Yelp page. Once she has done this there should be no reason for that low content page to appear beside her own listing, Google would naturally show the more thorough content instead of it.

  • Dantalion Jones

    Mixed review for yelp from me. I would get coupons on occasion from yelp. When I paid $350 / month for advertising the page views increased to 85 visits per month with ZERO extra yelp coupon sales.

    Much to Yelp’s credit I told them they are not a good investment and they are COSTING me money and NOT making me money.

    I showed them that I paid $1000 in advertising to get $100 income. That is not a “Return on Investment” but a “Loss on Investment”.

    They agreed to cancel my advertising contract.

    • joebob3919

      Yup. CAC > ARPU = Not a business.

  • Jessica

    They are bunch of THIEVES! Blackmailing people and even some reviews are of suspicious origin! That company will go DOWN. Nobody normal can do business like that!

    • John Beagle

      I think it’s more like extortion. Still you can avoid much pain by playing the game. It may cost you, but it may help you even more than before.

      • joebob3919

        You’re also free to not pay them and proudly get others to not pay them as well. Taking the easy way out just enables them to further extort and maneuver just like settling with patent trolls.

  • http://www.bloketoys.co.uk/ BlokeToys.co.uk

    There are far too many instances of this happening for it to be imaginary, I think it’s clear to all rational people that these threats are being made and actually carried out when companies refuse to pay.

    This is extortion and the US authorities NEED to investigate it completely. It’s unacceptable that this has been suggested, reported and stated in court so many times and for so long and yet no government agency has even shown an interest in investigating.

    Someone needs to look into how the sales pitch is done, what the motivations are for those calling, and what powers they then have.

    I would not be surprised if Yelp’s calling staff have an incentive to work under, and have control of the company’s profile. It would make sense that those making these blackmailing calls get a bonus for every company that agrees to pay, and if they don’t then they manipulate their on-line profile, then call back a month later to see if the threat and punishment has worked.

    Yelp needs to be investigated, and if found to have been extorting money, needs to be shut down. These running it should be fined for damages to be awarded to all those harmed by this modern mafia.

    I foresee a class action suit coming in the future.

  • http://www.mibellareina.com/ Nancy Reagan

    They are nothing but sham web advertisers. We were advertising with them on PPC basis $100 per month, and they started a new “impression” advertising program guaranteeing all of these numbers. The numbers were never there (like they stayed the same) so we went back to PPC. Now instead of $100 per month, we now magically hit $450 every month with PPC. Where are these people coming from that didn’t hit us before we were “advertising with YELP on PPC before”. The advertising rep cannot explain the numbers at all. In fact, I compared Google Analytics to our Yelp numbers. The numbers from Google analytics were about 1/2 the Yelp reporting to which my rep says:
    “In relating your numbers from Yelp to Google, they are a third party trying to capture our numbers but they aren’t going to be able to see certain things that our system sees, which is why the numbers don’t match. They do their best I am sure to try and gather all the information they can, but they will miss certain things because they are a third party trying to capture that information. I am confident in our numbers because they are internal and come from our system.” So you are telling me that Google cannot see IP addresses and know how much traffic is headed our way?? Really? Sham, flam…cannot wait for the contract to end.

    In addition, we are hit with one time reviewers that are negative and instead of going to the YELP computer heaven, these now appear on the first page of our reviews. YELP hides behind the corporate veil of being good guys just driven by their computer system that can tell whether a reviewer is fraudulent or not. What a crock of ham hock! YELP knows exactly what they are doing. Small businesses, 1 year contract, no results, and killer reviews if the business doesn’t advertise.

    In addition, I also do consulting for other businesses in my industry. Two of them have crystal-clean incredibly fabulous reputations. Both have negative reviews on YELP. Maybe if YELP was helpful to those businesses that they hurt, no one would complain. Maybe it’s their downright insolent, arrogant attitude of the staff. You know top down. I told my rep that one day I would YELP about YELP.

    • http://www.bloketoys.co.uk/ BlokeToys.co.uk

      “but they aren’t going to be able to see certain things that our system sees”

      Yep, they aren’t going to see the certain thing of their own staff being paid to click their clients’ ads to artificially inflate the cost, for example.

      Facebook has been exposed several times for charging for fake likes on ads, by groups of people in developing countries. While there is no empirical evidence to absolutely prove it, the numbers are there for all to see, compiled by some very diligent professionals who have experienced the strange patterns of likes and no engagement. There is no reason to trust these advertising methods, it’s easy to abuse and there is currently no option to combat it.

      • http://www.mibellareina.com/ Nancy Reagan

        Agreed. Cannot prove it without IP addresses though. And of course they are going to hide behind the corporate “cloak” for that one.

        • joebob3919

          Yup, PPC is only slightly less scummy than CPI. It’s extremely cheap to hide and outsource “Mechanical Turk” clickfarms in third-world countries (which pay people a fraction of a penny to click on ads that cost you 10-1000x more). Further, some even less reputable clickfarms use endpoint-deployed adware botnets to do the same thing but at the expense of hijacking random users’ computers to do their work for them. Gotta love the economics of malware.

  • amberview

    I posted a review for a local salon about 6 months ago. At first I didn’t see the review, so I looked closely at the Yelp page and found where all the other reviews go. The only reviews Yelp was showing were 2 very old negative complaints from over 3 years ago when the salon was under a different owner. There were over 20 positive reviews in the hidden section. That’s when I knew that Yelp was unreliable.

  • Ronald WhoDat Brockmann

    This is real! I once had a forum troll get mad at me and leave a negative Yelp review that was CLEARLY full of nothing but personal attacks and had no evidence to the user having used my companies services.

    The review was from a brand new user account with an empty profile (which by the way was never used again for any other reviews), yet it was posted IMMEDIATELY and spread like wildfire across the search engines. Meanwhile, real reviews from real clients of mine were being “filtered”.

    It took them 3 months to finally read the review and realize it was nothing but a personal attack.

    This racket is LONG past due for being shut down. There’s no telling how many millions of dollars were lost to those caught up in a similar scenario but when the hammer drops, we are due compensation.

    If anyone is aware of a class actions suit, please contact me.

    • Fred

      I couldn’t agree more.

  • origin

    TripAdvisor is also requesting advertising money…

    Yelp is just like TripAdvisor (TA). Got a fluffed-up negative review posted and the 3 positive reviews submitted weren’t posted. TA said, “They work for you.” One person was from Japan, another from France and the 3rd a local M.D. whose house was under construction. We are a 3 room bed and breakfast with an MD and 2 internationals on staff!?! I think not.
    Last year a client came, didn’t pay their $650 bill,took photos of basement storage and passed them off as bedroom photos with a scathing review. The good thing is we still had enough positive reviews we still achieved the TA “Award of Excellence.”

    No one at TA will pick up the phone and since we are from outside US no lawyer here or there will help us. I will look at the FTC. TA form letters show they really care more for the anonymous reviewer than the people who have dedicated their lives to serving the public.

    To the carpet people, I truly wish you the best outcome.

  • Leopard

    Yelp commercials are phony. The “actors” posing as businessman are not sincere. They prevaricate. Each and every one has shifty eyes. In addition the inflection of their voices gives them away. They are NOT credible. I’ve seen it in the court room hundreds of times, police officers included. Plainly stated, YELP is a fraud at best. It smells like clever Mafia plot, shielding its shady practices behind alleged right to freedom of speaking. An investigation by the Feds would make some surprising revelations.

  • Amber Stone

    HORRIBLE!!!! HORRIBLE!!!! HORRIBLE!!!! Former disgruntled employee fired for steeling posted 5 negative reviews that cost us valuable business each and every day over and over again…AND CAN “NEVER” BE REMOVED… A class action lawsuit needs to be filed against Yelp for their lack of accepting responsibility for irreparable damage to small businesses nationwide and force them to make changes to their corrupt advertising and online review website!

  • Patrick Crosby

    “I HATE YELP” They refuse to show my good reviews saying they are “not recommended” yet let ONE bad review be prominently displayed all over the place.Which I believe to be FAKE.I could not find this client in my data or records,I kept from beginning my company.And the things he claims are NOT procedures for my business. In short Yelp sux

  • Dee

    Yelp, is horrible. My business have 19 positive reviews, and four negative reviews. There system is so wrong because we do not promote fake reviews, but for some reason they do not post the good reviews, they only post the bad ones, and you have to scroll down and click something to see all of the reviews, but they just wont post them. awful!!!!

  • Clavendon@yahoo.com

    Yelp’s business model is pay to appear.

  • http://www.indosurplus.biz Deepika Bamotra

    Finally it has come into picture, I really hope some strict action will b taken against yelp for blackmailing businessman for paid advertising, I am a webmaster and have got same issue from 2 businessman in 2010, one from Australia and other from Canada and they wanted me to remove negative reviews on their business listing in yelp, which according to them was posted intentionally by yelp team at their refusal for advertising on yelp. Despite of there many request to remove business listing from yelp, they didnot get any response and had to bear with loss in business n potential clients.
    I seriously request to the concerned authorities to take strict action against yelp, rather I am wondering why they collected 2046 complains to speak on this issue, they would have acted way back, against yelp.

  • Soul_Tones

    The BBB tried the same thing with me- not as dramatically, and it was more of an implication, and several years ago- but in the same way, there is an inherent conflict of interest. Google cuts it about as close as one can to play both sides of the fence.

  • http://www.bloomingbeautyring.com/ Blooming Beauty Flower Rings

    We often have customers that want to leave positive reviews. So a short time ago we decided to start taking some of them up on their offers. Since Yelp seems to be all over the place, we asked them if that’s where they wanted to leave them? Shortly after the first 5 customers left 5 star reviews, we happened to notice that all of them except one, was pushed back in to this mysterious “not recommended” zone.

    The only way to see these 5 star positive reviews is to click a very obscure light grey link that is barely noticeable. A couple of our customers even went out of their way to take a picture so they could include it in their review. They wanted to be sure that everyone knew they are a real customer, and they are leaving a real review. None of that mattered. Their reviews were still pushed back in to obscurity, leaving people with the impression that they are fake.

    Needless to say, when our next customer wants to leave us a review, we won’t be telling them to go to Yelp! Since then, we have decided to sign up for iVouch, and that is where all of our customers that want to leave us a review, will be leaving it.

    I would be willing to bet that if we had decided to start paying for Yelp advertising, our 5 star customers reviews would have stayed on the front page. Thank goodness that we don’t have any negative reviews since it is likely that those would have stuck to the front page like super glue!

    Let’s not forget that “software” programs are only what people make them. Is it possible that Yelp has a couple of versions of software to weed out “less reliable” reviews? One for paying customers, and one for non-paying customers? I think the day is coming soon, that something along those lines will be exposed about Yelp. And for many small businesses out there, that day can’t come soon enough.

    Good luck to all of you other small businesses out there. It can be tough out there, but never give up or give in!

  • http://pacrelo.com/ Movers

    6 months ago we were hit with 20+ horrific reviews in a 3-4 week span bringing our business to an almost complete halt.

    The OBVIOUS bogus reviews were posted by newly registered accounts having no details, no friends, no pics and only a couple reviews posted same time/day.

    Top it off most of the reviews checked in CopyScape were 70-90% exact copies of old reviews posted on other similar type business listings. So So So evident we were under attack … what more proof needed right? Wrong……

    A month and a half later only after EXTREMELY drastic measures on our part did Yelp finally look into our 100% valid complaint.

    Know of any multi billion $$$ company that does NOT have a publicly listed available phone number ?? I do..Yelp. A tell tell sign something is NOT right.

    Nowhere on their website or anywhere I’ve been able to find, is a Phone Number publicly listed to contact them. Even the business cards they hand out to the public does NOT have a phone number. Know it for a fact… I have one….. never in my life seen similar.

    Must question Yelps A+ BBB rating despite almost 600 complaints in just the last 12 months. A MUST read are Yelp’s Boiler Plate responses justifying their do nothing stance regardless of the complaint.

    BTW Yelp…..you intentionally ignore thousands of extremely harmful reviews posted by anonymous registrants from new accounts lacking pictures, friends, bios etc,

    But yet you filter every single review I post despite my personal account being 5+ years old.. completely filled out profile, images, a ton of friends including a whole bunch of Elite Yelpers, etc etc…. Oh, I get it…. you’re decided that my opinion is meaningless.

    Yelp, get your head out of your XXXX …. You have an ethical and moral obligation to act … at minimum implement some sort of viable safe guards to demonstrate IMPROVEMENT to your blatantly flawed operation resulting in 10’s of thousands on never ending complaints.

    Almost daily we read / hear of Google continually modifying , adjusting their Algorithm attempting to improve their results… only thing heard from Yelp are lame excuses and justifications ,,,, nothing about even ONE DOLLAR spent on improvements.

  • Dean Martin

    Yelp is very similar to how the Better Business Bureau Operates! For years I ran a firm that dealt with having to ponder if paying the BBB was better (which would have given us an “accredited” status) vs. not paying the membership fee and allowing people to post whatever they wanted to – some were accurate and some were false (shake down attempts to get free services).

    I see a parallel to Yelps’ business model and there is plenty of history to support this.

    The FTC needs to take a HARD look at these types of companies as they can literally be the difference between a thriving / profitable business or an absolute LIFE CHANGING disaster (where you lose all of your assets, job, employees, etc).

  • joebob3919

    In case anyone is wondering: why isn’t there a better Yelp competitor that operates honestly: The user-base education cost, mindshare spend (would be $100 M USD) and it’s a hard-to-scale double-ended marketplace of every business and every customer. Hundreds of millions to make a dent and it’s still not sure.

    The other approach would be grassroots, co-op, open source, social enterprise model…
    again massive costs but it could work similar to the way OpenStreetMaps
    (MapQuest even uses them now) model has been gradually been increasingly successful compared to
    incumbents.