Journal Broadcast Group's KTNV-TV Las Vegas will pay $115,000 to settle an FCC investigation into the broadcasting of paid commercials masquerading as special reports.
The FCC's Enforcement Bureau said that an ad agency had paid KTNV to produce and air so-called special reports about liquidation sales at local Dodge, Chrysler, Jeep, Nissan and Hyundai car dealerships. "KTNV formatted the commercials in the style of news reports, which featured a KTNV staff person on location at the dealerships posing as a journalist," the bureau said.
Under the terms of the settlement, Journal admits to violating the commercial sponsorship identification rule, will pay the $115,000 and will create a three-year compliance plan and report periodically to the FCC.
"Broadcasters are not allowed to deceive the public by presenting commercial announcements or other paid programming in the guise of news or editorial content,” said Travis LeBlanc, chief of the FCC’s Enforcement Bureau, in a statement. “Transparency is especially crucial in a situation like this one where a pseudo news report invites viewers to rely on their perception of the station’s independence and objectivity when, in fact, the message has been bought and paid for by an undisclosed third party.”
Back in 2009, Valley Broadcasting-owned KVBC TV Las Vegas asked the FCC to investigate KTNV, alleging it had agreed to supply news coverage of one liquidation sale at an auto dealership as part of an ad buy, but did not disclose that per FCC rules.
Auto dealers are one of local stations', and particularly local news, largest advertisers.