The New York Attorney General just ordered 19 companies to pay over $350,000 between them in penalties, after they were discovered astroturfing. In an initiative called Operation Clean Turf, it stalked firms who were paying for fake reviews on social media sites, and late last month, it shone a public light on them, naming and shaming the culprits.

Astroturfing got its name from the term 'grassroots', alluding to movements in which large numbers of people stand up for or endorse something. Some companies and institutions are tempted to fake their own grass roots campaigns, using bogus accounts to post positive reviews of their services.

In many cases, they'll even advertise for others to do it. "We need someone to post 1-2 reviews daily on sites like: Yelp, Google reviews, Citysearch and any other similar sites," said one such advertisement, on a popular site for freelance jobs, cited by the attorney general's office. "We will supply the text/review. You must be able to post these without getting flagged."

In some cases, firms paid search engine optimization companies to manage the process for them. People from as far away as Bangladesh were paid to shill for the companies on review sites. IP addresses were cloaked so that it wasn't obvious where the 'reviewers' were from, said lawmakers.

The US isn't the only country that comes down hard on astroturfing (which violates federal FTC rules, too). Hiring paid shills is an excellent way to get yourself in trouble in the UK, too. In its Consumer Protection from Unfair Trading guidance, the Office of Fair Trading forbids "falsely representing oneself as a consumer," (a point alluded to in the CIPR's social media guidelines).

The Advertising Standards Authority's UK advertising code says that marketing communications must not materially mislead by omitting the identity of the marketer. 'Marketers must hold documentary evidence that a testimonial or endorsement used in a marketing communication is genuine, unless it is obviously fictitious, and hold contact details for the person who, or organisation that, gives it," it adds.

Several firms have been caught red-handed and red-faced. Reverb Communications, a marketing company for videogames, settled with the FTC after it was found posting fake reviews of clients' games on Apple's iTunes App Store. Nashville-based Legacy Learning Systems paid the FTC $250,000 to settle charges that it generated $5m in sales by paying 'ad affiliates' to post reviews online.

But fines aren't the biggest worries facing those caught astroturfing; reputational damage is far worse. To be caught paying for positive comment implies to potential customers that you can't get it for real.

A strong, authentic voice goes further than a 'spray and pray' fake review campaign. Engaging genuine customers online and publicly inviting them to tell their stories for free is more effective than trying to prop up hundreds of shill accounts to make them look real.

While the New York Attorney General's victory is encouraging, it is also very small. These 19 firms are the tip of a large, sleazy iceberg. Gartner predicted a year ago that at least one in ten online social media reviews would be fake by 2014, warning CMOs that any short-term gains are likely to be outweighed by the long-term reputational damage of this unethical practice.

From the Salesforce Partner Zone: 5 social media steps to earn customer and organisational trust