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The gist is that the item being advertised has to be the actual item as offered to the consumer. So in a cereal ad, the cereal featured has to be the actual cereal (even though they may go through hundreds of boxes picking out the perfect corn flakes to use). However, since they're not actually selling the milk that goes with the cereal, they're free to use glue or some other liquid that will let the cereal maintain it's crunch or otherwise enhance photography.

So they are selling real flakes and a fraudulent crunch. Still fraud.

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