Misrepresentation is commonplace, even outright fraud is commonplace. Serious fraud is a multi-billion dollar industry. "Light fraud" and gray area misrepresentation is at least hundreds of billions of dollars a year.
The "free market" doesn't make fraud or misrepresentation illegal, the laws and regulations of the dreaded government do.
The worst the free market can do to a fraudster is to stop dealing with her as knowledge of her frauds becomes widely known. That, of course, doesn't work very well to limit fraud.