The controversial Uruguayan striker admitted to Fox Sports Argentina to diving to win a penalty against Stoke City earlier in the season.
Rodgers has said that following the admission the player will be "dealt with internally" by Liverpool.
"I think it is wrong," Sky Sports News quotes Rodgers as saying. "It is unacceptable.
"I have spoken to Luis and it will be dealt with internally. "[Diving] is not something we advocate. Our ethics are correct."
Stoke won the game at the end of December 3-1, following Steven Gerrard's conversion of the penalty.