Direct Selling Self-Regulatory Council Refers Health-Related Product Claims and Income Representations by Aloe Veritas, Inc. to the Federal Trade Commission

Direct Selling Self-Regulatory Council Refers Health-Related Product Claims and Income Representations by Aloe Veritas, Inc. to the Federal Trade Commission

New York, NY – Oct. 9, 2019 –The Direct Selling Self-Regulatory Council (“DSSRC”) has referred certain marketing claims made by Aloe Veritas, Inc. (“Aloe Veritas” or the “Company”) for its wellness and skincare products to the Federal Trade Commission for possible enforcement action after the Company failed to provide a statement indicating whether it will comply with DSSRC’s recommendations to modify or discontinue such claims. The health-related product claims at issue in DSSRC’s inquiry were regarding product efficacy as well as claims that a certain Aloe Veritas’ product was “physician recommended” and “clinically designed.” The income representations at issue concerned the amount of money that salesforce members could be reasonably expected to earn from selling the Company’s products.

DSSRC is the direct selling industry’s self-regulatory forum and a division of BBB National Program, Inc.’s self-regulatory and dispute resolution programs. The subject marketing for Aloe Veritas came to the attention of DSSRC through its own independent monitoring of the direct selling marketplace. In particular, DSSRC requested substantiation for both the health-related product claims and the income representations made by the Company and its salesforce members.

The health-related claims reviewed by DSSRC were representative examples of those made generally in the marketplace on behalf of Aloe Veritas and included:

• “Aloe vera leaf is a miraculous healing food that is one of the oldest healing remedies and natural antibiotics in the world. Taken internally, aloe works wonders for assimilation, circulation, and elimination.

It is known to purify the blood, reduce inflammation, ease arthritis pain, prevent kidney stones, lower high cholesterol, prevent Candida, boost physical endurance, benefit cardiovascular health, and protect the body from oxidative stress.

It also soothes ulcers, hemorrhoids, gastritis, diverticulitis, colitis, irritable bowel syndrome, and other digestive disorders. Aloe provides recovery from fatigue and aids in muscle function as well as optimal utilization of several vitamins, minerals, and enzymes. It’s alkaline nature, helps to soothe acidosis and alkalinize the whole body.

Aloe vera is excellent for healing as it reduces poisons & toxins in the intestinal tract so that they don’t travel up to the liver. This makes it highly beneficial for eczema, psoriasis, acne, rosacea, blood sugar issues, sibo, bloating, gallstones, weight issues, brain fog, dehydration, uti’s, vitiligo, sinus problems, lupus, yeast infections, and strep. Start your detox today!”

With respect to these health-related claims, the Company acknowledged that its policies prohibit such claims (including claims that its products prevent, diagnose or cure diseases or illness) and stated that it notified its representatives of this fact. Accordingly, based on the acknowledgment that the subject claims are prohibited by the Company’s policies, DSSRC recommended that Aloe Veritas have these product performance claims removed from circulation and take steps to ensure that similar product and health-related claims are not disseminated in the future by the Company or its representatives.

DSSRC also determined that an unqualified claim that a product was “Physician Recommended” may imply to consumers that a significant percentage of physicians recommend the product in their practices. The Company indicated that it would voluntarily revise its marketing to remove the “Physician Recommended” claim. Aloe Veritas, however, stated its intention to replace such claims with the following:

• “CLINICALLY DESIGNED SCAR THERAPY - NuDerma MD is a patented formula created to noticeably reduce scarring and smooth skin imperfections.”

DSSRC determined that the claim “clinically designed” could be interpreted by a reasonable consumer as being the functional equivalent of a “clinically proven” health claim. Based on the evidence submitted in the record, DSSRC concluded that the Company did not possess competent and reliable scientific evidence to support such a claim and, therefore, recommended that Aloe Veritas discontinue use of a “clinically designed” claim.

 In its inquiry, DSSRC also identified the following representative income representations on the Aloe Veritas website:

• “We give you the means to achieve an extraordinary level of success”
• “It is completely up to you to decide how much profit you wish to make and which rung on the career ladder you wish to reach.!”

DSSRC determined that such income claims could be interpreted by a reasonable consumer to mean that the typical individual engaged in direct selling of Aloe Veritas’s products was likely to achieve a significant income and/or achieve extraordinary success. While Aloe Veritas indicated it would discontinue the earnings claims in question from the Company’s website, the claim “It is completely up to you to decide how much profit you wish to make and which rung on the career ladder you wish to reach” remained on the Company’s website as of the date of DSSRC’s decision.  In addition, in connection with any future atypical earnings claim, DSSRC recommended that the Company include a clear and conspicuous disclosure (i.e., a prominent disclosure in close proximity to the triggering claim) indicating the typical earnings that could be expected by a reasonable consumer in the scenario presented.

In accordance with DSSRC’s Policies and Procedures, DSSRC requested that the Company provide a statement indicating whether or not it would comply with DSSRC’s recommendations or appeal DSSRC’s decision. However, despite DSSSRC’s repeated requests to Aloe Veritas, the Company did not provide such a statement. Accordingly, pursuant to its Policies and Procedures, DSSRC has referred this matter to the FTC for possible law enforcement action. DSSRC’s full written decision is available at: https://bbbprograms.org/programs/all-programs/dssrc/cases-and-closures-details/case-number-5-2019.