DSSRC Administrative Closure #233

The Direct Selling Self-Regulatory Council (DSSRC) contacted a direct selling company (“Company”) regarding certain earnings claims and one product performance claim that were disseminated on social media by the Company’s salesforce members. The claims at issue included sixteen (16) posts that were disseminated on Facebook and YouTube, and included unlimited income (e.g., “Unlimited income potential”) and financial freedom income claims (e.g., “Start your financial freedom now”). DSSRC expressed its concern to the Company that these posts communicated statements of atypical earnings regarding the amount of income that could be generally expected by the typical salesforce member participating in the Company’s business opportunity.

The inquiry also included a product performance claim that DSSRC determined may be reasonably interpreted as conveying an unsupported message that Company’s products are effective in treating eczema.

The Company promptly responded to DSSRC’s inquiry and agreed that the earnings claims at issue in this inquiry were unsupported and should not have been made. The Company was able to have the fourteen (14) of the social media posts taken down shortly after DSSRC commenced this inquiry. As for the two remaining posts, one has been duly revised and the problematic language removed, while the other, which concerns the YouTube video, was designated as private by the Company salesforce member. DSSRC subsequently contacted the Company regarding the video and explained that although a video post may no longer be available on the internet to a general audience of consumers, because the video at issue included claims that were unrepresentative, they should not be disseminated to even a limited audience in the context in which they were originally communicated online. More specifically, DSSRC’s concern is that problematic claims from posts or videos designated as “private” may easily be re-purposed to a select audience. The Federal Trade Commission has similarly expressed its concerns regarding private videos and posts. As such, DSSRC requested that the Company salesforce member completely disable the video in its entirety. DSSRC will continue to communicate with the Company to follow-up on the status of its request.

Notwithstanding, based upon the good faith efforts exercised by the company to address DSSRC’s concerns, DSSRC administratively closed the inquiry and indicated to the Company that it will continue to monitor the marketing claims being disseminated by Company salesforce members on social media.

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