DSSRC Administrative Closure #239
The Direct Selling Self-Regulatory Council (DSSRC) contacted a direct selling company (“Company”) regarding certain earnings claims that were disseminated on social media. The claims at issue originated from two posts disseminated on Facebook.
DSSRC was concerned that the posts communicated earnings claims suggesting consumers could easily earn passive income, early retirement, secure income, and generational income by pursuing a business opportunity with the Company. Both posts originated outside of the United States.
According to section 1 of DSSRC’s Guidance on Earnings Claims for the Direct Selling Industry, it is misleading for a direct selling company and/or its salesforce members to make any earnings claims unless the direct selling company and/or its salesforce members (A) have a reasonable basis for its claim at the time the claim is made; and (B) have documentation that substantiates the claim at the time the claim is made.
The Company acknowledged that the claims in the context presented were inappropriate and took the prompt actions to facilitate removal of the posts. DSSRC agreed that the Company’s actions were necessary and appropriate.
Based upon the Company’s prompt efforts to address DSSRC’s concerns DSSRC administratively closed the inquiry.
(Administrative Closure #239, closed on June 9, 2022)
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