DSSRC Administrative Closure #250

The Direct Selling Self-Regulatory Council (DSSRC) contacted a direct selling company (“Company”) regarding certain earnings claims that were disseminated on social media by the Company’s salesforce members. All but one of the posts at issue were disseminated on Facebook and the remaining post was found on Twitter. DSSRC contacted the Company and expressed concern that these social media posts could be reasonably interpreted by consumers as meaning that the Company’s business opportunity provides salesforce members with financial freedom, time freedom, passive income, or residual income.

The Company promptly responded to DSSRC’s inquiry and stated that its internal team has diligently worked to address all concerns raised by DSSRC. The Company further stated that it takes compliance with FTC and industry guidelines seriously and, accordingly, it took further action by launching their own internal affiliate audit to ascertain noncompliance.

The Company noted that with respect to the posts identified by DSSRC, each non-compliant post was buried deep in the respective social media feed, the accounts were short-lived and all nine members are gone and have not been active with the Company for two years. When the Company attempted to contact the nine salesforce members responsible for the posts, they noted that the emails bounced back and the individual seemed to be either unreachable or unresponsive. Notwithstanding, the Company was able to resolve all but one post. In addition, the Company also provided a list of each of the salesforce members, with the date they became inactive. The Company also demonstrated to DSSRC that it was attempting to work with Twitter to remove the one remaining social media post at issue. DSSRC agreed that this action was necessary and appropriate. DSSRC has stated in several previous inquires, when a company is made aware of a problematic claim that was made by an inactive salesforce member it is expected that the direct selling company will make a good faith effort to contact that individual and request that the inaccurate post be disabled.[1]

Based upon the Company’s good faith actions to address DSSRC’s concerns, the inquiry was administratively closed.

(Administrative Closure #250, closed on September 8, 2022)

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