DSSRC Administrative Closure #26

DSSRC inquired about two social media posts disseminated by the salesforce of a direct selling company that came to its attention pursuant to its DSSRC’s independent monitoring of advertising in the direct selling marketplace. DSSRC expressed concern that the two Instagram posts conveyed unsubstantiated product claims that the Company’s products can protect against COVID-19 virus.

The first Instagram post prefaced its discussion of the efficacy of  the Company’s products by referencing the current health-related crisis and included hashtags specifically associating the benefits of the product with treatment of the virus.  Similarly, the second Instagram post included a health-related statement accompanied by hashtags that specifically mention the corona virus.

Upon receipt of DSSRC’s inquiry, the Company was able to identify both claims, reach out to the individuals who made the posts, and have those postings removed. The Company Compliance Team spoke to each person and provided additional compliance training to the individuals.  In addition, last month, the Company CEO prepared a letter to the salesforce (i.e., to both English and Spanish speaking sales members) to advise them about impermissible COVID-19 claims.  During both calls, improper COVID claims were reviewed and an explanation was provided as to why the claims were impermissible. Moreover, the Company stated that it is implementing a new Coronavirus Compliance Policy (a copy of which was provided to DSSRC) as an addendum to its existing Policies and Procedures. Violation of the new policy, after one warning, will result in termination. The Company also created a Coronavirus Disclaimer that splashes on its homepage. 

The Company stated that it also makes compliance training available at no charge to all of its Independent Consultants and training is accessible 24 hours a day, 7 days a week. The compliance training is divided into numerous lessons, including lessons on ethics, integrity, and acceptable marketing behaviors. In addition, the Company’s compliance team regularly presents seminars in both English and Spanish internally to the employees, as well as to the Independent Consultants. The Company is also working with a third-party monitoring vendor to help assist it with identifying unauthorized claims.

DSSRC expressed its appreciation to the Company for its expedited efforts to remove the Instagram posts and the steps it has taken to address any future posts and claims suggesting that its products can treat COVID-19 and/or the symptoms associated with the condition. Based upon prompt actions taken by the Company to remove the posts, DSSRC administratively closed the inquiry.

(closed on 5/18/2020)