DSSRC Administrative Closure #264
The Direct Selling Self-Regulatory Council (DSSRC) contacted a direct selling company (“Company”) that markets jewelry and other accessories regarding ten earnings claims that were disseminated on social media. All of the claims appeared on Facebook.
DSSRC contacted the Company and expressed concern that the posts that formed the basis of the inquiry included representations that prospective Company salesforce members can replace their income and “build generational wealth.” One post particular post referenced salesforce members who are “6 and 7-figure earners”.
Shortly after commencement of the inquiry, the Company promptly responded to DSSRC and immediately had eight of the posts removed and modified another to remove the reference to replacement income.
With respect to the one remaining post, the Company informed DSSRC that the salesforce member responsible for the post is no longer affiliated with the Company. The Company also provided DSSRC with three separate emails that were sent to the individual noting the inappropriateness of the post and asking her to immediately remove it. When the individual failed to respond, the Company informed DSSRC that it terminated the account of the salesforce member. Additionally, the Company indicated to DSSRC that it would nevertheless continue its attempts to contact the individual to have the post disabled and would take any further, necessary actions to facilitate removal of the post.
DSSRC agreed that Company’s actions were necessary and appropriate. Section 6 of DSSRC’s Guidance on Earnings Claims for the Direct Selling Industry notes that while DSSRC will evaluate any claim based upon the context in which the claim appears and the potential net impression of such claim to the audience, some words and phrases are prohibited when made to a general audience of prospective or current salesforce members. Such words and phrases include statements such as “quit your job,” “be set for life,” “make more money than you ever have imagined or thought possible,” “unlimited income,” “full-time income,” “replacement income,” “career-level income,” or any substantially similar statements or representations.”1
Accordingly, based upon the good faith actions taken by the Company’s to remove the earnings claims at issue in nine of the ten posts and it ongoing efforts to address DSSRC’s concerns with respect to the remaining post, DSSRC administratively closed this inquiry.
(Administrative Closure 264, closed on 1/19/23)
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 See section 6 of the DSSRC Earnings claim Guidance for the Direct Selling Industry.