DSSRC Administrative Closure #275
The Direct Selling Self-Regulatory Council (DSSRC) contacted a direct selling company (“Company”) that markets home décor and fashion accessories regarding eight earning claims disseminated on social media by Company salesforce members. All of the claims at issue were disseminated on Facebook.
DSSRC was concerned that the social media posts from Company salesforce members communicated to consumers that the salesforce members conveyed the message that substantial income can be earned through participation in the Company’s business opportunity. More specifically, the posts included, but were not limited to, representations that prospective Company salesforce members have unlimited income potential, can earn a full-time income, earn %500 a month, leave their full-time job, and control how much income they want earn.
The Company promptly responded to DSSRC shortly after the inquiry was commenced and subsequently removed all eight social media posts.
DSSRC determined that actions taken by the Company to facilitate removal of the social media posts was necessary and appropriate pursuant to Section 6 of the DSSRC’s Guidance on Earnings Claims for the Direct Selling Industry. More specifically, the DSSRC Guidance states that “… 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 “residual income”, “unlimited income”, “full-time income”, “replacement income” “quit your job” or any substantially similar statements or representations.
Accordingly, based upon the good faith actions taken by the Company’s to remove the earnings claims at issue DSSRC administratively closed this inquiry.
(Administrative Closure #275, closed on 5/17/23)
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