DSSRC Administrative Closure #282

The Direct Selling Self-Regulatory Council (DSSRC) contacted a direct selling company (“Company”) regarding six earning claims disseminated on social media by Company salesforce members. The claims at issue were disseminated on Facebook, Instagram, YouTube, and the Company’s website. DSSRC expressed concern that these social media posts could be reasonably interpreted by consumers to mean that the Company’s business opportunity provides salesforce members with significant income and a lavish lifestyle.

The Company promptly responded to DSSRC’s inquiry and began contacting the salesforce members responsible for the claims at issue to have the posts removed. The Company was successful in removing or significantly modifying five of the six claims that were identified by DSSRC. With respect to the remaining claim, the Company indicated that it reported the post to the social media platform, in addition to commenting directly on the post regarding the inaccuracy of the claim.

DSSRC determined that the actions taken by the Company were necessary and appropriate. Section 6 of the DSSRC’s Guidance on Earnings Claims for the Direct Selling Industry 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 “residual income,” “unlimited income,” “full-time income,” “replacement income,” “quit your job,” or any substantially similar statements or representations.

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

(Administrative Closure #282, closed on 7/10/23)
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