DSSRC Administrative Closure #296

The Direct Selling Self-Regulatory Council (DSSRC) contacted a direct selling company (“Company”) that markets jewelry products regarding ten earnings claims disseminated on Facebook, Pinterest and YouTube by Company salesforce members.

DSSRC expressed concern that the posts communicated non-representative claims regarding the amount of income that the typical salesforce member could earn from the Company’s business opportunity, including the potential to quit their job, earn a six-figure income, and/or create a full-time income.

Following the commencement of the inquiry, the Company took prompt action to address the social media posts. The Company was successful in removing or modifying all of the ten posts identified by DSSRC.

DSSRC agreed that the Company’s actions were necessary and appropriate.  As noted in Section III of the DSSRC Policy and Procedures, DSSRC reviews earnings claims and product claims made by any direct selling company (i.e., companies who sell their products and services directly to consumers through an independent salesforce) and/or its salesforce members and evaluates the truthfulness, accuracy, and substantiation of such earnings and product claims. 

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. It is further noted in this section of the DSSRC Guidance that some words or phrases carry a particularly high risk of being misleading to consumers when communicated in a general context. Such words and phrases include but are not limited to “financial freedom.”  

In conclusion, DSSRC determined that the Company demonstrated that it made a bona fide, good faith attempt to address DSSRC’s concerns by removing the eleven posts identified in this matter. Given the Company’s bona-fide attempt to address these concerns, this inquiry was administratively closed.


(Administrative Closure #296, closed on 11/15/23)
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