DSSRC Administrative Closure #305
The Direct Selling Self-Regulatory Council (DSSRC) contacted a direct selling company ("Company") that sells bath and body products regarding four social media posts that communicated earnings claims and two posts that communicated health related claims. DSSRC expressed concern about the posts conveyed claims regarding the potential income that a typical salesforce member could earn from the Company's business opportunity, including the possibility of achieving “financial freedom” and that the typical Company salesforce members could earn up to “$500 per month.” The health-related claims included representations that Company products could effectively treat headaches, psoriasis and eczema. The claims were disseminated on Facebook and Pinterest.
Upon initiating the inquiry, the Company promptly took corrective action to address the identified social media posts, successfully removing all six posts brought to its attention by DSSRC. DSSRC acknowledged that the Company's actions were necessary and appropriate. As outlined in Section III of the DSSRC Policy and Procedures, DSSRC evaluates the truthfulness, accuracy, and substantiation of earnings and product claims made by direct selling companies and their salesforce members.
More specifically, Section 6 of DSSRC's Guidance on Earnings Claims for the Direct Selling Industry states that some words or phrases, such as "financial freedom," carry a high risk of being misleading when communicated in a general context. Moreover, as a general rule, claims about the health benefits or safety of foods, dietary supplements, drugs, and other health-related products require substantiation in the form of competent and reliable scientific evidence.
In conclusion, DSSRC found that the Company made a bona fide, good-faith effort to address concerns by promptly removing the six identified posts. The inquiry was administratively closed based on the Company's demonstrated good faith actions in addressing the issues brought to its attention.
(Administrative Closure #305, closed on 01/23/24)
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