DSSRC Administrative Closure #329

The Direct Selling Self-Regulatory Council (DSSRC) contacted a direct selling company that specializes in health and wellness products, particularly those aimed at promoting longevity and healthy aging. Their product offerings typically include supplements and other nutritional products designed to support cellular health, energy levels, and overall well-being. The inquiry involved 12 earnings claims disseminated on Facebook, Instagram, YouTube and on the Company website which included, among other representations, references to the “financial independence,” “financial freedom” and “financial security” offered by the Company’s business opportunity. In addition, one social media post alluded to salesforce members earning “$100 – $200 USD/Day” and another post stated “it’s easy to get over ten thousand a month.” DSSRC determined that the claims at issue conveyed messages suggesting that potential salesforce members could achieve significant and career-level income through participation in the Company's business opportunity. This inquiry was initiated by DSSRC as part of its continuous independent monitoring of product and income claims in the direct selling industry and following an investigation conducted earlier this year by a consumer advocacy group into earnings claims made by direct selling companies.

The Company reaffirmed its commitment to presenting its direct selling opportunity and potential earnings truthfully and accurately. Additionally, the Company informed DSSRC that it provides ongoing training and oversight for its salesforce members with respect to discussing the Company's business opportunity.

The Company informed DSSRC that after its receipt of the DSSRC Notice of Inquiry, it contacted the individuals responsible for disseminating the claims and requested that the posts be modified or discontinued. Consequently, the Company removed references to “financial independence and “long term financial stability” from its website and, in total, was successful in removing all but three of the 12 online claims brought to its attention by DSSRC. Two of the posts that remain publicly available were disseminated by one inactive salesforce member located in Malaysia (one of the posts is dated December 17, 2021 and the second is dated January 7, 2022). The Company provided DSSRC with a copy of the correspondence that it sent to the individual responsible for the post, requesting that it be removed. The remaining post was also disseminated by an inactive salesforce member and included the claim “acquire great wealth”. The Company attempted to contact the individual several times to have the post disabled and also provided DSSRC with the correspondence sent to the individual requesting that the claim be removed.

DSSRC recognized the Company’s good faith actions to address its concerns in this inquiry and determined that the Company’s actions were necessary and appropriate. Pursuant to section 7 of the DSSRC Guidance on Earnings Claims in the Direct Selling Industry, “all earnings claims should be supported by substantiation demonstrating that the earnings communicated in the claim are accurate as to the individual or individuals depicted in the claim … Such claims should also be otherwise truthful and non-misleading.”

With respect to the remaining posts disseminated by inactive salesforce members, DSSRC has noted in previous self-regulatory inquiries that when a direct selling company is made aware of improper claims that were made by an individual who was an active salesforce member when such claim was made but has since become an inactive salesforce member of the company, DSSRC acknowledges that the direct selling company may not be able to require such individuals to remove a social media post. In that instance, DSSRC nonetheless recommends that the direct selling company make a bona fide, good faith effort to have the improper claim/post removed.

Here, DSSRC determined the Company made a good faith effort to address our concerns removing all but three posts and taking action to have the three remaining posts removed. In addition to its attempts at contacting the individuals responsible for those post which remain publicly accessible, DSSRC recommends that the Company take additional steps to remove such claims from the marketplace including utilizing any mechanism that social media platforms may have for removal of trademark or copyright violations. DSSRC further notes that direct selling companies in past inquiries have also posted a comment on the applicable social media platform indicating that the subject post is not authorized by the company and that it has requested the individual responsible for the post have it removed.

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

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