Case #80-2022: Government Referral – Fifth Avenue Collection, Inc.

BBB NATIONAL PROGRAMS

The Direct Selling Self-Regulatory Council

Case Number 80-2022: Government Referral – Fifth Avenue Collection, Inc.

Company Description

Fifth Avenue Collection, Inc. (“Fifth Avenue Collection” or the “Company”) is a multi-level direct selling company that sells fashion jewelry products. The Company is headquartered in Moose Jaw, Saskatchewan and has offices in Alpharetta, Georgia.

Basis of Inquiry

The Direct Selling Self-Regulatory Council (“DSSRC”) is a national advertising self-regulation program administered by BBB National Programs. This inquiry was commenced by DSSRC pursuant to its ongoing, independent monitoring of advertising and marketing claims in the direct selling industry.

The representative claims that formed the basis of this inquiry were identified on social media accounts of Fifth Avenue Collection salesforce members. Those claims are set forth below:

Earnings Claims

Need extra 💲; Need a first income?; Need a second income?”
“Whether you want a little extra mad money 💰 or a full-time income, the opportunities are endless!”
“What would you do with an extra $200, $600, or $800/month? Or even more! 💎Ask me how you can earn a great income with Fifth Avenue Collection😊”
“This past year I have tripled my income working this business from home…so has my Team…
Some gals work a full-time job and do this as a side hustle…
What would you do with an extra $500 or more a month?”
“My husband and I were 3 months married working full time jobs. We were looking for a tax advantage and to make extra income. Along came Fifth Avenue - Beautiful Jewellery! The jewellery sold itself and in the first year of the business I tripled my full time income. 29 years later still loving what I do and make an average $100.00 an hour.”
“What would you do with an extra $500/month?”

“How about easing the stress of how to pay the bills, financial freedom, save for a vacation, just less stress?... and you start earning $$$ right away! It’s easy, fun & and instantly profitable!”
“Being a Fifth Avenue Collection Jewelry Stylist allows me to have financial freedom whilst having fun and meeting new people all at once. You could have the same opportunities with a small investment of only $55! #financialfreedom”
“What would you do with an extra $500 a month!?
‘Everyday is Payday’ at Fifth Avenue Collection! We have an amazing business opportunity for only $75 and your start earning $$$ right away!”
“Everyday is payday with Fifth Avenue Collection!
What would you do with an extra $500 a month?! Start now for only $75!”
“I LOVE the freedom to increase my earnings, there is no ceiling!”

“Could you use $500 a month?
This is for yourself or know someone trying to make ends meet or someone looking to make extra 💵 send them my way! 💝”
“Fifth Avenue Collection jewelry has changed my life so much over the past 13 years. Before Fifth Avenue, I was a shy girl who worked a lonely full-time job. That has totally changed with the help of Fifth Avenue's mandate of "people helping people". With a much higher income than before, working only part time hours that I set, I have time to spend with family and friends, especially my grandbabies. #fulltime #partime #youdecide”
“Save for a vacation, pay for your children’s activities, cover bills & other expenses, your Plan B !?! the possibilities are endless!
If you know someone trying to make ends meet or someone looking to make extra 💵 send them my way! 💝”
“…an income that covers as many bills as I need”

DSSRC informed the Company of its concern that such earnings claims may convey a message that consumers and/or potential salesforce members would typically earn significant income from the direct selling opportunity.

Company’s Non-Participation in the DSSRC Process

On June 30, 2022, DSSRC sent a Notice of Inquiry by email to Fifth Avenue Collection’s Training and Marketing Development Director at its Alpharetta office. After not receiving a reply within fifteen business days, DSSRC sent a hard copy of the Notice of Inquiry as well as a second email to the Training and Marketing Development Director on July 29, 2022.

After the Company failed to provide a response within 15 business days, DSSRC continued to try to contact the Company and sent a 10-day notice to both Fifth Avenue Collection’s Training and Marketing Development Director as well as the President of Fifth Avenue Collection on September 7, 2022 indicating that, if the Company failed to provide a response to DSSRC regarding the claims and issue within 10 business days, the matter would be referred to the appropriate government agency.

Notwithstanding the additional opportunity to respond to DSSRC’s inquiry, the Company again failed to respond. DSSRC has also confirmed that all of the social media posts at issue remain active and accessible to the public.

Referral to the Government

DSSRC determined that a number of aggressive earnings claims are being disseminated by Fifth Avenue Collection salesforce members on social media, including claims communicating that participants in the Company’s business opportunity can generally expect to earn significant income, full-time income, between $500-$800 a month and financial freedom. All such claims appear unsupported.

As stated in DSSRC’s Guidance on Earnings Claims for the Direct Selling Industry (“the Guidance”), while DSSRC will evaluate any claim based upon the context in which the claim appears and the potential net impression of such claim to the audience, some words and phrases commonly used in earnings claims can carry a particularly high risk of being misleading to consumers. Such words and phrases include claims such as “financial freedom,” “full-time income,” “replacement income,” “residual income,” and “career-level income.” Furthermore, earnings claims must be substantiated and representative of a level of earnings that can be generally expected by the audience.

DSSRC remains concerned with the earnings claims that were communicated by the Company’s salesforce members. While DSSRC will evaluate any claim based upon the context in which the claim appears and the potential net impression of such claim to the audience, 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 “quit your job,” “be set for life,” “make more money than you ever have imagined or thought possible,” “unlimited income,” “full-time income,” “replacement income,” “career-level income,” or any substantially similar statements or representations. Other terms, such as “passive income” and “residual income,” are prohibited when they convey that income can be continuously earned by salesforce members with little or no ongoing effort. 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,” and “time freedom.”[1] Accordingly, DSSRC was concerned that the claims listed in the Basis of Inquiry communicate the message that Fifth Avenue Collection salesforce members will typically earn significant income from the Company’s business opportunity.

In accordance with section (II)(9) of the DSSRC Policies and Procedures, in the event the company whose marketing is the subject of a DSSRC inquiry fails to participate in the self-regulatory process, DSSRC may refer the matter to an appropriate government agency for review and possible law enforcement action. 

Accordingly, based upon Fifth Avenue’s Collection’s failure to respond to the self-regulatory inquiry and address DSSRC’s concerns, this matter has been referred this matter to the Federal Trade Commission.

(Case No. 80-2022. Closed on September 29, 2022)

[1] Id at section 6.

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