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The DSSRC Hits Its Stride in 2021
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The DSSRC Hits Its Stride in 2021

Channel watchdog counsels companies, maintains dialogue with regulators

By:  David Bland
For the cases that get to the level of a DSSRC referral, usually there’s an issue of systemic patterns of behavior that are going on—particularly with the claims; it is rarely a one-off post, and, with respect to earnings claims, in particular, it’s often the tip of the iceberg that leads the FTC to a much deeper rabbit hole. — Peter Marinello, Vice President at BBB National Programs and Director of DSSRC
In 2019, the direct selling channel officially became a self-regulated business sector. Two years on, and the channel is reaping the benefits. Founded by the Direct Selling Association (DSA) and administered by BBB National Programs, the Direct Selling Self-Regulatory Council (DSSRC) is an independent, non-profit organization that is continuing its mission of oversight through monitoring, investigation, and enforcement of the regulations and ethics standards that have been set in place for direct sellers by the Federal Trade Commission (FTC) and the DSA.

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October 1, 2021 0 comment
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FTC Continues Its Mission Makeover and Streamlining of Rulemaking Procedures
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FTC Continues Its Mission Makeover and Streamlining of Rulemaking Procedures

Commission approves changes to ‘democratize the process’ and encourage public participation

In addition to formal rulemaking, the new changes will also apply to requests by certain parties [including the direct selling channel] for special exemption from FTC rules, as well as petitions related to industry guidance issued by the Commission. —Federal Trade Commission
Marking a continued effort to implement streamlining and overhauls to its rulemaking procedures authorized under Section 18 of the FTC Act, the Federal Trade Commission (FTC) held a virtual open meeting on Sept. 15, 2021. One of the items on the agenda was a vote to approve changes in the Rules of Practice and other rules affecting public access to the petition component of the FTC’s rulemaking process.

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October 1, 2021 0 comment
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Public Direct Sellers Post Updates for Shareholders
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Public Direct Sellers Post Updates for Shareholders

Two major nutrition companies lower projections as growth slows

As the third quarter of 2021 drew to a close, several public direct selling companies made announcements to their shareholders. Both Herbalife and USANA disclosed downward revisions to their 2021 outlooks, while Medifast, Mannatech and Nu Skin announced dividends. Herbalife Lowers Expectations in Advance of Investor Day In advance of its 2021 virtual investor day presentation, Herbalife announced on Sept. 13 that it is revising its third-quarter and full-year 2021 projections. The global nutrition company detailed lower than expected sales growth from its distributors despite the number of actively selling independent distributors increasing by 10 percent for the months of July and August compared to 2020.

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October 1, 2021 0 comment
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Positive Outlook for Public Companies
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Positive Outlook for Public Companies

Tupperware, Herbalife, USANA, Primerica lead 2020 growth; LifeVantage stumbles

By:  Dave Rauf

Tupperware

  Tupperware’s turnaround story continues to evolve. The maker of food storage containers, kitchen goods and beauty products reported its second consecutive quarter of year-over-year sales growth in the fourth quarter of 2020, according to recently released earnings.  Fourth-quarter revenue and profit were both up in the three-month reporting period. And company executives say they’re more confident that improving financials are a sign the direct selling giant is on the path to recovery after years of revenue declines and falling stock prices.

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September 1, 2021 0 comment
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FTC Threat: A Primer
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FTC Threat: A Primer

Your questions answered on the FTC’s new battle plan against direct sellers

By:  David Bland Is the direct selling channel under greater threat now from FTC action than it has been previously? All signs point to yes. While the FTC has spent the past few decades consistently taking action against several direct selling companies accused of operating as pyramid schemes, the overall scope of this action has been limited. However, over the past year, the Commission has expressly stated that the direct selling channel is on the short list for renewed FTC scrutiny and enforcement. Furthermore, in a move catalyzed by the Supreme Court decision on 13(b) to strip the agency of its restitutive monetary relief powers, commissioners have begun the process to create new weapons for winning both equitable and punitive monetary relief in future proceedings.  

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September 1, 2021 0 comment
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FTC 2.0 – In Their Own Words
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FTC 2.0 – In Their Own Words

Commissioners outline an aggressive new strategy with direct sellers in their sights.

The Federal Trade Commission is in the midst of a sea change—a change in leadership, a change in ideology and a change in philosophy. Signaling the most significant course correction of the past 40 years, the Commission is reversing a self-imposed disarmament from the 1980s deregulation era while at the same time asking Congress to strengthen its powers under the FTC Act. This revitalized Commission has also released a target list, and direct selling is on it. 

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September 1, 2021 0 comment
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Serious Business: The FTC’s Re-Deployment of the Penalty Offense Authority
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Serious Business: The FTC’s Re-Deployment of the Penalty Offense Authority

By: Kevin Grimes
From the perspective of the FTC, the POA would appear to be a perfect weapon for quickly bringing about industry-wide change.
The Penalty Offense Authority (POA) allows the Federal Trade Commission (FTC) to seek civil penalties against a wrongdoing party where: (1) a final cease and desist order has been entered against a party in an administrative proceeding under Section 5(b) of the FTC Act; (2) the order identifies a specific practice as unfair or deceptive; and (3) a party with actual notice of the order has engaged in that practice after the order became final.

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September 1, 2021 0 comment
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How Pending Legislation Could Affect Your Company’s Compliance Strategy
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How Pending Legislation Could Affect Your Company’s Compliance Strategy

By:  Larry Steinberg and William Miller
For companies that use web-monitoring services to identify possible policy violations, is it a reasonable business practice to limit the search parameters to only go back a certain number of years?
When it reversed 40 years of appellate precedent by ruling that Section 13(b) does not authorize the Federal Trade Commission to seek monetary relief, the Supreme Court relied not only on the language of Section 13(b), but also on the presence of other provisions in the FTC Act, which expressly allow the FTC to obtain monetary relief for consumers. 

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September 1, 2021 0 comment
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