The Direct Selling Self-Regulatory Council (DSSRC) has maintained a steady flow of government referrals in 2023, underscoring its dedication to upholding compliance standards for the direct selling channel.
In January 2023, the Council referred Perfectly Posh, a Salt Lake City, Utah-based personal care and beauty company, after the company and its salesforce representatives made multiple income claims, including several claims about “replacing your income” and achieving “career-level income.”
Efforts by DSSRC to contact Perfectly Posh through a November 2022 Notice of Inquiry yielded no response from the company. Despite subsequent outreach, including a 10-day notice, Perfectly Posh did not provide a response to DSSRC’s inquiry, prompting the matter to be referred to the Federal Trade Commission (FTC).
In March 2023, the Council made a government referral for earnings claims disseminated by Karatbars International, a marketer of small gold bars and gold gift items headquartered in Germany.
Company representatives made claims of “Financial Freedom,” and “Generational Wealth,” aggressively portraying the message that the business opportunity would provide career-level income.
Despite most posts being accessible in the U.S. and Karatbars maintaining an official English-language website, DSSRC struggled to find contact information. The website lacked a phone number or email address for inquiries, but DSSRC found the founder’s email and a support email. After the initial 15-day period passed without a response, DSSRC issued a 10-day notice on Feb. 9, 2023, warning that without a response the matter would be referred to a government agency.
Health and wellness direct seller Wayal Health Sciences USA was referred to the FTC in May 2023 for non-compliant product performance claims. Representatives of the Salt Lake City, Utah-based company claimed on social media that the products would help fight cancer, depression and ADHD. There were also claims of improved memory and a reduction in the risk of Alzheimer’s disease and skin cancer.
The DSSRC repeatedly tried to engage Wayal Health, sending a Notice of Inquiry on April 5, 2023, and later, a 10-day notice on May 1, 2023. Despite receiving automated responses from the company, Wayal Health did not provide substantive answers regarding the claims in question. Additionally, phone contact attempts were unfruitful, as a company representative hung up upon being informed of the inquiry. Notably, the social media posts under scrutiny remain unchanged and publicly accessible.
In June 2023, the Council referred cryptocurrency services direct seller iCoinPro to the FTC for earnings claims made by salesforce members as well as by the company itself on social media and the official company website. Problematic claims included “Financial Freedom,” “living comfortably without the worry of financial obligations” and “3 to 4k weekly” income.
The Council reports that iCoinPro has not provided any evidence supporting the income levels portrayed in its marketing materials. Despite multiple attempts to contact the company, iCoinPro failed to respond, while misleading income claims continue to circulate on social media and its website. Consequently, in accordance with DSSRC policies, the matter has been referred to relevant government agencies, including the FTC.
Tori Belle Cosmetics, a Woodinville, WA-based direct seller, was the target of the DSSRC’s most recent government referral. The Council’s inquiry concerned 12 earnings claims made by company representatives. The problematic statements, which were posted on Facebook and YouTube, included claims such as “replacement income,” “Who wants a free vacation?,” “financial freedom,” and “how about we transform your bank account…”
The council reports that Tori Belle failed to provide support for the claims questioned by DSSRC, instead asserting that the dates of the posts were altered and that the claims were over 3 years old, originating from inactive salesforce members. The company emphasized its vigilance in monitoring salespeople and preventing inappropriate claims.
Despite initially responding to DSSRC upon receiving the Notice of Inquiry, Tori Belle failed to engage further or provide evidence to support the identified earnings claims. Although the Council made multiple follow-up attempts regarding alleged post alterations, the company did not respond.
The DSSRC reports that, contrary to Tori Belle’s claims, all 12 posts in question remain publicly accessible and none were posted prior to 2020, with two being less than 1 year old at the start of the inquiry.
Despite a written request from DSSRC for Tori Belle to provide a Company Statement in response to the report, the company neither submitted such a statement nor indicated any intention to comply with the report’s recommendations. As a result, in accordance with section VI (E) of DSSRC’s Policies & Procedures, DSSRC referred the matter to the relevant government agency for potential law enforcement action.