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FTC Act

FTC Continues Its Mission Makeover and Streamlining of Rulemaking Procedures
Cover StoryDirect SellingFeatures

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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Special Edition: A Wake-up Call
Publisher's NoteSeptember 2021

Special Edition: A Wake-up Call

Our opponents are rewriting their strategies and uniting. We must do the same.

Hello readers! Since taking over as Publisher of SSN, I have remained committed to keeping you informed on the topics and trends that have the greatest impacts on the direct selling channel and its future. 

Over the past year, we have brought you stories of resilience and innovation as companies were forced to pivot after COVID-19 shutdowns. We covered the rise of the anti-MLM movement as well as the role of social media in shaping both positive and negative views of network marketing.

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September 1, 2021 0 comment
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FTC Threat: A Primer
Cover StoryDirect SellingFeatures

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
Cover StoryDirect SellingFeatures

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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How Pending Legislation Could Affect Your Company’s Compliance Strategy
Cover StoryDirect SellingFeaturesVoices

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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The FTC is on the Warpath — Time to Rally the Troops (Op-Ed)
Cover StoryDirect SellingOpinion

The FTC is on the Warpath — Time to Rally the Troops (Op-Ed)

As pressure mounts, what we do now as an industry matters

By:  Jonathan Gilliam, CEO, Momentum Factor

Opponents of the channel appear to have taken a war footing, and what we collectively do now as an industry will determine the future of this great business model we love.

Over the past 18 months, the Federal Trade Commission’s targeting of the direct sales channel has become increasingly aggressive and the channel may now be under the most intense regulatory and public scrutiny it has ever faced. Opponents appear to have taken a war footing, and what we collectively do now as an industry will determine the future of this great business model we love. 

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September 1, 2021 0 comment
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Supreme Court to Weigh In on FTC Authority to Order Monetary Relief
Cover StoryDirect SellingFeatures

Supreme Court to Weigh In on FTC Authority to Order Monetary Relief

Recent court decisions concerning Section 13(b) of FTC Act could change decades of precedent

By: David Rauf

The FTC has taken the position that the injunctive relief permitted by 13(b) allows it to disgorge revenue from scammers and corporations as well as regain restitution for victims.

“There’s an existing process outside of 13(b) for the FTC to pursue monetary relief, but it is cumbersome and requires more due process, which is why the FTC doesn’t like it.”    —Larry Steinberg, Chair, Multilevel Marketing Industry Group, Buchalter

This could dramatically affect the relationship between the direct selling industry and the FTC.     —Larry Steinberg, Chair, Multilevel Marketing Industry Group, Buchalter

The U.S. Supreme Court has agreed to decide whether the Federal Trade Commission (FTC) can continue to seek monetary rewards when it sues scammers and firms accused of deceptive business practices, setting the stage for a ruling that will have wide-ranging ramifications for the direct selling channel.

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September 1, 2020 0 comment
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