Dear Multi-Level Marketer. Stop it. Stop all promotions that push your products by claiming they prevent or treat COVID-19. Stop all misleading or unsubstantiated promotions that push your business opportunity by claiming people can earn substantial income peddling your products. The claims are unproven and deceptive. Whether you or your distributors are making them, you’re responsible. That means you could be breaking the law.
That’s the message of warning letters that FTC staff has sent to six multi-level marketing companies (MLMs). The letters direct the companies to report within 48 hours what actions they’ve taken to immediately stop all use of health and earnings claims that the FTC says are unsubstantiated and therefore violate truth-in-advertising laws.
MLM businesses rely on a network of independent distributors, sometimes called business opportunity participants, to advertise, buy, and resell their products, often through direct person-to-person sales or online. MLMs typically offer participants a cut of the sales made by people the participant recruits to invest in the business opportunity. The new recruits then try to sell the products, and try to recruit more people to do the same. Most people who join MLMs make little or no money.
The warning letters – the second group that the FTC has sent to MLMs – cite marketing claims, some in Spanish, that have appeared in social media posts and videos. They include claims focused on fears about COVID-19, worries about loss of jobs and income, or both. Here’s a list of the companies that received FTC warnings, and some of the marketing claims that drew the FTC’s attention:
Youngevity International, Inc., of California. Health claims, some in Spanish, appeared on the company’s own website and in distributors’ social media posts and videos. Among them:
- On the company’s website: “flattenthecurve Shop Immune Support” linking to a page displaying the company’s “immune support” products for sale.
- “With these, your body will be able to withstand and eliminate Covid-19 and the vaccines forthcoming for Covid-19. Also get your Rebound FX – Stay Safe. #youngevity #flattenthecurve #covid19 #coronavirus”
Melaleuca Inc., of Idaho. Earnings claims, including:
- “[B]efore you say ‘ that’s not enough money’, please consider EVERY DIRECTOR at Melaleuca has been getting a paycheck through this entire pandemic/crisis!... $400/month income – FOREVER…. This income will NEVER go away!”
Isagenix International LLC, of Arizona. Health and earnings claims, including:
- “In the fight against COVID-19 . . . . Isagenix shakes boost your immunity 500%!”
- “Will you get a stimulus check?.... [W]ould a extra $4,100 change your family lifestyle? Well my firm is offering that and more . . .”
The Juice Plus+ Company, of Tennessee. Health and earnings claims, including:
- “I for one will NEVER take a vaccine for the #WuhanVirus #KungFlu. I have never had an influenza shot why the hell would I get this one? And I have never had the flu as an adult. #JuicePlus @juiceplus”
- “There are a lot of people out there who have lost income . . . . You may want to build a side income, you know, make $500 a month, $1,000 a month or more. There’s no ceiling on this. It’s whatever you want it to be.”
Plexus Worldwide, LLC, of Arizona. Health claims, including:
- “#VIRUS_CORONA Worried? I’ve been boosting my immune system for several years with high-quality Plexus supplements. You can too! #Plexus provides excellent all-natural supplements that truly work. Be sensible –not fearful. Scientifically formulated & doctor-approved! Ask me!”
- “[H]ow do you protect against the virus in the first place? By giving your immune system an ‘energy upgrade’. Your immune system requires a TON of energy to fight the virus. Without enough energy, the virus wins and triggers runaway inflammation. So, it’s CRUCIAL to get your immune system the energy it needs. These can help!!” above an image of four Plexus Worldwide products.
Vivri USA, LLC, of Texas. Health claims, all in Spanish, including:
- A video in which the narrator, while describing the contents of a Vivri product, states “…y otros minerales que van a hacer que nuestras defensas se incrementen o se fortalezcan y una persona saludable, una persona bien nutrida, va a poder hacerle frente a este tema del coronavirus…. Lo que necesitamos es hacer que nuestro cuerpo active las defensas que van a proteger contra este virus.”
Translation: “…and other minerals that are going to increase or strengthen our defenses, and a healthy person, a well-nourished person, will be able to face this coronavirus issue…. What we need to do is make our body activate the defenses that will protect us from this virus.”
With respect to unsubstantiated health claims, FTC staff reminds the companies that, under the FTC Act, claims that a product can prevent, treat, or cure a serious disease require the support of well-controlled human clinical studies at the time the claims are made. The products these MLMs and their distributors are touting are not scientifically proven to treat or prevent COVID-19.
With respect to deceptive earnings claims, FTC staff notes that under the FTC Act, “claims about the potential to achieve a wealthy lifestyle, career-level income, or significant income are false or misleading if business opportunity participants generally do not achieve such results. Even truthful testimonials from participants who do earn significant income or more will likely be misleading unless the advertising also makes clear the amount earned or lost by most participants.”
If you’re a member of the MLM industry, the FTC’s guidance can help you apply core consumer protection principles to your business practices.
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