The FTC sent warning letters to ten multilevel marketing companies because of claims they or their sellers are making about their products’ ability to treat or prevent coronavirus, or about the money people can earn if they’ve recently lost income.
The FTC sent letters to Arbonne International, doTerra, Modere, Pruvit Ventures and Total Life Changes, each of which sell essential oils, supplements or related products, covering both health claims and income claims.
It also warned supplements company IDLife, weight loss and nutrition product company It Works Marketing, and skincare product company Rodan & Fields about earnings claims, and wellness product company Zurvita just about health claims.
Multilevel marketing companies typically work with non-salaried “representatives” that sell products directly to consumers, often earning commissions for their sales and the sales of those they recruit for their “downline.” Many such companies have been criticized for making questionable health claims about their products in advertising.
“Two concerns that you have to be aware of when you’re a MLM participant,” said FTC Regional Director Chuck Harwood. First, you want to make sure that you’re passing on reliable information.”
“There’s simply no substantiation that the kinds of products that are being marketed and sold through these MLM schemes will prevent someone from contracting COVID-19 or help you recover from COVID-19 any faster than you would otherwise,” Harwood said
Another big problem is inflated claims about the money you can make with a network marketing business.
“You have to be very careful if you’re investing in one, be sure that the promises of how much money you’re going to make, are actually truthful. a lot of times they’re inflated,” Harwood said. “A lot of times, what we find is that people who get into these kind of schemes- whether it’s related to COVID-19 or anything else- find that they lose far more money than they ever make.”
