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International Sales Reps’ COVID-19 Claims Bring Problems Home For US Supplement Direct Seller

International Sales Reps’ COVID-19 Claims Bring Problems Home For US Supplement Direct Seller

Source : 'HBW Insight'

A US direct selling firm’s statement that it will ask international sales representatives to pull fraudulent claims for dietary supplements to treat COVID-19 isn’t sufficient to assuage an industry self-regulation group’s concerns.

“Despite several requests by” BBB National Programs Inc.’s Direct Selling Self-Regulatory Council, Gano Excel USA Inc. “did not provide information indicating if the salesforce members responsible for the posts were active or inactive sales members and did not provide copies of take-down requests and/or termination letters to such salesforce members as a demonstration of [Gano Excel’s] due diligence and good faith efforts to address DSSRC’s concerns and remove the problematic claims from circulation,” according to a report published on 13 January.




Gano Excel's ganoderma, above, and cordyceps, below, supplements were featured in independnet sales representtaives' social media posts with covid-19 claims.

DSSRC reviewed ad claims posted on social media for the Chino, CA-based firm’s products, including posts made in Spanish, Burmese and other languages other than English, as part of its ongoing monitoring of direct sellers’ advertising.

The BBB National Programs division’s report noted claims including:



“GanoDerma is a Antiviral, Anti Tumor, also Aides In Blood Pressure, Aides In Diabetes And So Much more.”


 “10 Foods That Help Boost Your Immunity to Fight COVID-19”


“Boost your immune system with Cordyceps… Great for reducing stress and slowing down the aging process, this daily supplement strengthens both body and mind”


“Ganoderma Lucidum can help you combat and prevent all these complications by regulating glucose levels.


“Ganoderma can also help treat for the Corona Virus, when the Virus enters your body, Ganoderma destroys it because it is an anti viral, anti bacterial and anti fungal [sic]. It does not allow the cells to expand those of the corona virus.”

Gano Excel didn’t dispute the claims in the social media posts identified by the DSSRC should not have been disseminated and removed five of the 17 challenged posts, the report states.

Gano Excel didn’t provide a statement to include in the DSSRC report and didn’t respond to HBW Insight’s request for comment on questions about the group’s findings.

Indicating the claims were made by its independent contractors, “many of whom were located overseas,” the firm informed the DSSRC that it contacted the contractors responsible for the challenged posts and that “most have been taken down.” Gano Excel also said it drafted termination letters for salesforce members not adhering to its request that the claims be taken down.





“Notwithstanding this representation and while several of the posts emanated from overseas, a number of the active posts include US area codes and contact email addresses and appear to have originated in North America,” stated DSSRC attorneys who reviewed the claims.

They added that they acknowledge a direct seller may not be able to require its independent sales representatives to remove a social media post. But the “DSSRC nonetheless recommends that the direct selling company make a bona fide good faith effort to have the improper claim removed.”

The attorneys said based on “the aggressive and unsupported health-related claims communicated in the social media posts at issue,” they recommend Gano Excel “take all necessary steps to contact the salesforce members who disseminated the posts and request that they be removed.”

The DSSRC also reviewed claims about potential incomes from selling Gano Excel’s goods that its sales representatives made. While the firm “conceded that the amount of income promised in the social media posts  … was excessive and not representative of the amount of earnings that could be typically expected by potential Gano salesforce members,” the “DSSRC remains extremely concerned that the posts at issue remain active and readily accessible by consumers.”

The DSSRC was established by the Direct Selling Association in 2019 and is administered by BBB National Programs to improve accountability and bolster consumer confidence in the direct-selling channel. ()

The DSA, which includes nutrition supplement and personal care firms Nu Skin Enterprises Inc., Herbalife Nutrition Ltd., Mannatech Inc., Reliv International Inc., Amway Corp. and Arbonne International LLC among its 130 members, worked with BBB National Programs in 2020 to develop guidance aimed at curbing ads with inflated earnings potential claims, which increased among health and wellness direct sellers during the COVID-19 pandemic. ()

The Federal Trade Commission also has targeted direct sellers with making fraudulent COVID-19 claims for consumer health and personal care products as well as for preying on consumers economically harmed by the pandemic by making false claims about potential incomes. ()

By Malcolm Spicer