On July 27, the BBB National Programs Direct Selling Self-Regulatory Council (DSSRC) held the inaugural Direct Selling Summit, which brought together direct selling industry executives, legal professionals, advertising experts, and salesforce members. Following a busy year of marketing problems for direct selling firms and their independent salesforce members, the virtual Summit, an educational event designed to provide individuals in the direct selling sector an inside look at how their advertising is monitored, took place.
The Direct Selling Summit featured three panels with in-house and outside lawyers, as well as business compliance officials, who reviewed the current challenges affecting the direct selling sector. The Summit’s keynote included Mary Engle, BBB National Programs’ Executive Vice President of Policy, in a one-on-one discussion with Beth Delaney, Attorney Advisor to FTC Commissioner Noah Phillips, from the Federal Trade Commission. Eric D. Reicin, President and CEO of BBB National Programs, gave the opening comments. In our program guide, you can learn more about the programs and speakers that attended the Direct Selling Summit.
Participants in the first panel, Between the Lines: Staying Out of Legal Trouble, discussed a tsunami of compliance that has swept the direct selling business in recent years, embracing a consumer-centric approach. More specifically, the panel discussed the FTC’s advocacy for increased use of its penalty offense authority, which places companies on notice of deceptive acts or practices in litigated administrative cases and then seeks civil penalties against notice recipients if they engage in those acts or practices after receiving the notice. The panel also reviewed the Federal Trade Commission’s decision that it will review the Business Opportunity Regulation, which comes amid requests for a new rule that would encompass direct selling businesses and give a foundation for obtaining civil fines for false earnings claims.
In her keynote address, On the Record with the FTC, Beth Delaney stated that we may expect more rulemaking from the FTC in the future, with an emphasis on individual defendant responsibility. Ms. Delaney stated in her one-on-one interview with Mary Engle that more freedom in rulemaking would allow the FTC to implement more imaginative and broad remedial remedies, with a stronger emphasis on consumer redress and legally compelled restitution of ill-gotten earnings earned by wrongdoers.
The third and final panel, Salesforce Best Practices: Strengthening the Branches, brought the event to a conclusion by continuing the essential discussion about sales executives and their downline sales staff maintaining open lines of communication. Many of the issues stated by previous panels, such as the need for salesforce monitoring, adherence to social media best practices, and the essential role a salesforce plays in a direct selling company’s brand integrity, were repeated by this panel.
