Testimonial use in MLMs

We already know that MLM often sell products with absurd health claims. Health claims that are not allowed by law. See here, here, and here about the laws around what health claims are allowable.

People in MLM schemes end up with products that are usually overpriced and of little actual use. The only way they can sell these products is to exaggerate their uses and make it sound like it has magical qualities. Have a look at TINA’s findings of false health claims made by MLMs.

Hence, you see posts like this on Facebook-

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However, these sorts of claims are frowned upon by the law, advertising authorities and the companies themselves. The companies tell their reps, outwardly at least, that they must not make health claims. They have compliance departments that are supposed to be finding these claims and asking their reps to stop.

If these wildly inacurate and illegal claims are not allowed, how are people supposed to sell them?

Juice Plus have come up with a great idea. Share testimonials. Then people are not making claims, they are just sharing stories. Here is an email from their compliance department to a Bot Watcher.

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“If someone has seen that the product has helped them with a specific condition, then we encourage them to tell their story in the first person”.

 

“share this story with your readers or tag them in the post.”

 

 

From this belief sprung the Juice Plus Testimonials page on Face Book. Here, people tell stories about how they took Juice Plus and their health condition improved. Here is a selection of some of those testimonies-

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You can find any medical condition there and use their stories to put on your own page if you are selling Juice Plus and want to make health claims without actually making health claims. Reps end up discussing their customers and working out which of their products to recommend. Totally not making any health claims though. Here’s an example of one such discussion.

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Well there you  go, The shakes must be ok in pregnancy, the rep says so. Even though she has no training. I’ve looked up the ingredients to see if there is any vitamin A in the shakes. There isn’t. Vitamin A can be found in their capsules, but not the shakes. I did find something interesting though. There was a link to click that was labelled

“California residents: Click here for Proposition 65 WARNING.”

I don’t live in California but thought I’d click anyway. This is what I found

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The shakes can cause birth defects. This is pretty serious and it concerns me greatly that reps are telling other reps and customers that it is safe because they used it and they were ok.

It should be pretty obvious that sharing testimonials is a very bad idea. We don’t know the truthfulness of these claims and they could be very harmful. People may try and come off their medications, or have false hope for their condition. There are many, many conditions catered for on the Facebook page and shared widely.

The Law in the UK

Section 15 of the non-broadcast CAP advertising code states what sort of claims can be made for foods or food supplements.

 

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So claims that Juice plus capsules can replace anti depressants would not be allowed. The claims that can be made are very clearly set out I these registers. But what about personal testimonies? Is it ok for someone to say that a product has helped with a condition?

There are some general rules that marketers must comply with when sharing testimonials-

  1. The marketer cannot be the consumer and give their own testimonial.
  2. The marketer must have written permission from the person making the testimonial.
  3. The marketer mush hold evidence the claim is true- evidence of the ordering history, email records (not Hotmail, but a provable email address), address of the customer and be able to prove the testimonial is genuine.

 

This next bit is very interesting, found on this page on the CAP website.

“Marketers may not use testimonials to circumvent the Code by making claims in a consumer review that they would not otherwise be permitted to make. For example, if a marketer doesn’t hold the evidence to substantiate an efficacy claim, they cannot use a testimonial which makes that claim.

Testimonials alone do not constitute substantiation so marketers should not rely on testimonials as support for any direct or implied claims made in the marketing communication.”

What claims are Juice Plus allowed to make?

I asked the MHRA who regulate medicines and supplements in the UK if any health claims are allowed to be made by Juice Plus (and Ariix and Herbalife). This is their reply

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Essentially, this means no health claims can be made for products from Juice Plus.

I told them about the Juice Plus Testimonials page and one of their investigators joined and had a look. They were very concerned about the sort of posts there and wanted to inform Trading Standards about the group. Unfortunately though, they realised the page originated in America so they could not do anything about it.

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I never heard back about anything Facebook said. The page still exists so I am assuming they took no notice.

 

Conclusions

If you can’t make a claim for a product legally, you cannot get around it by using a testimony.

Making health claims that are not proven or allowed could lead people to believing it and ditching their medicines/ treatment. This could lead to significant harm.

If you sell a product, you cannot make your own testimonies when advertising it.

The strict rules around allowable claims are there for a reason, do not break them just so you can make a bit of money. Especially if you are taking advantage of ill people, this is despicable.

 

Xerveo bites the dust in the UK.

For a while now, there have been troubles and uncertainty within Xerveo. See previous posts on them here and here. More recently there has been widespread panic and rumour spreading from the reps. A lot of infighting has been going on and many reps are jumping ship to other MLMs.

It has been hard to find anything official on the matter though so I have not said anything up until now.

On the 5th of November 2017, Paul Holtham put this document on his Facebook page without comment or explanation.

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Paul Holtham is registered at Companies house as the director of Xerveo in the U.K.

 

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The Trading Standards letter says that Paul is no longer the representative of Xerveo in the UK and all the reps are essentially out on their own now. This letter was dated 31st October and he must have been fired a while before that for it to be mentioned in a letter from the authorities.

Paul explains what happened here in a Facebook post without actually explaining anything.

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It looks like he was fired. What for or why remains a mystery.  If you were a rep with him when it collapsed, please let me know what you were told about the reason behind all this.

If anyone has any  information on the rumours about Xerveo being merged with another MLM, I would love to see some evidence please.

Advice to Xerveo reps

If you intend to remain with the company, please read the Trading Standards letter and consider if you are willing to take on that level of responsibility.

If you are owed money for products you paid for and never got, consider talking to your bank/credit card company. A few reps have had their money refunded to them when they havenmt had their goods within 14 days.

If you are a rep who has decided to join another MLM, please be very careful in your choice. I have written an article aimed at helping you avoid the worst MLMs. Please have a look for some tips. Do not blindly follow your team. Consider your options carefully and independently of others.

 

Xerveo updated

There have been a few developments in the Xerveo story so I have added them here, to avoid messing up the original article.

The company address

There were some issues with the company address in the last post. The address given for Xerveo was 31 Albert Road, Broadstairs which was a normal house. There was another address as well, for Parcel Distribution Ltd, 2 Harold Road, Cliftonville, Margate.

Someone commented on the last post that the 2 Harold Road address was the accountant’s address. This may well be true, and maybe there is an office in the care home that is rented out? What I wanted to know was, where is the warehouse or parcel distribution centre where all the stock is being sent so it can be distributed? There is no address for it anywhere. Where is the warehouse? Where are the vans? The admin staff?  Where is the actual business?

Then I came across this label that has been shown to reps by Paul Holtham, the owner of Xerveo and the Parcel Distribution centre.

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The address is given as 31 Albert Road. A normal house on a residential street. It’s not a proper distribution centre at all.

This picture brings us to another story.

Where is the coffee?

Months ago reps ordered coffee that still has not arrived. There is general concern in the ranks as to what has happened to the coffee they ordered. If you to to the Xerveo website now, you will see it is all out of stock.

This is what you see when you click on any of the products

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Apparently, it has been like this since the website was shut down for the change to the ‘binary’ system at the end of August 2017.

People have started asking question and Paul (the registered owner of Xerveo in the UK) has given an explanation on Facebook. On 27th September 2017, an insider has sent me Paul’s explanation-

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Does this sound reasonable to you? Would HMRC destroy stock because of a mistake counting the it? Would a reputable company headquarters in America respond by waiting for the return of it and then send it back? None of this sits right with me.

Has a delivery really been stopped at the airport? If so, why? Is it Not For Resale? No one has been able to provide proof that it is legitimate and allowed to be sold in this country.

Has the coffee been sent to this country at all? Have Xerveo realised it can’t be sold here and stopped providing it?

Paul has provided the above label at the top of this post as evidence the delivery is imminent. This shows nothing though.

The Health claims

I have spoken to one of the leaders and explained about how they cannot make health or weight loss claims in the UK for their coffee. He has taken note and the message seems to have spread to all the leaders. I have since been asked by someone from within Xerveo to amend my article about health claims. It is true, the health claims have dramatically reduced, well done. The one featured in my last article has been removed. Thanks for listening guys.

Reps now seem to be not mentioning the products or company at all. They’ve completely hidden everything, going all mysterious.

Other concerns

I have looked into Xerveo a little further and a few other niggles have cropped up.

Name Change

Xerveo used to be called Ferveo and then it changed, apparently without any explanation. December 2012 they announced on Facebook they were changing the name and website, via a call to some of the reps. They gave a Ferveo website address that I was going to look at so I could see what happened, but I got this message.

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I didn’t feel brave enough to continue.

 

Better Business Bureau

I had read that they had an F rating due to the many complaints from reps and customers so I looked it up. This is what I found

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I wonder what it is being updated to? Look at the section it is filed under.

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The Ingredients

Here are the ingredients in one of the coffees

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Ganoderma Lucidem is a mushroom. As stated in the last post about this mushroom, there are no health benefits to consuming this mushroom. But are there any bad side effects?

Organo Gold had this ingredient in their coffee and they were sued because of the dangerous side effect of blood thinning.

This is what WebMD has to say about it.

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Conclusion

Is this a pyramid scheme with no products to sell? If it is, this is an illegal pyramid scheme. Well done to the reps who have taken heed of my advertising warnings. Please be vigilant of anything that might be dodgy. Let me know if you see anything that concerns you. Alternatively, let me know if I have anything wrong. Keep an eye out for updates. Thank you to my sources who have provided me with information.