Earnings Claims

Earnings representations and disclosures by direct selling companies has long been a subject of interest related to direct selling. The following information outlines provisions related to earnings claims that can be found in the DSA Code of Ethics, the World Federations of Direct Selling Associations’ Code of Ethics. It also looks at the federal and state regulatory framework with regard to earnings claims.

US DSA Code of Ethics

The U.S. Direct Selling Association’s Code of Ethics sets forth the basic fair and ethical principles and practices to which member companies of the Association will adhere in the conduct of their business. Read more about the US DSA Code of Ethics »

World Federation Code(s) of Ethics

The World Federation of Direct Selling Associations (“WFDSA”) also has spoken to the earnings representation question in its code of ethics directed towards direct sellers. Read more about the World Federation Code(s) of Ethics »

Federal Legal Framework

It is well established that commercial advertising can be regulated by the federal government. For direct sellers, at least two types of advertising fall into the category of commercial speech: earnings claims and testimonials. Read more about the Federal Legal Framework »

State Statutory Standards

Some states have laws or regulations which specifically regulate or prohibit earnings claims made by certain direct selling companies. In particular, Georgia, Louisiana, Maryland, Massachusetts and Wyoming have statutes which prohibit companies from making false representations about potential earnings. Read more about the State Statutory Standards »