The FTC recently imposed hefty fines on four high-profile diet supplement companies in a growing effort by the agency to curb deceptive advertising in the weight loss product industry. In all, the weight-loss marketers will pay approximately $34 million for consumer redress.
The FTC will make these funds available for refunds to consumers who bought the products. Here is a list of the products fined.
Sensa. The marketers of the powdered food additive Sensa will pay $26.5 million to settle FTC charges for making unfounded weight-loss claims and misleading endorsements. According to the FTC, the marketers, deceptively advertised to consumers that they could "sprinkle, eat, and lose weight" essentially without diet or exercise. The lesson: don't let your client make outlandish claims about well-settled ideas like the necessity of diet and exercise. It's not puffery, it's deceptive.
L'Occitane. The maker behind Almond Beautiful Shape and Almond Shaping Delight skin creams will fork over $450,000 to the FTC. L'Occitane also agreed to stop making deceptive claims that its creams have body slimming capabilities ("Trim 1.3 inches in just 4 weeks!") and are clinically proven ("Clinically proven slimming effectiveness."). The lesson: be very careful about scientific claims.
HCG Diet Direct. The marketers of HCG Diet Direct Drops deceptively advertised an unproven human hormone found in human placenta. According to the FTC, the hormone has been "touted by hucksters for more than half a century as a weight-loss treatment." Marketers made false claims of rapid weight loss through videos, product packaging, and website testimonials; made false claims that the product was FDA approved, and; failed to disclose that some endorsers were compensated. Although the company's $3.2 million judgment is suspended due to their inability to pay, the lesson is clear: getting into the biz of unfounded trends *cough* placenta "science" *cough* invites a deluge of legal trouble.
LeanSpa. The FTC and the state of Connecticut shut down owner Boris Mizhen's operation, including LeanSpa and three other companies he controls. Mizhen used fake news websites to promote acai berry and "colon cleanse" weight-loss products, made deceptive weight-loss claims, and misled consumers about the actual costs of the "free" trials. LeanSpa will surrender assets totaling an estimated $7.3 million in a partial settlement with the FTC. The lesson: don't bury the actual price in the fine print.