Reiterates Importance of Anti-Pyramid Statute Protection for Consumers Across the U.S.

(WASHINGTON D.C.) – The announcement by the Federal Trade Commission and state of Arkansas regarding a settlement with the “Blessing Loom” BINR scheme highlights the value of and need for strong anti-pyramid laws and effective regulatory enforcement.

The anti-pyramid statute used by the state of Arkansas was passed in 2019 and supported by Direct Selling Association (DSA). This action further demonstrates that a statute clearly distinguishing between pyramid schemes and legitimate direct selling companies is a vital tool for law enforcement. Additionally, it highlights the importance of truthful income and earnings claims in the marketplace. 

DSA President Joseph N. Mariano said, “We remain committed to working with state legislatures and Attorney Generals on anti-pyramid consumer protection legislation, which is now law in most of the country. Pyramid schemes prey on participants, promise rewards for the mere recruitment of other participants without regard to real product sales to actual consumers, and misrepresent potential earnings.”

Mariano continued, “DSA wholeheartedly supports prosecution of entities which violate these laws. Legitimate direct selling companies compensate salespeople for real sales to real users and work hard to ensure claims regarding earning are truthful and non-misleading. It is a main focus for the DSA to protect consumers from misrepresentations and deceptive practices through its own DSA Code of Ethics and third-party regulatory organizations like the Direct Selling Self-Regulatory Council of the BBB National Programs.” 

See www.dsa.org for more information about these important safeguards.

Media Contact:
Ginger Greenberg
ggreenberg@sunwestpr.com

ABOUT THE DIRECT SELLING ASSOCIATION

For more than a century, the Direct Selling Association (DSA) has served as the national trade association for companies that offer entrepreneurial opportunities to independent sellers to market and sell products and services, typically outside of a fixed retail establishment. In 2022, direct selling took place across the United States, generating $40.5 billion in retail sales and 6.7 million entrepreneurs in the U.S. sold products or services through the direct selling channel, providing a personalized buying experience for 40 million customers.