WASHINGTONThe marketers of the powdered food additive Sensa have entered an agreement to return $26.5 million to consumers in what is the second-biggest deceptive advertising settlement in the history of the FTC.
The agreement was announced today as part of "Operation Failed Resolution", an FTC initiative to crack down on unsubstantiated claims by weight-loss marketers touting food additives, skin cream and dietary supplements.
In total, the defendants have agreed to pay roughly $34 million for consumer compensation, the FTC said.
According to the FTC, Sensa netted annual sales of more than $364 million between 2008 and 2012 with promises to consumers of "sprinkle, eat and lose weight". Sensa's claims of shedding weight without diet or exercise are deceptive and can no longer be made under a settlement with the marketers of Sensa, FTC said.
The FTC also announced charges against L'Occitane, which was accused of making unsubstantiated claims that its skin cream can result in slimmer bodies; and HCG Diet Direct, whose human hormone has been marketed as a weight-loss product. LOccitane, Inc. has agreed to pay $450,000 while a judgment against defendants in the HCG Diet Direct case is suspended due to their inability to pay, the agency said.
Finally, the FTC revealed a partial settlement with LeanSpa, LLC, which was charged with marketing acai berry and weight-loss products through phony news websites. The defendants in the case have agreed to surrender assets totaling an estimated $7.3 million, the agency said.
As part of its effort to crack down on deceptive weight-loss claims, the FTC also announced an online tutorial for media to help it identify deceptive claims. The agency is hoping media will reject advertisements that make such unlawful claims.
In the case against the marketers of Sensa, the FTC alleged the defendants cited studies by the product's creator and endorser Alan Hirsch as proof that consumers could shed significant pounds without exercising or dieting. During a press conference in Washington, FTC officials showed a Sensa advertisement in which one person said he lost more than 120 pounds using the product.
Jessica Rich, Director of the FTC's Bureau of Consumer Protection, characterized the chance of losing weight by "sprinkling something on your food, rubbing cream on your thighs, or using a supplement" as "slim to none".
"The science just isn't there," she said in a statement.
Under FTC rules, marketers must have "competent and reliable evidence" to substantiate their advertising claims.
CRN supports FTCs efforts to crack down on those companies making outrageous claims. All products marketed for weight-loss, whether they are sold as dietary supplements, food additives, cosmetics or homeopathic drugs, are required to have evidence that substantiates the claims they make, said Steve Mister, president and CEO of the Council for Responsible Nutrition, the dietary supplement trade organization, in a statement. FTCs announcement is also a good reminder to consumers that if something sounds too good to be true, it probably is."