Fraudulent Dietary Supplement Sites Blasted by FTCFraudulent Dietary Supplement Sites Blasted by FTC

WASHINGTON--In collaboration with the Food and Drug Administration (FDA), Health Canada and certain state attorney generals, the Federal Trade Commission (FTC) has cracked down on "unscrupulous marketers who use the Internet to prey on the sickest and most vulnerable consumers." Operation Cure-All targeted six companies and their owners/presidents that were making unsubstantiated claims on their Web sites in regard to dietary supplements, as well as for devices proclaiming to provide an alternative to traditional medical treatment.

The companies included Bensalem, Pa.-based Panda Herbal International (Everett Farr III, owner); Conway, Ark.-based ForMor Inc. (Stan Gross, president); Broomfield, Colo.-based MaxCell BioScience (Stephen Cherniske, president); Palm Bay, Fla.-based Aaron Company (Robert and Lisa Spencer, owners); Mesquite, Texas-based Jaguar Enterprises (Michael Forrest, owner); and Blaine, Wash.-based Western Herb & Dietary Products Inc. (Marvin and Miguelina Beckwith, owners). Insider confirmed with the American Herbal Products Association (AHPA) and the National Nutritional Foods Association (NNFA), two of the largest industry organizations for dietary supplements, that none of the companies were members of NNFA or AHPA.

FTC raised concerns for allegedly fraudulent claims for products that included ingredients such as kava, shark cartilage, colloidal silver, DHEA, chitosan, ephedra, black walnut, wormwood and cloves. Some of these claims included that people could substitute certain dietary supplements for surgery, radiation and chemotherapy, that those with HIV or AIDS could safely use St. John's wort even though research has shown otherwise, and that certain devices could kill parasites related to cancer and Alzheimer's disease.

"Many of the Web sites targeted today are jeopardizing the health and safety of consumers with outlandish promises and false hope," said Timothy Muris, the new FTC chairman, in a press release. Additionally, Health Canada joined the U.S. regulatory bodies as a means to address fraudulent commerce between the two countries.

Because of the wide range of technology available on the Internet, FTC had set up an Internet laboratory to stay up on the newest "tech tricks," including page hijacking and meta tags. [A meta tag is hidden in the code of a Web site. Therefore, if a person types in "AIDS cure" when browsing online, a company hyping a suspect echinacea product might show up as a search result, even if the words "AIDS cure" show up nowhere on the actual site.] According to FTC senior attorney Matthew Daynard, there are many suspect dietary supplement companies left. "We haven't gotten them all this round," he said.

Five of the companies signed consent agreements with FTC to be in accordance with the Commission's guidelines. However, Western Herb & Dietary Products was taken to court because it would not sign the agreement; on June 13, the defendants agreed to a preliminary injunction while the case was pending in the U.S. District Court for the Western District of Washington, Seattle. In the agreements, the companies were asked to take various actions: to put FDA-approved disclaimers on their Web sites, to send letters to customers who bought the falsely advertised products and to offer a full refund to those customers. FTC's orders to these six companies are not final until the agreements are put in the Federal Register, where they will be posted for a 30-day comment period.

"We appreciate these actions by FTC," said Michael McGuffin, president of AHPA. He added that the agency should not rest on their laurels by stopping with this one investigation into fraudulent supplement companies. "We need the fly-by-nighters not to make it through the first night."

McGuffin stated that FTC's actions were more for the industry's benefit than the consumers' states of mind, adding that these findings are good news for responsible companies that sell products that are legally labeled and marketed. He also said that he had never heard of these six companies before now.

The sites that were investigated are as follows: Panda Herbal (www.viable-herbal.com), ForMor (www.formorintl.com), MaxCell (www.oasiswellness.com), Aaron Company (www.colloidalsilver.net), Jaguar Enterprises (www.ioa.com/~dragonfly/index.html), Western Herb & Dietary Products (www.curecancer.com).

According to James Rohrer, another FTC attorney who worked on Operation Cure.all, one site--Aaron Company--does not exist online anymore. "The site is gone, so I don't think they're in business anymore," Rohrer said. "But that was not part of our goals--to take anyone out of business."

As of press time, two of these sites--Aaron Company and Western Herb & Dietary Products--were down. David Seckman, the executive officer NNFA, stated, "If anyone's not following the FTC guidelines, the government has every right to go after these people."