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Comment RSSSecret FTC Diet Agreements Entered
Written by Pace LattinMay 6, 2012 # 8:12 pm # Legal Challenges, Specials # 15 Comments
Performance Marketing Insider has learned that at least a dozen major CPA Networks have entered or are in the process of entering into agreements with the FTC that will prohibit these networks and much of industry from working on many if not most diet offers. These pre-settlement “consent” agreements were reached before the companies were sued by the FTC but were, notified that they were under investigation.
These agreements will keep the networks from being sued and more importantly, from facing possible public legal action and the press releases that often accompany FTC actions.
Most of the agreements are the result of several years of investigation into the marketing of diet offers, many on re-bill that were often promoted via CPA networks using purported deceptive means. The Networks were all contacted last year and informed they were potential targets of investigation – and many of them immediately entered into negotiations with the FTC to prevent potentially damaging lawsuits. Some networks, such as COPEAC fought from the start and were essentially put out of business by the legal bills.
The result of these agreements will basically ban all these networks from working on any diet offers, unless the products are intensely scrutinized and go through double-blind studies that prove its effectiveness. This essentially prevents any new diet pills or products from being marketed via these CPA Networks, unless there is overwhelming proof that they work. This means that any new “fad” products will be almost impossible to promote via affiliate marketing. Even for the networks that have not entered into agreements with the FTC, this is a sure sign that should follow these rules or risk being sued by the FTC.
These requirements are based on guidance already provided from the FTC on dietary supplements.
Written by Pace Lattin
Pace Lattin is one of the top experts in interactive advertising, affiliate marketing. Pace Lattin is known for his dedication to ethics in marketing, and focus on compliance and fraud in the industry, and has written numerous articles for publications from MediaPost, ClickZ, ADOTAS and his own blogs.
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On the one hand, no one wants to see affiliate marketing limited like this.
On the other hand, the diet garbage and the auto rebilling were deceptive practices designed to scam people.
And whether someone agrees or not is irrelevant. If enough people feel scammed and complain to the government, then it is likely that something will be done about it.
I’ve read about the deceptive billing practices and to me that was the real problem.
On the other hand, it played into the FDAs hands of wanting to regulate more and more.
so unfortunately, this played into the hands of the FDA but at the same time, if there had not been deceptive billing practices ( a scam) going on, there may never have been enough complaints for anything to happen.
The networks probably understand that they cannot win and as you mentioned are trying to avoid any trouble.
David recently posted..Getting More Traffic To Your Site Through The Disqus Commenting System
Will the ofshore affiliate networks become the only source of the diet offers in near future?
In my opinion, this will be for the better of a bigger number of people. Affiliate networks can choose another product to market anyway.
Pamela recently posted..cool guitar tab books
@ Pamela
agree with you that can be better of a bigger number of people, allow for affiliates to choose more product within target of market
John recently posted..Stock Investing For Dummies: The 9 Stock Investing Millionaire Principles
It’s all because of the rebills. There are plenty of networks that seel diet pills straight sale (no hidden rebills). Those guys don’t have these types of issues.
It’s the rebill that is making this such a big issue, not the diet pills themselves.
If people pay $50+ for pills and they don’t work, they just won’t buy anymore. If they pay $4.95 and get hit with a $90+ rebill that they can’t easily cancel, then they complain. That’s where the complaints come from in large part, not the product itself.
Well, Sounds like Marketing is now becoming Limited !!
Time to go offshore!
Samrath Gupta recently posted..Top 5 Reasons Why People Don’t Reach Their Goals!
And I think it is because of the rebills lot of network sell a pils,pellets and that stuff.
This is not an attack on marketing,these are simply growing pains and marketing will evolve to deal with the new changes.
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I hope the FTC shuts half these guys down.
I did notice the clickbooth who claimed there was no FTC is now cooperating with the FTC, i hear the FL atorney general is on their ass too, and now the FBI with the destroying evidence claims. and who knows how many others
Copeac gone, azoogle shut down, cx digital gone, eadvertising closed, only a matter of time clickbooth joins the cemetary too
In two years the new crop of “players” like a4d, c2m, adsdirect, mundo, etc… who sucked up all the former employees will face the same fate. Chances are the FTC will smarten up and realize its the AM’s and sales guys who really drive the scam, they all move to a new front and profit, just like affiliates.
I don’t think Clickbooth is going anywhere
I already have clickbooth account but I don’t know the best strategies to make money with CPA network, can any body provide some best strategies to make money with CPA?
Thank you
John recently posted..Stock Investing For Dummies: The 9 Stock Investing Millionaire Principles
cx digital is not gone they are still around
For sure most of money networks make comes from re-bills but this world is huge. i think if diet pills go off some new niche will replace this niche
CPA Marketing Blog KJ recently posted..Using Automated spamming bots to promote CPA Offers
What Scams are you guys talking about?
Why is a rebill a scam?
Buy a cell phone and see how hard it will be to cancel is after 2 months. Get a gym membership paying monthly and try to get away with not paying any more. Hell lease a home for a year and walk away after 2 months. When these people buy the product, they get a SAMPLE for free and just pay for shipping. But 15 days later your next bill will be $60 per month. The advertiser could sell that bottle for $1000 if they like, its the STUPID buyers that don’t pay attention to the terms (aka a contract) when they purchase into the system. ALSO one big problem is customers trying to SCAM these diet offers, by trying to get away with ordering the free trial (trying to get a product for free) then canceling as soon as they get the bottle. Thats the same thing as ATT giving out free phones with a year contract, and going back to the store the next day and canceling the contract so you can keep the free phone. Come on people Rebills are everywhere, some are more shady they others, but why the hell only pick on diet offers? The only people that bitch and complain are the ones that intended on getting a free bottle and had a hard time getting away with it, so they took a shit fit.
This is the write step FTC has taken with this agreement. This step not only beneficial for consumer but also to the marketing companies