Compliance Training Materials Summary

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Spencer McCoy
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1 Compliance Training Materials Summary Dear PURE IBO, We are pleased to provide you with the enclosed training materials to help you understand how to appropriately share the products and opportunity offered by PURE: People United Reaching Everyone. The laws and regulations that govern health claims and income claims are designed to protect consumers against unfair, fraudulent, deceptive or misleading claims. As you read and study the enclosed training materials, should you have any questions or concerns, please contact our Compliance Department at The enclosed training material covers the following topics: I. An overview of the regulatory framework governing claims regarding dietary supplements, cosmetics and income opportunities (the FDA and the FTC). - Prohibitions on claims that any dietary supplement diagnoses, prevents, treats or cures any disease. II. Regulatory guidance on weight loss claims. III. Weight Loss Claims Do s and Don ts. IV. Do s and Don ts when sharing Product Testimonials. V. Do s and Don ts when sharing Income Opportunities. VI. A List of tools to help you. VII. A sample of the Income Disclosure Statement that is to be used each time you discuss the PURE Prosperity Compensation Plan and potential Income Opportunities. We wish you the best of health and success. Live Pure, The PURE Management Team

2 How to Comply With the Law While Sharing PURE *For use in the U.S. only The purpose of this Compliance Training Document is to help provide you with the knowledge and tools necessary to share your success and the benefits of our products and opportunity in a compliant manner. We are here to help protect you and the Company, and encourage you to do your part by complying with the information presented in this training and our IBO Policies & Procedures. Together, we can help ensure others are also able to share in the benefits of PURE. I. Regulation The Food and Drug Administration (FDA) and Federal Trade Commission (FTC) have a longstanding agreement and work closely together to regulate what is said about dietary supplements. The FTC also regulates what is said regarding income opportunities. Part of the FDA s role is to protect public health by assuring cosmetics and dietary supplements are safe and properly labeled. o The FDA regulates dietary supplement ingredients and finished products, including claims on product labels, packaging and package inserts, accompanying literature, store displays, etc. Part of the FTC s role is to protect consumers from unfair, deceptive or fraudulent advertising practices in the marketplace. o The FTC regulates claims in advertising including TV and radio commercials, infomercials, broadcast ads, print and direct mail ads, coupons inserts and Internet advertising. o When you are discussing the products and/or income opportunity with prospective product consumers and/or Independent Business Owners, you are engaged in commercial speech. It is important to understand that commercial speech is not afforded the same protection under the First Amendment and the FTC may regulate commercial speech that is found to be deceptive, including product testimonials, endorsements and income/earnings claims. The Dietary Supplement Health and Education Act (DSHEA) of 1994 established new framework for the regulation of dietary supplements. DSHEA defines dietary supplements as a category of foods, not drugs. Only drugs can make claims to diagnose, prevent, treat or cure any disease. The FDA must approve all new drugs that are produced and marketed to prevent, treat, cure or mitigate disease. Introducing unapproved drugs into commerce is strictly prohibited by the FDA. Any claims that a dietary supplement is intended to prevent, treat, cure or mitigate a disease or medical condition can cause the supplement to be viewed as an unapproved new drug by regulators. o You should never go beyond or stray from the Company s approved product claims 2 P a g e

3 because in doing so you are creating new claims that the Company must be able to defend and substantiate. We must ensure all claims are truthful, substantiated and not misleading. II. FTC Guidance on Weight Loss Claims The FTC has created a guidance document which clarifies the types of weight loss claims that should be viewed as questionable by advertisers and consumers alike. We feel this document is a valuable education tool in identifying unacceptable and false weight loss claims. The following claims have been identified as gut check claims in the FTC s publication, Gut Check: A Reference Guide for Media on Spotting False Weight Loss Claims¹: 1. causes weight loss of two pounds or more a week for a month or more without dieting or exercise ; 2. causes substantial weight loss no matter what or how much the consumer eats ; 3. causes permanent weight loss even after the consumer stops using product ; 4. blocks the absorption of fat or calories to enable consumers to lose substantial weight ; 5. safely enables consumers to lose more than three pounds per week for more than four weeks ; 6. causes substantial weight loss for all users ; or 7. causes substantial weight loss by wearing a product on the body or rubbing it into the skin. Reference: ¹ Gut Check: A Reference Guide for Media on Spotting False Weight Loss Claims, January III. Weight Loss Claims Do s & Don ts Weight loss claims and testimonials must be supported by adequate substantiation that the claim or testimonial represents what consumers in general will achieve; you must clearly and conspicuously disclose the typical results. Making claims that are deceptive, untrue, misleading or too good to be true is not permitted. When discussing weight loss results, you should always explain that results are achieved when the products are combined with a healthy diet and regular exercise. It s important to talk about a healthy lifestyle. When sharing weight loss results in any format (on websites, videos, photos, print, audio, etc.) the following disclaimer should be used: *Weight loss results may vary based on individual users. Products offered by PURE are designed to be used in conjunction with a healthy diet and regular exercise. Individuals metabolisms and lifestyles vary, as does the manner in which they will respond to any particular product. What works for one individual may not work for another. For example, don t say: you re guaranteed to lose weight I did, this worked for me it ll work for you, etc. Only make product claims that are on product labels or in Company created promotional materials. 3 P a g e

4 Don t use the term proven unless it is listed in the approved product claims. There must be well controlled clinical studies to support this type of claim. The presence of disclaimers does not alleviate or correct claims that are unapproved, deceptive, untrue, misleading or too good to be true. Disclaimers must be clearly legible, conspicuous, linked to the statement/claim with a symbol (e.g., an asterisk), and placed adjacent to the statement/claim. Never refer to our products as miracle or magic pills, juices, etc. Never make false statements that imply the products alone will assist in weight loss without proper diet and regular exercise. For example, don t say: melts your fat away, quick and easy weight loss without diet and exercise, eat anything you want and still lose weight, this product works for everyone, rapid weight loss, lose weight by doing nothing, lifelong weight loss, etc. Persons interested in using the products or programs offered by PURE to maintain healthy weight should consult with their health care provider prior to beginning any new nutritional and exercise program. IV. Product Testimonials Do s & Don ts Products offered by PURE are designed to support and maintain health and general wellbeing. Our products are not intended to diagnose, cure, treat, prevent or mitigate any disease or ailment and are not intended to replace any medical treatment or physician s care. Never advise anyone to go against their doctor s orders and never recommend the products as a prevention, treatment or cure for any disease, ailment or medical condition. Product safety questions for individuals that are on medications, pregnant or nursing, have health concerns, or diseases, should be directed to their healthcare provider. In these cases, our products may not be appropriate for all individuals and only a qualified healthcare provider should make recommendations on which products are safe to use. Only make product claims that are on product labels or in Company created promotional materials. Claims that directly or indirectly suggest the products can be used to cure, treat, prevent or mitigate any disease or ailment are strictly prohibited. Approved products claims are posted on the Company website and in the Virtual Back Office (VBO). The FDA disclaimer should be used anytime product claims are being made, except with regard to the skincare product line. When sharing product testimonials in any format (on websites, videos, photos, print, audio, etc.) the following disclaimer should be used: *These statements have not been evaluated by the Food and Drug Administration. Products offered by PURE are not intended to diagnose, cure, treat, or prevent any disease and are not intended to replace any medical treatment. When sharing skincare results in any format (on websites, videos, photos, print, audio, etc.) the following disclaimer should be used: *These results are not intended to demonstrate all possible outcomes and cannot predict the specific results you may achieve when using skincare products offered by PURE. Actual results and timing may vary. Product claims and testimonials must be supported by adequate substantiation that the claim or testimonial represents what consumers in general will achieve; you must clearly 4 P a g e

5 and conspicuously disclose the typical results. Making claims that are deceptive, untrue, misleading or too good to be true is not permitted. The presence of a disclaimer does not alleviate or correct claims that are unapproved, deceptive, untrue, misleading or too good to be true. Disclaimers must be clearly legible, conspicuous, linked to the statement/claim with a symbol (e.g., an asterisk), and placed adjacent to the statement/claim. V. Income/Earnings Claims Do s & Don ts The Income Disclosure Statement (IDS) should be presented anytime the compensation plan is presented or discussed, or any type of income claim or earnings representation is made. The IDS is posted on the Company s website and in the VBO. Income/Earnings claims must always be accompanied with the appropriate disclaimer. *These results are not necessarily typical or average, nor do they represent a guarantee of your personal results. All earnings are based on the sale of products and depend largely on your efforts, abilities, and the market available to you. For detailed information on IBO income averages, please visit In addition to verbal representations, earnings claims also include any chart, table, or calculation that demonstrates possible results and must always be presented with the proper disclaimers. Lifestyle claims that discuss or include images of luxury cars, large homes, exotic vacations or other amenities that imply wealth are also considered income claims and must be presented with the proper disclaimers. You must always identify yourself as an Independent Business Owner (IBO). IBOs may not represent themselves as employees, affiliates, partners, agents, principals or franchisees of PURE. For websites and printed materials, you may use the IBO logo that is posted in the VBO, but you cannot use the corporate PURE logo. IBOs must be forthcoming with the purpose of their presentations and product information with customers and should immediately discontinue any demonstrations or sales presentations upon the request of the customer. Personal or telephone contacts should be made in a reasonable manner and during reasonable hours to avoid intrusiveness and in accordance with applicable laws. Always be clear that the individual can become an IBO or customer, or both. Be sure to provide a sufficient explanation of the compensation plan and the obligations and responsibilities of being an IBO. You must provide adequate information for individuals to make an informed decision. Avoid abbreviating or over simplifying presentations or compensation plan material. You should always be honest and forthcoming about the amount of work and effort required to be successful and to achieve the results being presented. Never present any result or income as being easy and quick to achieve. The opportunities for income under the PURE Prosperity compensation plan are determined by many factors, including, but not limited to, the ability and dedication of the individual. You may only discuss another IBO s income if it is published in an official Company created 5 P a g e

6 VI. document containing the IDS. Certain states have laws and regulations that regulate or prohibit earning claims. You may not use the IDS, make any earnings or income representations, or present any materials that contain earning and income representations in Georgia, Louisiana, Maryland, Massachusetts, Puerto Rico or Wyoming. Income/Earnings Claims must be supported by adequate substantiation that the claim represents what IBOs in general will achieve; you must clearly and conspicuously disclose the typical results. Making false statements, exaggerations or misrepresentations about your income or earnings is prohibited. The presence of disclaimers does not alleviate or correct claims that are unapproved, deceptive, untrue, misleading or too good to be true. Disclaimers must be clearly legible, conspicuous, linked to the statement/claim with a symbol (e.g., an asterisk), and placed adjacent to the statement/claim. Don t present the products or opportunity offered by PURE as a financial investment. PURE is not a security and should not be presented as such. The income opportunity should not be presented as a business opportunity. There are various federal and state laws that govern business opportunities. PURE is structured to offer an income opportunity through the sale of products. Always be clear that Autoship is optional and is offered for convenience, allowing IBOs and their customers to select the products they sell or consume most frequently to be shipped to them automatically every 28 days. It should not be promoted as a means to remain active or commission qualified. Always be clear that the personal volume (PV) requirement to remain active can come from either personal product purchases or product sales to Retail and Preferred Customers, or any combination thereof, every 28 days. Commissions are paid solely on the sale of product. Commissions are not paid for recruiting other members. Tools to Help You IBO Policies and Procedures available in your VBO under U.S. Forms/Documents in the Library. Approved Product Claims & Disclaimers available in your VBO under Product Education, and published on the Company s website. Income Disclosure Statement - available in your VBO under U.S. Forms/Documents in the Library, and published on the Company s website. Compliance Training Document available in your VBO under U.S. Forms/Documents in the Library. The Compliance Department available via compliance@livepure.com. Thank you for taking the time to review this Compliance Training Document. We ask that you hold yourself and others accountable to these standards and encourage you to report any violations directly to the Company by ing compliance@livepure.com. 6 P a g e

7 VII. Sample Income Disclosure Statement U.S. Income Disclosure Statement for 2014 Rank Category Genesis Director Executive Diamond Boardroom Active Distributor Rank Number of Distributors at this Rank Percent of Active Distributors Percent of All Distributors* 2014 Weekly Income for Active Distributors (US Dollars) Months Active with Genesis PURE High Low Average High Low Average Star % 0.239% $ $30.00 $ Star 300 2, % 1.411% $2, $30.00 $ Star 900 2, % 1.527% $3, $30.00 $ Silver Director 1, % 0.866% $2, $31.87 $ Gold Director % 0.323% $2, $96.10 $ Platinum Director % 0.149% $3, $ $1, Sapphire Executive % 0.054% $4, $ $1, Ruby Executive % 0.087% $6, $1, $2, Emerald Executive % 0.025% $8, $1, $2, Diamond % 0.034% $10, $2, $3, Blue Diamond % 0.034% $22, $2, $7, Presidential % 0.006% $21, $6, $12, Chairman % 0.006% $41, $10, $24, Ambassador % 0.003% $51, $20, $27, Crown Diamond % 0.001% $58, $31, $39, Total 7, % 4.763% * Based on 154,355 as of End of Year 2014 The income statistics represented in this document are for all active U.S. Genesis PURE distributors who were eligible to earn downline commissions in An active distributor is defined as a Genesis PURE distributor who was paid a commission during the period from January 1, 2014 to December 31, Distributors who were inactive in 2014 received no income. The average annual income for all U.S. active distributors in 2014 was $3,593, and the median annual income for all U.S. active Distributors in 2014 was $297. Out of approximately 9,715 active U.S. distributors that earned a commission in 2014, approximately 8,960 were still active at the end of the year. Note that these figures do not represent a distributor's profit, as they do not consider expenses incurred by a distributor in operation or promotion of his/her business. The figures above refer to gross income (total income before any expenses are deducted). The expenses a distributor incurs in the operation of his or her Genesis PURE business vary widely. Expenses for distributors can be several thousand dollars annually. You should factor in estimated expenses when projecting potential profits. Such operating expenses could include advertising and promotional expenses, product samples, training, travel, telephone and Internet costs, and miscellaneous expenses. Months with Earnings Number of Active Distributors 1,828 1, Percentage of Active Distributors 24.9% 16.5% 11.4% 7.9% 5.4% 5.2% 4.1% 3.9% 3.2% 2.7% 3.4% 11.5% The figures within this document are not guarantees or projections of your actual earnings or profits. Genesis PURE makes no guarantee of financial success. Success with Genesis PURE results only from successful sales efforts, which require hard work, diligence, skill, persistence, competence, and leadership. Your success will depend upon how well you exercise these qualities. Genesis PURE and the logo design are trademarks of Genesis PURE, Incorporated. All rights reserved Technology Drive, Suite 100 Frisco, Texas 75033

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