FTC extracts hefty settlement for false claims

The case against Iworx, Selfworx.com and company president Jeffrey Kral over claims made about Ultra LipoLean and Gel Thin, was one of six filed by the FTC in November 2004 when it launched Operation Big Fat Lie, an enforcement sweep targeting bogus weight loss claims in advertising.

The original complaint was later amended to include two more defendants: Bernard Willimann, an owner and active participant in the operation and relief defendant Shawn Lyden.

In advertisements which appeared in national publications such as Cosmopolitan, Complete Woman and Sunday newspaper supplements, the defendants claimed that the Ultra LipoLean dietary supplement caused rapid weight loss of as much as four pounds a week without the need to diet, and that two tablets could absorb 20 to 30 grams of fat from a meal.

A second product, known as Gel Thin, was claimed to cause substantial weight loss by dissolving fat deposits and removing cellulite within days of being rubbed into the skin. The FTC also alleged that the defendants falsely asserted that these claims were backed up by clinical trials.

In addition to the $100,000 in consumer redress, the defendants are barred from making false and unsubstantiated claims for their products in the future, and misrepresenting the existence, validity and results of any studies. The settlement also includes record keeping requirements through which the FTC will be able to monitor compliance.

The FTC said that one or more of the claims made by the defendants in the advertising were 'red flag' claims - seven assertions that should make the broadcast and print media wary of an advertised product's efficacy. These are:

That users could lose more than two pounds per week (over four or more weeks) without cutting back on calories and/or stepping up physical activity; that users could lose substantial weight while eating unlimited amounts of high calorie foods; that weight loss is permanent, even once the user has stopped using the product; that the product causes substantial weight loss by blocking fat or calorie absorption; that users could safely lose more than three pounds per week without conveying the need for medical supervision; that users could lose substantial weight through a product worn on the body or rubbed into the skin; that the product causes substantial weight loss for all users.

The Red Flag initiative was launched in February 2003. In April this year a survey carried out by the FTC said that the number of obviously false weight-loss claims for dietary supplements, creams and patches fell from 50 percent in 2001 to just 15 percent in 2004.