FTC sends $470k in refunds to consumers defrauded by aloe vera supplement marketer
The Federal Trade Commission continues to be vigilant in policing health-related claims, after announcing over 22,580 refund checks would be mailed this week to consumers nationwide.
The checks, totaling more than $470,000, are on their way to consumers who bought TrueAloe and AloeCran supplements from a company called NatureCity, LLC. The agency said consumers were defrauded by misleading health claims that were not backed by scientific evidence.
Targeting seniors
According to the FTC’s October 2019 complaint, the Florida-based company made claims that TrueAloe and AloeCran were effective treatments for a range of conditions affecting seniors in particular, including chronic pain, ulcerative colitis, diabetes, and acid reflux.
“Our settlement with NatureCity is the latest example, and we’re especially concerned that the company targeted older adults and tried to steer them away from standard medical treatments,” said Andrew Smith, director of the FTC’s Bureau of Consumer Protection.
Since 2002, the company advertised, marketed and sold a variety of health-related products including TrueAloe edible capsules and AloeCran drink mix.
NatureCity’s advertisements described a number of clinical studies and data that they used to back their products. However, the FTC alleges the company never conducted a single study to support its health claims.
The owners of NatureCity, Carl Pradelli and Beth Pradelli, are named as defendants in the case. According to their company website, they take science seriously: “As supplement shoppers, Beth and Carl Pradelli know the difficulty of trying to make sure that you’re getting the most bang for your buck with the supplements that you buy. When they decided to found NatureCity, they did so with a pledge to focus only on scientifically backed branded ingredients.”
Non-compliance with endorsement and testimonial guide
In addition to the so-called ‘clinical studies,’ the company’s marketing materials featured testimonials of satisfied customers. However, NatureCity did not disclose that the reviewers received free products or free lifetime memberships as compensation for providing the review.
The company violated the FTC’s endorsement and testimonial guide by not mentioning the reviewers received compensation. This is an issue that is becoming increasingly common with online influencers on Instagram.
Under the final order, the defendants must clearly and conspicuously disclose to consumers that NatureCity was sued for deceptive advertising and that it gave some customers free products and shipping in exchange for positive reviews and testimonials for TrueAloe and AloeCran.
NatureCity takes heat
The order also imposes an $18.7 million judgment against the defendants, which will be partially suspended after they pay the Commission $537,500.
The $537,500 is being used to provide refunds to defrauded consumers. Given this week’s refund checks total about $470,000, it appears another round of refund checks will be mailed out in the future.
FTC advises consumers who receive a refund check to cash or deposit it within 60 days. The average amount of each check is $20.83.
“The FTC has shown over and over that it will go after companies that we believe are peddling false health claims about their pills and potions,” stated Smith.
