New Gold Director
Compliance Training
James Bramble
General Counsel
USANA Health Sciences, Inc.
New Gold Director Training
Copyright USANA Health Sciences, Inc., 2005. All Rights Reserved
Ongoing Supervision and
Training
As an Associate progresses through the
various levels of leadership, his/her
responsibilities to train downline Associates
(product knowledge, effective sales
techniques, the Cellular Compensation Plan,
and the Policies and Procedures, running the
business professionally and ethically)
increases.
Policy 4.1
What is Associate
Compliance?
The means by which USANA protects its
interests and the interests of its
independent sales representatives from
the adverse consequences of
inappropriate sales and business activities.
In other words . . . The way a
distributorship is protected to be around
for the long term.
What are USANA’s interests? Associates?
Two Levels of Protection
 To protect USANA and
its Associates from
regulatory
enforcement activities.
 To protect USANA and
its Associates from the
inappropriate sales
and business activities
of other Associates.
Regulators: Who are They?
 FDA, HPB, TGA, New
Zealand Ministry of
Health, Etc.
 FTC, Industry Canada,
ACCC, NZCC, etc.
 Attorneys General and
State and Provincial
Agencies,
 Securities Regulators,
 Consumer Protection
Watchdogs.
Regulators:
Why Should We Care?
Through compliance with
applicable regulations USANA
protects its interests and the
interests of its Associate sales
force from the adverse
consequences associated with
violations.
Legal and Policy
Guidelines
Improper Product
Claims
Improper Business
Claims, (Income
Claims,
Misrepresentations
and Deceptive
Practices.)
Product Claims
Policy 3.4.1
Dietary Supplement Health and Education Act
No therapeutic or cure claims except as
provided in literature.
No “drug claims” - cure, treat, diagnose,
prevent or mitigate the symptoms.
Claims about health, well being and how a
product affects the structure and function of
the body are OK.
Examples
PROPER
IMPROPER
 “I can run and play ball
with my children again.”
 “I feel 20 years younger.”
 “I feel healthier.”
 I am supporting a healthy
cardiovascular system.
 “I no longer have the
pain and stiffness
associated with my
arthritis.”
 “I no longer have
migraine headaches.”
 “I have reduced the risk
of having a heart attack
by lowering my
cholesterol level 20
points.”
Business Claims
Business Claims
No income claims - Policy 3.4.2
No deceptive practices - Policy 3.8 (no
guarantees, $ based on sales,
representation that business plan is
“approved” by regulatory agency, etc.)
Retail Sales - Pyramid Law
Commissions earned
must be based on
sales. Customer
Development is
essential.
Preferred Customer
Program.
Return Policies
Phantom Activities
Investment Contracts
Sometimes securities regulators try to
make and MLM opportunity into an
unregistered security.
Don’t use the term “investment”
Don’t make promises to build another’s
business or say “You don’t have to do
anything.”
Do train and help your downline.
Examples
Proper
Improper
 “Through my efforts I no
longer live paycheck to
paycheck and I am living
the life of my dreams.”
 “Let me walk you through
the compensation plan
and show you exactly how
much money you can
earn.”
 “I am already beginning to
see the residual nature of
my initial efforts.”
 “I made my first $1000
check after only 3 weeks.”
 “Think of it as an
investment, you give me
the money and sit back
and watch as I build your
business and you make
money.”
 “The USANA compensation
plan has been endorsed
by the FTC.”
Inappropriate Sales and
Business Activities
Compliance protects Associates
from:
Cross-line raiding
Improper recruiting
Improper transfers
Sales from retail outlets
Inappropriate Sales and
Business Activities cont...
Compliance protects USANA from:
Downline raiding
Disclosure of “trade secrets” (I.e. DLM
reports)
Trademark / copyright infringement
Unauthorized agreements
Inappropriate Sales and
Business Activities cont...
Compliance protects USANA from:
Civil liability
Maintaining independent contractor status
interfering with contractual relationships (i.e.
tortious interference with a business relationship.)
Product liability
Vendor’s endorsement.
Specific Guidelines
Policies and
Procedures
We review and stay
up to date on the
laws in all countries
where USANA does
business. The
policies allow your
business to be
“seamless.”
Legal Services
Department
 General Counsel - James Bramble (Spanish, English)
 Assistant General Counsel – Kevin McMurray (Spanish,
English)
 Legal Cousnel – Chen Shen (Mandarin, Cantonese,
English)
 Compliance Officer - Dan Whitney (Mandarin,
Cantonese, English)
 Compliance Assistants - Aimie Buxton (Spanish English),
Dave Park (Spanish, English) and Shiree Tholen(English)
 Legal/Admin Assistant – Therese Vengo (French,
English)
QUIZ
True or False?
If an Associate is dissatisfied with her
current downline placement, she can
cancel her distributorship and re-enroll
immediately in another downline
organization.
FALSE
An Associate who voluntarily cancels her
Distributorship may reapply for a new
Distributorship after six (6) full calendar months.
See USANA Policy Section 3.
True or False?
I can enroll a current Associate in my
organization by using an assumed name,
a family name or a business name.
False
 It is improper for Associates to solicit another Associate
or Preferred Customer to enroll as an Associate or
Preferred Customer in another line of sponsorship; and
Associates may not use assumed names or business
names to circumvent this rule. Moreover, an Associate
may not own or operate more than one Distributorship.
See Policy Section 3.
True or False?
As a Gold Director, I can approve
advertising materials for myself and my
downline organization.
False
Only USANA can review and approve
advertising materials. Associates
below the rank of Gold Director may
not create advertising materials to
promote their USANA businesses. See
Policy Section 3.
True or False?
I am required to make retail sales in order
to qualify for commissions bonuses and
advancement to higher levels of
achievement.
True
The USANA Compensation Plan is
based on the sale of USANA products
to end consumers. Associates must
fulfill specified personal and Downline
organization sales requirements. See
Section 5 Policies and Procedures.
Question
How many customers must Associates
develop or service every four weeks?
Associates must develop or service at least
five (5) customers every four-week rolling
period. These customers can be either Retail
Customers or Preferred Customers, or any
combination of the two. See Policies and
Procedures Section 5.
Question
What is the difference between a
legitimate multi-level marketing company
and an illegal pyramid scheme?
In a legitimate Multilevel Marketing Plan
participants sell goods or services to end
users in order to qualify for commissions. A
pyramid scheme is a plan where individuals
pay money for the opportunity to receive
compensation solely or substantially for
recruiting other participants.
True or False
I can freely copy publications or
information from the corporate website
for republication and sale to other USANA
Associates or prospects.
False
It is an infringement of USANA’s
copyright in these materials for any
Distributor to copy this information for
commercial gain.
True or False
I can complete an application and sign
her name for my friend who wants to
enroll as an Associate.
False
The Applicant must sign her own
application. Signing an applicant’s
name may create an unenforceable
agreement.
Questions and Answers
My phone number 801-954-7805
Compliance Assistants – 801-954-7100
e-mail compliance@usana.com
fax 801-954-7809