NAD’s Claims Ruling Holds Lessons Across Industries – Advertising, Marketing and Branding

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This week, NAD announced a decision regarding various claims made by Accredited Debt Relief and its marketing agency. While parts of the decision will likely only be of interest to companies operating in the debt settlement space, the decision also contains important lessons for companies operating outside of this space. We will focus on these in this article.

Claims on expected results

Accredited Debt Relief has announced that its customers can “cut monthly payments in half”. Although the company had evidence that some customers – less than a third – had achieved these results, NAD felt that consumers seeing the claim would assume it was “representative of the typical consumer experience”. As a result, NAD thought consumers might be misled by the claim and recommended the company focus on more typical results.

NAD also noted that there was a “detailed and lengthy” disclosure about the program and its hardware limitations at the bottom of web pages that included the disputed claims. Citing FTC guidelines, NAD wrote that material terms must be “clearly and conspicuously communicated in all four corners of the advertisement in which this claim appears.” Simply putting the information “somewhere” is not enough for people to find it.

One of the “detailed and lengthy” disclosures NAD mentions is around 300 words. Does NAD really expect all of this information to be included in ad copy? Probably not. In its ruling, NAD highlighted certain terms — including typical program length, fees, and certain exclusions — that seemed to be most relevant. Advertisers will have to undertake the difficult task of determining which terms are most important, including those in the body of the ad, and providing the rest in a disclosure.

Claims “up to”

Along the same lines, NAD challenged claims that consumers could reduce “total debt by up to 50 percent.” The evidence you need to back up an “until” claim can largely depend on the context of the claim. While in some cases – like perhaps a “save up to 50% on sweaters during our Black Friday sale” – it may be enough to show that at least 10% of the sweaters are reduced to the 50% level , in other cases, the burden of justification may be heavier.

In the example I made up, consumers can presumably know how much they will save before they make a purchase. In this case, however, NAD noted that consumers won’t know if they’ll be able to get a full 50% debt reduction until they sign up and agree to pay a substantial fee. In the context of “a highly consequential assertion of potential long-term savings”, NAD appears to expect advertisers to use a number that reflects what “all or nearly all individual consumers will save”.

Native advertising

NAD’s decision also focused on a website claiming to offer “reviews of the best debt consolidation companies” based on various objective factors. Accredited Debt Relief comes in first place with a “#1 Top Rated – We Recommend” badge. Consumers who are impressed with this achievement may be a little less impressed if they read the footnote at the bottom of the site which states, among other things, that the site “is owned by the same company that owns Accredited.”

NAD determined that consumers could reasonably expect the website to be independent. “Any disclosure that the website is paid advertising content contradicts the message of independence and impartiality otherwise conveyed by a rating or ranking website. Disclosures may not contradict claims that they qualify as visible, and cannot remedy the misleading idea that the site is independent.”


This is the second case initiated by NAD in the area of ​​debt settlement this year. (You can read our article on the former here.) If you work in this space, you should definitely take a closer look at both decisions as NAD seems to be focused on this area. But don’t ignore these cases just because you work in another industry. As our articles have demonstrated, the decisions include valuable lessons that apply to many industries.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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