Are Celebrity Endorsements Effective?

Aug. 1, 2002 -- Have you been taken in by celebrity endorsements because you trust what your favorite stars have to say?If so, you might want to take a hint from the Federal Trade Commission before you put down your credit card.

The following is an uncorrected, unedited transcript from ABCNEWS' Good Morning America.

ABCNEWS' TERRY MORAN:

But we'll begin right now with those celebrity endorsements. Ifyou've ever been convinced to buy something on TV because one of yourfavorite celebrities was selling it, take note. Baseball great SteveGarvey, once a pitch man for an herbal diet supplement, is in the hotseat now as the government tries to hold him responsible for theclaims he was paid to make. Consumer correspondent HUNTER: has the story.

But we'll begin right now with those celebrity endorsements. Ifyou've ever been convinced to buy something on TV because one of yourfavorite celebrities was selling it, take note. Baseball great SteveGarvey, once a pitch man for an herbal diet supplement, is in the hotseat now as the government tries to hold him responsible for theclaims he was paid to make. Consumer correspondent HUNTER: has the story. (Clip from Infomercial shown) GARVEY:Within Enforma, you can eat what you want and never, ever, ever, everhave to diet again. (End of clip) HUNTER:(VO) Infomercials for a diet product called the Enforma System hasbeen off the air since 2000, but now, they're exhibit A in the caseagainst the celebrity who started them. The pitch man was one ofbaseball's all-time greats, former LA Dodger

GARVEY:, a 10-timeall-star who may be destined to the Hall of Fame. (Clip from baseball game shown) HUNTER:(VO) Enforma paid Garvey's management company over $1 million. Afterall, who has more fitness credibility than a professional athletewith 20 years in the major leagues? (Clip from Infomercial) GARVEY:You know, Kendall, I've been an athlete all my life and I've alwayshad to watch what I eat. HUNTER:(VO) The infomercial served up images of shapely people feasting onplatters of fatty food. GARVEY:If you want to be able to enjoy all those delicious foods that youcrave without the guilt while losing weight and keeping it off, callus now. (End of clip)

DENISE RUNDLEThat's what I did. HUNTER:(VO) Denise Rundle, from the San Francisco area, was one of a millionand a half people who ordered the $79 Enforma System, including FatTrapper and Exercise in a Bottle.

DENISE RUNDLEI thought I was going to trap the fat.

HUNTER:Did it work?

DENISE RUNDLENo, it didn't. Not at all. Not at all.

HUNTER:(VO) Still, Enforma grossed at least $100 million. But beforeexecutives could count the cash, consumer alarms began ringing. Eventhe infomercial industry's own trade group complained.

ELISSA MYERS, ELECTRONIC RETAILING ASSOCIATIONThis kind of deception of the American public has no place inAmerican business. HUNTER:(VO) Prompted by that complaint, the Federal Trade Commission chargedEnforma's claims were not supported and it sued, alleging deceptiveand misleading advertising. Enforma's CEO says he now has evidencethat diet pills work but admits some of the infomercial claims wereshaky.

(OC) Your infomercial is kind of a lie, isn't it?

DREW GREY, CEO ENFORMAThe infomercial is — is kind of history. We're talking aboutsomething from 1998. HUNTER:A history of lies. DREW GREY

I wouldn't call them lies. HUNTER:OK.

DREW GREYI would call them — some of the claims didn't have adequate support … HUNTER:OK. DREW GREY … for them. HUNTER:(VO) Enforma settled the lawsuit, shelling out $10 million withoutadmitting wrongdoing. But the government was just warming up. Nowit's going after the legendary GARVEY: (OC) You were sued for deceptive acts and false advertising.Steve, say it ain't so. GARVEY: (HOSTED INFOMERCIAL)Well, I'm telling you that at the time I did all my due diligence onthese products. The product worked for me, my wife and my family. HUNTER:(VO) Garvey says Enforma showed him one study and he saw similar dietproducts in stores. Not good enough, according to the government.

ELAINE KOLISH, FEDERAL TRADE COMMISSIONNow, we're not asking celebrities to go out there, hire their ownexperts, do their own testing, but we're asking them to make certainthat there is testing and to make certain there aren't any obvious oron-the-surface flaws with the testing. HUNTER:(VO) Just listen to what Garvey said. (Clip from Infomercial) GARVEY:You can enjoy all these delicious foods like fried chicken, pizza,cheeseburgers, even butter and sour cream, and stop worrying aboutthe weight. (End of clip) HUNTER:Steve, did you believe that? GARVEY:Well, I think that — again, I didn't write the script, number one. Butnumber two, you can enjoy those things if you eat responsibly. HUNTER:You advocate you have to diet and exercise to lose weight, right? GARVEY:Right. HUNTER:Why didn't you say it in your commercial? GARVEY:Oh, I did it in QVC. HUNTER:You didn't in the commercial. GARVEY:Well, they — they were supposed to put this on the — on the air in someform or shape. I am not — I am just the host in there. HUNTER:(VO) Garvey says he thought there would be disclaimers clearlystating diet and exercise were necessary. Enforma denies agreeing tothat and there were no such disclaimers.

Maybe there should have been a disclaimer about Garvey'sco-host, too. She was introduced as a a nutritionist, but she doesn'thave a college degree. The company says she has taken some classes innutrition.

(OC) Do you think celebrities should get a pass? GARVEY:No. HUNTER:If they're involved with a product that doesn't work … GARVEY:Absolutely not. I tried … HUNTER: … that has no basis in science of working? GARVEY:An individual who's done all of his or her due diligence and getscaught up in this and then then is used as an example, a sacrificiallamb, I think thing's have gone too far. HUNTER:Have you lost faith in this company? GARVEY:Of course I have. HUNTER:Why? GARVEY:I mean, any relationship is — is based on honest — honesty and truthand they obviously lied to me. I'm the guy twisting in the wind rightnow.

MORAN:And consumer correspondent HUNTER: joins us now. Greg, exercisein a bottle? HUNTER:And fat trapper. MORAN:And fat trapper. Now, these infomercials went off the air, theinfomercials went off the air. What's the status of this supplement? HUNTER:You can still buy this in the stores. We bought this at a majorretailer, and if you look on the front of the package now, on thelower right-hand corner on your screen, it says "dietary supplement.Diet — died and exercise is required to lose weight." That's thedisclaimer on the package. Go figure. The government says that's notgood enough. "Diet and exercise is required to lose weight," notgood enough. They're trying to stop the sale of these products andbig name stores — I was surprised to find out big name stores arestill selling it. MORAN:You're usually telling us stories about consumers to be aware ofthese things. How about celebrities? Is this going to set a precedentfor celebrity endorsements, do you think? HUNTER:According to the ERA, this will set a precedent. It's going to havea chilling effect for any celebrity that goes out and makes a pitchto a product and doesn't know whether or not the product islegitimate or not.