UK-based Nutrizen Wellness was found guilty of using illegal telemarketing techniques as well as stating false and misleading claims, among other things in the sale of its health supplements.
The firm, based in Kenilworth, Warwickshire, was ordered to wind up in the public interest on 31 October 2019 in the High Court of Justice in Manchester before District Judge Richmond.
“Nutrizen Wellness deliberately and unconscionably targeted the elderly, pushing their products at astronomical levels of mark-up,” said Scott Crighton, the Insolvency Service’s chief investigator.
“They also underreported the true level of their income to HMRC, failing to pay the appropriate levels of VAT.
“We are pleased the courts recognise this behaviour is totally unacceptable and have shut down their activities to prevent anyone else falling victim to their practices.”
€800+ spent in 19 days
The Court heard details of Nutrizen Wellness’ unscrupulous tactics designed to secure sales from customers that included an 88-year old, who spent over €803 (£700) on supplements in just 19 days.
The discovery breached an agreement with Trading Standards by the firm to limit sales to €344 (£300) in a single transaction, with investigators highlighting two purchases that exceeded this amount.
The Insolvency Service also revealed the firm bought consumer data identifying individuals aged 65 and over. Agents representing Nutrizen Wellness then began cold-calling them from third-party call centres located in Goa, India.
Health supplements were then sold to these individuals at vastly inflated prices. One product, available on the high street for €2.30 (£2), was sold by Nutrizen for around €34 - €46 (£30–£40).
Investigators also provided a detailed breakdown of Nutrizen Wellness’s VAT affairs, providing evidence that turnover was €289,000 (£250,000) higher than the amount declared to the UK’s Revenue and Customs.
Furthermore, Nutrizen Wellness had transferred 80% of its sales revenues out of the country to the India-based call centres.
Insolvency Service investigations
The case is similar to previous investigations that found similar firms preying on the elderly and vulnerable with their food supplement products.
NutraIngredients previously reported on an investigation by the Service back in September 2018, in which Vivid Lifestyle Ltd (Vivid), also UK-based, misled customers as to the worth and likely effects of tablets sold at huge mark ups.
Vivid, based in Hounslow, West London, were guilty of using highly pressurised and persistent sales practices and techniques, including medically unqualified telesales callers making false claims.
In January 2017, Souza Healthcare, a London-based company were instructed by the UK High Court to cease trading after they too sold ‘useless’ health supplements to elderly people.
Elbon Wellbeing Ltd, another UK-based company, were ordered to cease trading after they made false and misleading claims that led elderly and vulnerable customers to purchase the firm’s health supplements.