The use of the word "botanical" appears to imply that the product is "natural".
When it comes to product claims, there are some instances where guidelines issued by the FDA apply to safety and effectiveness and other instances where the guidelines may be a bit not as strict as long as the products are generally recognized as safe.
In the OTC botanical category are products such as psyllium, senna and witch hazel.
Remember that drugs are defined as products designed to diagnose, treat or prevent disease.
Cosmetics are products used to cleanse, beautify or alter appearance/promote attractiveness. For a product to claim to treat acne, prevent skin cancer (sunblock) or antiaging would qualify it as a drug and require the more stringent process of approval. Moisturizers, cleansers, cosmetics would fall under cosmetics.
For this category, this is not necessarily a dishonest claim. However, it does not really convey anything other than the product is plant derived. As we all know, this can apply to a lot of good things and questionable things. In general, however, the ability for a company to market using this term still requires safety to be demonstrated.