Comment Number: 522418-03793
Received: 6/22/2006 3:34:22 AM
Organization:
Commenter: Dickman
State: KS
Subject: Business Opportunity Rule
Title: Notice of Proposed Rulemaking
CFR Citation: 16 CFR Part 437
No Attachments

Comments:

Dear FTC Commissioners: I was very disheartened to learn about your proposed ruling called the Business Opportunity Rule, R511993. I appreciate the FTC wanting to do something about fraudulent people using the direct sales model, but this rule unfairly targets legitimate companies. I will highlight some areas that I find particularly obtrusive to my business. The seven-day waiting period called for in this ruling would be particularly devastating in several ways. My experience with direct sales has mostly been with nutritional supplement companies. If I thought I had found a product that I thought I wanted to use to improve my poor health, I certainly wouldn't want to wait 7 days to sign up, and then another 7-10 days to get my product. I could really be hurting by that time! On the business side, if I have found someone who is greatly in need of my products, the seven day waiting period delays their return to better health. It also puts my business in a bad light, as if it's a "shady" business that they need to take time to reflect on first. It would be an administrative nightmare to try to get in contact with these same people when my calendar says seven days have gone by. It is just very impractical and delays everything unnecessarily. Another part of the ruling that requires a list of 10 geographically nearest purchasers, including their names, addresses, and telephone numbers could be an impossible request when you consider the privacy issues. Who would want to buy from a direct sales company when they thought their private phone numbers and addresses would be open to the public to use and abuse? That's just for openers. I can see this being a very litigious subject. Secondly, if I have gone to the work of educating a person about my products and company's business plan and then they get this list and see their best friend is also in the company, they will more than likely sign up with their friend. This means I just wasted my time and money with nothing to show for it. I really don't see how this would stop fraudulent people. It would be easier for them to operate by giving fictitious names, but would be a nightmare for a legitimate company to follow. Also, how would you ever be able to start a new business--before you had 10 purchasers?? I see this requirement as being overburdensome and not really stopping fraud anyway. The requirement in your ruling to disclose the number of purchasers of the business opportunity, and then the number of cancellation requests in a two year period can be very misleading. A company like mine that emphasizes that all their independent members liberally grant requests for refunds, would be unfairly punished by this ruling. I know the FTC is trying to stop fraud, but by punishing the 13.6 million individuals involved in legitimate home businesses with these proposed rulings, you may ruin a legitimate industry and still not stop the fraudulent businesses. Please work with the Direct Sales Association to work out better solutions. Thank you in advance for listening. Mrs. Dickman, Kansas