| Comment Number: | 522418-04312 |
| Received: | 6/26/2006 2:02:19 PM |
| Organization: | |
| Commenter: | Giblin |
| State: | NJ |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| No Attachments |
Comments:
Passing such a bill would have very negative consequences on my 36 year old business. I earn a few hundred dollars each month which supplements my social security. My experience is that most people entertaining a decision to enter any business ask all the wrong people to help them with their decision. Instead of asking those with successful histories, they consult with a neighbor, friend, relative, etc. who have little or no knowledge of the business workings. My solution would be as follows: Problem 1: Prospects would have to wait 7 days after receiving disclosures before they could register. Solution: Eliminate the waiting period, at least for opportunities where a prospect can get his money back if not satisfied. Problem 2: You would be required to give every prospect a list of "references" – the names, addresses, and phone numbers of 10 other IBOs in the area – seven days before the prospect registers. This requirement would infringe on the privacy of every demonstrator whose name, address, and phone number was provided to prospects. It would also penalize the sponsor, who would be required to give his prospect contact information for 10 other demonstrators, any of whom might be happy to register the prospect themselves. Solution: Eliminate the requirement to provide 10 references. Problem 3: You would have to give every prospect a list of all lawsuits, arbitrations, or other legal claims for the past 10 years involving the company or it’s demonstrators where the plaintiff alleged fraud, misrepresentation, or unfair trade practices – regardless of whether or not the accusation was true. Among other problems, this requirement would open up legitimate companies to false accusations. Meanwhile, dishonest companies would simply ignore the rule. Solution: Eliminate the requirement to disclose past litigation. Problem 4: You would have to make a different disclosure for every income claim. This would include any examples you might use during a presentation to illustrate how the Plan works. Solution: If disclosures are needed, require a simple, standard, easily understood disclosure such as "average monthly gross income for 'active' demonstrators." Problem 5: You would be required to provide prospects with personal financial documents to back up ("substantiate") any income claim. Solution: Demonstrators should possess substantiation for any claim but should not be required to disclose it except when required by the FTC and similar state agencies in an agency investigation.