|Received:||6/26/2006 9:46:38 PM|
|Subject:||Business Opportunity Rule|
|Title:||Notice of Proposed Rulemaking|
|CFR Citation:||16 CFR Part 437|
Comments:I agree that protecting the consumer is an important goal. However, I do not believe that this protection should come at the cost of free enterprise. There is an economic law known as the "law of diminishing intent". It basically states that action needs to be taken within 48 hours of a decision being made or the excitement of that decision fades. I am in the direct selling business and it has changed my life dramatically. If I had waited for seven days and received all of the "negative" information about the company before making a decision I wouldn't have made it. I believe that a better protection would be to simply create a law that guarantees a full refund of any registration fees for a specified amount of time. That way a person could try the business with no risk and if it was a scheme they could recover their investment. Another consideration is the proposal to show past litigation. There was a study done that the top two ways people think they will get rich is through the lottery and litigation. There are millions of frivolous lawsuits out there and to require a business to list each one whether it was found liable or not is ridiculous. The final portion I disagree with is the requirement that financial records should be disclosed. The problem with this is that the structure of ones business has a direct impact on the income. If I show someone how much I make from my business they may expect to make the same amount. Depending on their effort they may make more or less than I do. It isn't fair to the person you are sharing the idea with to let them think that they will do the same as you. The most you can do is show them exactly how the compensation plan works and let them decide how they want to proceed. In conclusion, my recommendation would be to pass a law that protects the consumer by requiring a specific period to request a refund but doesn't put an undue burden on the person to weed through frivolous law suits, compare specific bonuses, or lose their excitement by being required to wait seven days.