|Received:||7/7/2006 12:30:52 PM|
|Subject:||Business Opportunity Rule|
|Title:||Notice of Proposed Rulemaking|
|CFR Citation:||16 CFR Part 437|
Comments:Some MLM's have Pin Levels that supposedly represent income levels. Some of those Pin Levels are represented by names of precious or semi-precious metals or stones or social status. (Platinum, Saphire, Emerald, Diamond, Ambasador, Crown etc.) Many individuals who achieved one or more of these Pin Levels have failed to continue to meet the required criteria. These individuals CLAIM to hold a high pin level but no longer have the business level required to achieve the income represented for the particular Pin Level. It is fraudulent for themselves and/or others to continue to represent these individuals as Qualified for the Pin Level they claim to be. If individuals DO NOT meet the MLM's stated qualifications they will NOT actually be that level. To eliminate any possibility of misrepresentation/fraud these people SHOULD be COMPELLED to state that they ONCE WERE a particular PIN LEVEL and should also be COMPELLED to divulge their CURRENT ACTUAL PIN LEVEL. This fraudulent misrepresentation of Pin Level is a strong motivating factor in causing prospective recruits to enter the MLM. Total Active Distributors is another fraudulent deception used by some MLM's to recruit new members. One huge MLM in particular states that Active means that a distributor/business owner: 1) Attends at least one business event a year 2) Talks to at least one person per year about joining the business 3) Makes at least one retail sale of product a year. Using this loose criteria a MLM can grossly over state (exagerate) actual distributors, business owners, affiliates etc. to influence potential recruits. This is another area of truth in advertising/representation that should be addressed.