| Comment Number: | 522418-09342 |
| Received: | 7/14/2006 12:07:41 PM |
| Organization: | Quixtar |
| Commenter: | John Hangebrauck |
| State: | CA |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| No Attachments |
Comments:
As a family, we have earned our living for more than 3 decades through the opportunity provided by the Alticor Companies. We are always interested in any attempt to eliminate the fraudulent schemes and high-cost franchises that take advantage of the public. These schemes definitely damage our entire industry. However, the proposed guidelines outlined here are off the mark, and can be misused by the illegal operations, while doing extreme damage to the honest ones. The FTC proposals would actually penalize honest IBO's and cripple our sponsoring efforts. First, there should be no waiting period for the opportunities like Quixtar, where a prospect can get his money back if not satisfied. Out in the marketplace, there is no need for consumers to have to wait to move ahead on a purchase of a quality product that is guaranteed. So why require this of us? A waiting period would be extremely detrimental to the momentum of business building. Secondly, the requirement of giving every prospect a list of "references" could so easily be abused by unscrupulous opportunities. We have witnessed dozens of companies over the years providing bogus testimonials to their prospects. This requirement would only hurt the honest business builders, while doing nothing to the dishonest ones. And what benefit is it to require a list of lawsuits, etc. be given to a prospect? What is to prevent other companies from compiling a list of false accusations against our Quixtar opportunity, and showing that to their prospects? Dishonest companies could also simply ignore the rule. And there have been so many "new" companies that tout the advantage of "getting in on the ground floor" that don't have enough history yet to have accumulated any lawsuits. They would always have the advantage. As far as disclosures of every income claim, we would instead recommend, if needed, a simple, standard, easily understood disclosure such as "average monthly gross income for 'active' IBO's." In fact, we are already providing that. And we should not be required to provide prospects with any personal financial documents to substantiate any income claim - - except when required by the FTC and similar state agencies in an agency investigation. This again could so easily be manipulated by unscrupulous people. In our opportunity, a person just getting started in the business can easily make more money than the person who introduces them initially. And it happens all the time. The proposal of putting attention on personal financial documents, would send an inaccurate signal to the prospect, and erroneously infer that the person offering the opportunity needs to be successful for the prospect to have potential - - -this being untrue. We truly encourage the FTC to help us clear the marketplace of dishonest business opportunities. But we also don't want rulings that literally could put honest businesses out of business, by inadvertently writing rules that hamper our honest methods of building our livelihood. Thank you for considering our requests. Sincerely, John & Carol Hangebrauck