| Comment Number: | 522418-10498 |
| Received: | 7/16/2006 3:39:08 PM |
| Organization: | Quixtar |
| Commenter: | Don Wilson |
| State: | UT |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| No Attachments |
Comments:
The U S Federal Trade Commission I have been involved in building a business opportunity powered by Quixtar since 1972. My wife nancy and I fully support your efforts to protect the consumers of this country from fraudulent business opportunity companies. we have worked to build our legitimate business and applaud your efforts to regulate the bad players. We have watched many prospects be lured away from our business by companies offering income and lifestyle exaggerations which are not supported by the facts. We support your efforts to eliminate companies and individuals in the market place who operate without disclosures. We believ in alevel playing field for the legitimate companies. There are several parts of the rule which we feel would potentially make our business not workable in the future. Since we have invested over 30 years of our life in the efforts to build a solid business for our family, we would strongly urge you to re-think some of these provisions. 1. Making it a requirement to provide a prospect a list of references of 10 IBO’s in the area is not reasonable. We have an internet business which has an order fulfillment capability to ship anywhere in the U.S. We are able to recruit new people literally anywhere in the 50 states. Providing a local list of 10 names would require a national database of names of IBO’s which would need to be accessed from any IBO at any time. This would present a huge liability for anyone whose name would be placed on the list. These names would also be available for anyone to acquire so they could solicit them for any purpose including a competitive business opportunity. 2. Giving all prospects a list of all lawsuits, arbitrations, or other legal claims for the past 10 years where the plaintiff’s alleged fraud would be a burden. Many of such cases have been arbitrated under confidentiality. No one would know the results of the allegations. Many of the cases in the courts have been moved thru our dispute resolution process and found to be frivolous or lacking facts. With a company as old as ours (over 40 years) this could prove to be a huge physical stack of documents for a prospect to mull over. Since our business costs less than a hundred dollars to join, not many would want to enter a new enterprise that presented them with such a negative view of their potential experience. I would imagine that many new start-up enterprises which might truly be unethical would not have any legal cases to present to the new prospect. Our stack of unproven allegations would be much higher than their stack of legal complaints. This would create a competitive advantage for them. This proposal should be eliminated. 3. Making prospects wait 7 days after they receive disclosures before they could register seems unnecessary if a company has a proper Consumer Buy Back provision in place. We already have a provision which allows a consumer a receive their money back if they are unsatisfied after getting involved. We do not have an inventory requirement at signup so there is no money made on the act of recruitment. This 7 day rule is unnecessary if business opportunity companies have a consumer buy back provision and do not allow inventory loading at signup. 4. Requiring IBO’s to provide prospects with personal financial documents to substantiate income claims would create privacy issues to anyone doing so. One of the most impossible tasks in life would be to work a business for 30 years along side other business interests and then at some point try to decide which profits would be responsible for which of your personal assets. It would potentially put them at risk to legal suits from lawyers who would love to see someone subjectively try to document this everyone to study. This should be eliminated because it makes no common sense. Thanks for listening. Don and Nancy Wilson