| Comment Number: | 522418-10552 |
| Received: | 7/16/2006 5:18:35 PM |
| Organization: | Quixtar IBO |
| Commenter: | Mark De Matteo |
| State: | VA |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| No Attachments |
Comments:
Dear friends at the FTC, I have been a full-time Quixtar IBO since the fall of 1999 and wish to express my comments on your proposed ruling. While I am in favor of your intent to restrict or eliminate fraudulent business schemes, you're proposal causes my concern in the following areas, as it would seriously hamper my effectiveness as a legitimate business owner with a highly reputable company: Concern #1: Prospects would have to wait seven days after receiving disclosures before they could register. Solution: Eliminate the waiting period, at least for opportunities like Quixtar where a prospect can get his money back if not satisfied. Concern #2: We 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 IBO 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 IBOs, any of whom might be happy to register the prospect themselves. Solution: Eliminate the requirement to provide 10 references. Concern #3: We would have to give every prospect a list of all lawsuits, arbitrations, and other legal claims for the past 10 years involving Quixtar and its IBOs 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 Quixtar and other legitimate companies to false accusations. Meanwhile, dishonest companies would simply ignore the rule. Solution: Eliminate the requirement to disclose past litigation. Concern #4: We would have to make a different disclosure for every income claim. This would include any examples we might use during an opportunity presentation to illustrate how our Plan works. Solution: If disclosures are needed, require a simple, standard, easily understood disclosure such as "average monthly gross income for 'active' IBOs" Which we already provide. Concern 5: We would be required to provide prospects with personal financial documents to back up ("substantiate") any income claim. Solution: IBOs 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. While I commend all your efforts to thwart the deceptions of illegitimate companies, let's not tie the hands of good, honest ones in the process. Respectfully, Mark E. DeMatteo