|Received:||7/17/2006 2:10:42 AM|
|Subject:||Business Opportunity Rule|
|Title:||Notice of Proposed Rulemaking|
|CFR Citation:||16 CFR Part 437|
Comments:We have been a Quixtar IBO since 1999 and while we have not accomplished all our goals, we recognize that our lack of business activity has been responsible. The business development system this business offers has had a positive affect on other areas of our life in adition to the business area. The corporation has developed extensive and clear information regarding the Quixtar business opportunity and income potential which we offer to prospective and new IBOs. We make it clear that this is a business opportunity and requires planning and performance to be profitable. It clearly is not a "get rich quick" scheme and sucess is in direct proportion to the committment of time, resources and effort invested in one's business. Not unlike traditional businesses. We recognize that there are bogus business opportunities attempting to mimic legimitate direct-selling opportunites and deceive and defraud the public. We additionally applaud the FTC's efforts to shut them down and protect the public. Howevever, we believe that the proposed solution contains several requirements that would impose crippling burdens and penalize honest entrepeneurs. 1. The requirement of a 7-day waiting period after receiving disclouses before registration would severly and unfairly limit the ability to develop new businesses. New IBOs would have to wait before developing their business and hamper their business development growth. Prospects and new IBOs are already offered a money-back guarantee if not satisfied so the wait is unecessary. 2. The requirement to provide 10 references is a gross infringement on the privacy of IBOs who have a right to not have their personal information given to individuals they don't know. Many IBOs are among the thousands of home-based businesses whose business and personal information are the same. For those unscrupulous scam artists out to benefit from the efforts of others rather than doing the work themselves, they are provided a list of contacts that they could steal and use themselves. Prospects and new IBOs are invited to public presentations of the business plan and have the opportunity to meet and dialog with IBOs in our organization to examine the credibility of the business so the provision of a reference list is unncessary. 3. The requirement to provide a list of past litigation involving fraud, misrepresentation or unfair trade practices regardless of merit is not only useless but exposes legitimate companies to false allegations while dishonest companies could ignore the requirement. 4. The requirement for specific earnings disclosure creates an unrealistic burden on small businesspersons and is meaningless. Business production would be severly hindered by requireing small one-person businesses to develop a seperate disclosue for every example used to explain the income potentital. Quixtar's business opportunity rewards the business that does the most work thus, it is not unusual that many new IBOs exceed earnings of their business mentors. Quixtar prospects are provided with a SA-4400 which gives average monthly and yearly gross earnings for "active" IBOs. 5. The requirement to provide prospects with personal financial documents is another invasion of private business information. Other privately held business do not have to disclose financial data to the general public. We do share approximately how much money was made in the previous year and the financial impact the business has made on our lifestyle. It would not be appropriate to require sharing of Quixtar income to general public because many IBOs file Schedule C which would also expose non-Quixtar income. Again, we agree that providing every prospect with important information about prior experiences is good for Quixtar and the entire direct-selling industry, however, there are less buedensome ways to accomplish that goal than the manner proposed in this rule.