Comment Number: 522418-01465
Received: 6/8/2006 7:31:15 PM
Organization:
Commenter: Daniel Bellows
State: NY
Subject: Business Opportunity Rule
Title: Notice of Proposed Rulemaking
CFR Citation: 16 CFR Part 437
No Attachments

Comments:

Dear sir/madam, I am writing this letter to express my strong opposition to the proposed Business Opportunity Rule R511993 as it is currently written. I believe there are some positive aspects to the rule, however there are just as many negative aspects. Allow me to explain. This rule seems to deal with multi-level-marketing programs, many of which merit watching. However for many of these programs this rule and its requirements would be a hindrance for many new people that are recruiting people into their downline. The requirement of showing the name, city, state, and telephone number of at least 10 purchasers within the past three years who are located nearest to the prospective purchaser's location could potentially violate privacy laws and issues. Some persons may not want people to be aware of their working in an M-L-M program because if may jeopardize their regular employment. Please keep in mind that many people involved with M-L-M programs are doing so as a means to either earn extra income and/or have enough income to remove themselves from the day to day job they currently work at. Some employers may not look favorably on that and it could lead to difficulties for the employee. I do agree that a record of orders and cancellations should be available for prospective members should be made available. This would allow them to be able to see what the normal order flow and return/cancellation numbers are. This may help dissuade or encourage the prospective member into the proper decision. I have had the experience of joining a M-L-M program not knowing if the sales would be there, only to discover they were not as strong as claimed. The biggest obstacle is probably that, under the proposed Rule, the disclosure document must be presented to the potential recruit at least seven calendar days before the recruit may sign an application or make a payment. A separate disclosure document is required if ANY earnings claim is made. Each application, disclosure statement, disclosure receipt and oral or written request for cancellation would have to be maintained for three years. The difficulty I see in this is that many people, myself included, do take time to research the programs before joining. Granted that when I was in my 20s I did not do so, but with age comes wisdom and I pass that on to people that I have heard are considering joining an M-L-M program. If there is a seven day waiting period it could create a drop off in recruits that feel they should be able to join now and not have to wait. Also, as required by law currently, the person that joins does have an allowed 30 days to cancel their membership with a full refund, minus any items actually purchased by the member for their own use. Personally I feel the law is good in concept, but I believe it needs more refining before being placed into effect. To that end I am willing to provide any assistance in providing my comments and opinions as requested or needed. Thank you for protecting the rights of the people of this great country, your work and efforts are greatly appreciated by many people, and I feel that you (everyone in the FTC) do not hear that often enough. God Bless! Daniel W. Bellows