|Received:||6/28/2006 8:08:48 AM|
|Subject:||Business Opportunity Rule|
|Title:||Notice of Proposed Rulemaking|
|CFR Citation:||16 CFR Part 437|
Comments:I applaud the effort of the FTC to crack down on illegal and fraudulent pyramid schemes. These illegal practices are what give legitimate network marketing businesses a bad name. I think many people who could benefit from becoming involved with a legitimate network marketing business do not ever get started because they may have been burned or know someone who has been burned in the past by someone out to make a quick buck. However, I think some of the FTC's proposals will hurt legitimate business more than they will cut down on illegal practices. 1) The 7 day waiting period. In a business like Quixtar, a sponsor has a very short window in which to help a prospect start earning income before that prospect loses interest. We live in a microwave society. The waiting period will only slow down growth. 2) Providing references and income disclosure. If we have to provide prospects with lists of IBOs and their income statements, that implies to the prospect that the prospect can earn that same type of income. When we present the business opportunity, we make sure to introduce them to our business team at meetings, and we share the SA-4400 showing the FTC-approved business plan and income opportunities. We let them know that our business, like any business, comes with no guarantees because it's based on each individual's performance. I believe that our presentation does a good job of explaining potential income and introducing prospects to others who have succeeded. 3) Providing a litigation list. We don't believe these past lawsuits have any relevance to a prospect's decision to become part of our business team because the litigation involves other teams and unique situations. Providing a prospect with a list of past litigation implies that we operate a shady or fraudulent business or that we are associated with those that operate underhandedly. If someone wants to research litigation, they can find it easily enough on the multiple Quixtar hate Web sites. I think the fact that we have the BBB stamp of approval and that we partner with Fortune 500 companies speaks of our legitimacy. The number one thing that I believe sets Quixtar apart as a legitimate opportunity in a prospect's eyes is the money-back guarantee on registration and products. I have been in business for 3 years, and I present the opportunity the same way it was presented to me: as an opportunity that takes work, requires a small initial investment (which can be refunded for up to 6 months), and provides no guarantees. I am out for the long-term, and I believe that being up front and honest with a prospect is the only way to operate a successful business. I don't think that placing additional restrictions on network marketing businesses will help crack down on illegal pyramid schemes (they won't follow the restricions anyway because they're already breaking the law). These restrictions will only place a burden on legitimate businesses. In fact, the only thing I would offer as a new proposal would be to require network marketers to give prospects a disclaimer describing how to identify illegal fraudulent schemes, and explaining how what we do is legal.