| Comment Number: | 522418-05036 |
| Received: | 6/29/2006 11:08:20 AM |
| Organization: | Mt Hermon Distributing Co |
| Commenter: | Melvin Duplisea |
| State: | FL |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| Attachment: | 522418-05036.pdf Download Adobe Reader |
Comments:
June 28, 2006 Federal Trade Commission Office of the Secretary Room H-135 (Annex W) 600 Pennsylvania Avenue, NW Washington, DC 20580 Subject: Business Opportunity Rule, R511993 We both lost our employment careers in early 2005. We decided to explore the Home Business opportunities. With XanGo, LLC we have found the opportunity that fits our life style and financial goal. We appreciate the FTC’s consumer protection priorities, but we are quite concerned that the five-disclosure requirements impact will have on our legitimate direct selling company. We understand your need to disclose fraudulent groups but the requirements unfairly target our legitimate business. We wish to address the “five disclosure requirements in the proposed rule”. 1. Seven day waiting period: This waiting period will certainly inconvenience and “chill” enthusiastic individuals anxious to participate in the XanGo business opportunity. XanGo requires a very minimal up-front financial investment and XanGo has a generous buyback policy that presents little or no risk to a prospective purchaser. 2. List of nearest references: This requirement is overly burdensome and evokes confidentiality and privacy concerns for all involved. This requirement is not being limited to bona fide purchasers but also to anyone who may be interested, including competitors. The reference information could then be used for any purpose. 3. Earnings claim statement: The proposed rule requires complex and time-consuming data of time periods, demographic and earnings claims. This presents great difficulty in meeting the proposed requirements. 4. Legal actions: This disclosure of all legal actions during the previous 10 years comes with a serious drawback – it does not provide for the disclosure of the outcome of the litigation. 5. Cancellations and refunds: Xango will be able to maintain and update this for its distributors. However, this disclosure can be misleading in that distributors often join to achieve specific, short-term objectives, leading to a high cancellation ratio that is not representative of the satisfaction of the average new purchaser. Sincerely, Mel Duplisea – President Cathy Duplisea – Vice President Mt Hermon Distributing Co. (An independent XanGo distributor)