|Received:||7/1/2006 8:24:56 PM|
|Organization:||Schluep and Associates|
|Commenter:||Thomas Schluep Jr.|
|Subject:||Business Opportunity Rule|
|Title:||Notice of Proposed Rulemaking|
|CFR Citation:||16 CFR Part 437|
Comments:After reading the proposed rules for 16 CFR Part 437, there are many things that I greatly appreciate and feel will do the public a tremendous amount of good, however there are other aspects that I feel would hurt my existing business as well as other businesses in our ability to perform. While it is important to protect people from being scammed, it is important not to hurt people that are legitimately engaging in the direct selling industry on a regular basis. I agree that there should be standardized income disclosures that apply to direct sellers, and I also agree that when engaging in any type of business with a direct seller there needs to be a reasonable cancellation policy. These two steps alone would do a considerable amount in stopping preventing the various scams from occurring without doing any damage to honest businesses. I do not feel that the 7 day waiting period after receiving disclosures is necessary. If there is a reasonable cancellation policy in place this only infringes upon their ability to do business for themselves in a Country built on Free Enterprise. Perhaps a better solution would be to only make this apply for business where someone would be unable to get their money back, or to remove this rule entirely. I take great offense in the requirement to give prospects a list of 10 references seven day prior to registration. The first problem with this is that I find it to be a huge privacy violation. I would never want my personal contact information given out to someone interested in being involved my industry. Second, for me to do this with my own prospects gives them 10 other choices of people to go into business with other than myself, and is essentially giving away the names of my competitor's for them to do business there after I have already spent countless hours providing them with information to review. Primarily for these two reasons I think this requirement needs to be removed. The requirement to remove past litigation should be removed as well. Any dishonest company involved in a substantial when it comes to alleged fraud or misrepresentation is unlikely to remain in business, however it opens the door to legitimate companies receiving additional false accusations by their competitor's trying to tarnish their business record knowing that even if the allegation is false it would be required for the company to disclose those records for a 10 year period. If a company is dishonest and is involved in said fraud or misrepresentation, they would be unlikely to follow this statute anyway, and I only see it hurting honest and legitimate companies. It is easy to make an accusation, but just because it is not accusation does not mean it contains truth. I do not feel that a different disclosure should be provided for every income claim, but rather use a standard income disclosure based on average monthly or average annual income. This would allow for accurate income claims to be made without additional documentation as any false claims would be quickly offset by viewing the standard claim, and it does not allow dishonest companies to only show their best income claims. Lastly, I do not believe I should be required to provide prospects with personal financial documents to substantiate any business claims. I believe I should be required to possess documentation for any business claim that I make (which I always have). I should only be required to disclose this documentation if required to do by the FTC, a court of law, or a State agency involved in an investigation. I do not want to be providing all of my financial statements to the public for a private business that I own, but I do keep accurate documentation to substantiate any claims that I make for when it is needed. I feel it is a tremendous violation of my personal freedom to disclose this type of documentation for every claim that I make.