Comment Number: 522418-06819
Received: 7/7/2006 4:03:32 PM
Organization:
Commenter: Alexander Burgess
State: MD
Subject: Business Opportunity Rule
Title: Notice of Proposed Rulemaking
CFR Citation: 16 CFR Part 437
No Attachments

Comments:

I am writing this to provide you with my input to your proposed changes (16 CFR 437). As a Quixtar affiliated Independent Business Owner I support the types of clear disclosures we use in our business dealings, but it seems that there are numerous fraudulent activities that have tarnished the name of all business opportunities - but your proposed changes simultaneously go too far and do not accomplish what you seek. We can appreciate the fact that you try to serve the public interest by ensuring a level playing field, but it seems no one can save everyone from mistakes (as my father, an experienced salesman, just fell victim to the oldest internet overseas fraud scheme). The background you include in the history of the proposed change seems to lump ours and other Quixtar businesses into the same category as all of the get-rich-quick schemes, envelope-stuffing, fly-by-night 'opportunities' that plague each town's PennySaver with lures, often under a rotating business entity to avoid detection. I am offended by your comparison and am disheartened that your proposed 'fix' would not alleviate the underlying problem. Instead of creating burdensome, complicated requirements -when your own site details how the FTC can not handle the workload they have now - let me propose a cost-effective solution for you. Go beyond simply seeking input and work directly with the businesses that will be affected most by this (Quixtar, among others). No one wants to be lumped into the same category as charlatans and most of the reputable business opportunities already provide clear financial disclosures. Surely it would be easier to use the Quixtar disclosure form (4400) or other industry standard as a benchmark to ensure a level playing field than it would be to create a new burdensome, confusing system. As for reasonable cancellation policies, I again believe Quixtar is an industry leader that many businesses could easily adopt the same policies, but to require a mandatory wait of seven days casts a pall across the experience that would not only seem to imply the government finds fault with what the consumer is about to do but would also devastate the momentum I am trying to create in my own independent business. The bulk of your proposed other changes would be costly, an unfair burden and would in some cases not only create opportunities for fraudulent activity where none exists now, but violate privacy laws. For example, your proposed rule concerning providing a list of 10 Independent Business Owners to each prospect would require a separate list for each geographic area, would it not? With Quixtar I have the ability to work in over 80 countires and foreign markets, beyond all of North America. Does that mean I would have to seek the written permission of those business owners and/or that I would have my name and personal information being provided to people I have not met? What of the possibility of some trusting Quixtar IBO being taken in by one of your all-cash candy route guy recently flushed out of business - only to be repaid by having this individual personally register every person who seeks his advice, just because he has the right address not the right qualifications. The list of litigation (pending, current, with/without merit, etc.) would apply to corporate entities, individuals, or anyone having a financial interest? In my case, I would not know how to begin even compiling a list like that nor how it could help the consumer as the businesses it would ideally help are the same ones you say routinely change their business names without adjusting their practices. If I had more space I could make fairly similar points for most of your other proposals. In conclusion, I believe the crux of the underlying issues could best be addressed by using standardized disclosures and reasonable cancellation policies but without adding in new requirements for seven day waiting periods, a list of references, litigations, financial documents, etc.