| Comment Number: | 522418-11879 |
| Received: | 7/17/2006 4:16:16 PM |
| Organization: | |
| Commenter: | Wayne Bohlke |
| State: | MN |
| Subject: | Business Opportunity Rule |
| Title: | Notice of Proposed Rulemaking |
| CFR Citation: | 16 CFR Part 437 |
| No Attachments |
Comments:
REF: CFR CITATION--CFR 16 PART 437 Business Opportunity Rule R511993 Upon reading the sugested rulesunder this citation the need for some FTC action is understandable. The work of the Commission is much appreciated by many of us in business. I have been in business over 40 years ranging from a Officer of a Fortune 500 Company doing acquisitions, operating my own 3 store retail business, financial planning and also direct selling. The direct selling business has supplied some discretionary income and contact with people in my retirement years which is very important to me and other people during our retirement years. It is a business that allows for easy entry, usually at little or no cost and a completely flexible work schedule if properly structured. Generally the amount of capital commitment is small. Anyone I speak with is cautioned that the committed money for the first purchase will be the extent of their "loss" even if they decide to stop. In some companies, such as XANGO, even the amount of the initial order (about $100) is refunded if the new participant cancels within 30 days. It is refunded even though the participant is allowed to keep the product. Their net "cost" is $35 signing fee and the shipping fee if they quit. Perhaps some regulation is needed but after thinking this through with regard to a couple of MLM's I have been involved with, I think the "one size fits all" ruling is not a good approach. I would suggest those requiring a large "up front" purchase of supplies, marketing materials, merchandise etc. should have more stringent requirements than the small (<$1000) of many MLM's. Although some regulation is probably needed, it appears to me the 7 day rule, nearest list of 10 nearest sales persons, earnings claims and the elimination of the $500 threshold place an undue burden on legitimate companies. I'm sure that is not your goal. I happened to get involved with one of the scam outfits several years ago and I appreciate your effort in eliminating these scam artists. I respectfully request that you review these rules with some legitimate MLM's and develop rules that stop the scam artists without placing a burden on the good ones. Respectfully Submitted: Wayne N. Bohlke