The Department of Justice Federal Trade Commission consumer protection division is proposing new rules to protect consumers from fraudulent business opportunity scam artists. One of the biggest complaints from consumers at the Federal Trade Commission regarding business opportunities is that often the business opportunity practitioner will not refund the money that they guarantee if the buyer is not satisfied. Often such money back guarantees are listed on brochures, web sites in the general media advertising. To combat this problem the Federal Trade Commission has proposed the following rules to help consumers from being ripped off by on ethical practitioners; Proposed section 437.5(l): Failure to cancel or make a refund Proposed section 437.5(l) would prohibit a seller from failing to cancel a purchase or make a refund when the purchaser has qualified for such relief under the sellers cancellation or refund policy. As noted above, proposed section 437.5(k) would prohibit a seller from misrepresenting, pre-sale, the sellers cancellation or refund policy. Proposed section 437.5(l) complements that section and is intended to address sellers post-sale conduct, prohibiting the seller from failing to honor cancellation or refund requests when purchasers have satisfied all the terms and conditions disclosed in the sellers basic disclosure document for obtaining such relief. In our experience, the failure of business opportunities sellers to make promised refunds or to honor cancellation policies ranks high among issues raised by business opportunity purchasers. Now mind you that there are many ethical practitioners in the business opportunity sector, however there is also quite a bit of fraud and that hurts the ethical practitioners. We consumers are ripped off, they are very upset, would you be? The Federal Trade Commission hopes to alleviate this problem and make it a crime to unlawfully withhold refunds that were guaranteed in the event of the cancel of the business opportunities sale. I hope you'll think on this in 2006 |
