Home
>
Small Business
>
Bogus Investor and Consumer Complaints and Consumer Misrepresentation

Bogus Investor and Consumer Complaints and Consumer Misrepresentation

Like most regulatory bodies in the United States, the Federal Trade Commission gets investor and consumer complaints. But how much of these are actually real? These agencies then act on such complaints and increase regulations. Let's look at the Franchising industry for example. The complaints of fraud are non-existent for the most part in franchising, yet the FTC franchise group is dead set on making more regulations which in turn stifle the industry.

I recently talked to an NASD regulator who said that 75% of the complaints filed were frivolous, bogus or someone not wanting to take responsibility for their actions. Wow, 75%, that is high wouldn't you say? Is the FTC acting upon real complaints to come up with these new proposed rules? Or are the complaints you base your needs to make the rule simply 75% bogus. Are they 80% bogus, 85% or maybe only 70%. If the problem is really only 30% real or 15% real, then is that a significant reason for making a rule? No, obviously it is not. You are letting bogus complaints get the best of you at the FTC, just like you are wanting bogus inquires to get the best of franchisors. The real crime against the consumer will be the switch in attitude towards consumers by franchisors one, which will be based on reality and therefore justified if new franchise rules are imposed. Franchisor's are protecting themselves from bogus leads or fake franchise buyers. They therefore have put up a wall to protect them selves, it is called the screening process. It is justified and in place for a reason, to protect the integrity of their systems and the current franchisees (also consumers) who have already purchased and would like to make some money in this recession. The franchisees if this rule is enacted should be able to opt out of being listed on the UFOC for reasons of their right to privacy.

We cannot and should not make the UFOC available until which time we can verify all information given to us by the potential buyer. Remember I stated that 70% of all buyers exaggerate their financial situation. This is well known by franchisors as well as other sectors of our economy such as realtors, car dealerships and financial planners. One recent book I read put out by a major mutual fund company stated the number at 78%. Is it out right misrepresentation or is it more not understanding the reality of the banking system, cost of living, cash flow, or debt service on their own credit cards? Hard to say, but I guarantee you it is real. And it is a real problem with assisting new franchise team members in realizing their American Dream of owning their own business. These are some of the problems associated with franchisees and their financial capacity.

Other problems occur when potential franchise buyers do not fill out the entire form and leave sections out. A person who cannot follow the rules cannot join our team and most franchisors should ask very direct questions of the franchise buyer before moving on if this occurs. Sometimes it is simply a matter of the franchise buyer being scared of identity theft due to all the TV news segments on the subject even the FTC goes over board with these claims of possible "identity theft" to justify their worthiness to consumers and next years budget. Other times the potential franchise buyers are really hiding something. Sometimes franchise buyers will not tell you they are going through a divorce and they are buying the franchise to be self-employed to hide income from their former mate to save on alimony. We have received several of these from people who admit it, wonder how many did not tell us their objectives in owning their own business? We have even had franchise buyers lie about their hobbies. Why would they do that? Are they so worried of what others think of them? Unfortunately, yes. People will drive expensive cars when they are broke and it appears that this problem permeates our society, we know that we wash their cars, until which time they refuse to make good on the bounced checks. People, real people, real Americans and even the all mighty and glorious consumers lie about stupid things and in franchising you cannot help or suggest things to a franchisee team member who lies and still give good advice. Franchisors need franchisees to do well, and we owe it to the rest of the franchise team to only take on the best franchisees and that takes quite a bit of due diligence on our part. Until that process is complete we cannot offer the franchise to the potential franchise buyer.

Our franchise system like many others only offers our franchises to qualified franchise buyers. We do not offer our franchise to just anyone who has the money and surely not to anyone who does not. Just like an employer must screen applicants, so must a franchisor. And while I am at it, may I ask the FTC what a consumer who cannot balance their check book and doesn't even read their credit card statements for accuracy is going to do with a UFOC and it's attachments, for a franchise they are not even sure if they are interested in yet? Are they going to read it? All of it? And if they think they may possibly be interested in 10 different franchises are they going to read all ten? Are they going to read five, two, one? Probably none. This proposed rule helps, neither the consumer, purported consumer, the franchisor or it's current franchisees. And it will add inbound complaints to the FTC, which I will later discuss.

"Lance Winslow" - If you have innovative thoughts and unique perspectives, come think with Lance; www.worldthinktank.net/wttbbs

top rated cleaning service Lake Forest ..

In The News:

Holiday scams spike during Black Friday and Cyber Monday as criminals exploit your leaked personal data. Learn how to protect yourself from fake stores and phishing.

Commerce Department proposes TP-Link router ban over Chinese security risks. Learn how this potential prohibition could affect your home network and devices.

Hyundai AutoEver America suffered a data breach affecting 2,000 current and former employees, exposing names, Social Security numbers and driver's license information.

Washington court rules automated license plate reader images are public records, even when stored by vendors like Flock Safety, setting precedent for transparency.

Fake airline texts claiming flight cancellations are targeting travelers with convincing scams. Learn how cybercriminals steal personal data and credit card info.

Discover how iOS 26's new Adaptive Power feature automatically extends iPhone battery life by learning your usage patterns and adjusting performance intelligently.

New TikTok malware campaign tricks users into running PowerShell commands that download Aura Stealer, which steals credentials and authentication tokens.

Gaia Family offers fixed upfront pricing for IVF cycles with unlimited embryo transfers and financial protection, partnering with over 100 U.S. fertility clinics.

The Jetsons Act aims to position Pennsylvania as a leader in advanced air mobility by establishing regulations for hybrid ground-air vehicles.

Fake Geek Squad invoice emails are targeting users with convincing charges and urgent phone numbers to steal personal information and money.

Fox News Digital's artificial intelligence newsletter digs into a robot in Russia that faceplanted, George Clooney's alarm and OpenAI's rivalry with the New York Times.

Major data breach at Conduent exposes personal information of 10+ million people. Government contractor hit by cyberattack affecting Medicaid, child support systems.

Texas startup Janta Power raises $5.5M for innovative vertical solar towers that generate 50% more energy than traditional panels while using just one-third the land.

NASA's twin ESCAPADE spacecraft launched aboard Blue Origin's New Glenn rocket Thursday afternoon from Cape Canaveral, beginning their journey to Mars with arrival expected in 2027.

Learn how to set email reminders on iPhone and Android so you never forget to reply again. Simple built-in features help you stay organized and on top of messages.

Discover how Apple's passkeys revolutionize Mac security by replacing vulnerable passwords with biometric authentication and encryption for ultimate protection.

New survey reveals 78% of parents fear AI scams targeting their kids, yet nearly half haven't discussed these threats. Learn why this dangerous gap exists.

Chrome now autofills passport and driver's license info automatically. Google's latest browser update adds official document support with encryption and user control.

Scammers impersonate Department of Veterans Affairs employees claiming veterans owe money, but real VA communications only direct to VA.gov or official channels.

The AltoVolo Sigma hybrid-electric aircraft flies 500 miles at 220 mph while operating 80% quieter than helicopters, featuring safety systems and compact design.

Google search scam alert: fake customer service numbers can give scammers remote control of your phone. Learn how to spot these traps and protect yourself.

Electric vehicles overtake gas cars in total CO2 savings after just two years of driving, with emissions benefits growing over time as power grids get cleaner.

Louvre Museum reportedly used "Louvre" as password for surveillance system during $100M jewel heist. Learn how weak passwords put even famous institutions at risk.

Bipartisan AI jobs bill from Sens. Hawley and Warner would require companies to report AI-related layoffs and hiring to Department of Labor quarterly.

Joe A. from Shelton, Connecticut, lost $228,000 to a ZAP Solutions cryptocurrency investment scam after his divorce, highlighting rising online fraud.

Bogus Investor and Consumer Complaints and Consumer Misrepresentation

Small Business