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FTC GUIDELINES
As a courtesy to our clients we also like to make you aware of certain guidelines that exist
for your protection and established by the FTC.
According to the FTC information, here are a few important details concerning a Business
Opportunity, Sellers Disclosure Obligations, Earnings Claims, Legal Actions, Cancel Policy and References.
I. Business Opportunity Rule
Under the proposed Business Opportunity Rule, a business opportunity exists whenever:
| | a. | There is a solicitation to enter into a new business. This definition was intended to
exclude current business to business sellers. However the FTC implies that offering new
product lines or alternative merchandise to an existing business is considered a solicitation
for a new business.
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| | b. | The buyer makes a payment to the seller in cash; check or any kind of installment sale agreement; and
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| | c. | The seller either:
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| | (1) | Makes an earnings claim; or
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| | (2) | Represents that some type of business assistance will be
provided to the purchaser. Business assistance means the offer of material advice, information or support to a
prospective purchaser. The guideline also establishes the following as business assistance:
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| | 1. | providing locations/customer accounts
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| | 2. | the promise that the business opportunity seller will buy the production from the
business opportunity buyer; and
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| | 3. | paying commissions based on the purchaser’s product sales or recruitment efforts.
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For the above mentioned guidelines, refer to the main section on Earnings Disclaimers. We
do not ever pay on the recruitment of others. Our sales commissions are only generated
from the sales of customers/clients and/or referrals with our company.
II. Seller’s Disclosure Obligations
The FTC believes there are four critical areas to consider when a consumer makes a business
opportunity purchase.
- Earnings claims
A company is to provide an Earnings Claim Statement about any implied level of sales,
income or profit the buyer can make or other purchasers have made. Earnings claims include the following:
- The name of the person making the claim
- The date of the earnings claim
- The beginning and ending dates when the represented earnings were achieved;
- The number and percentage of all purchaser during the stated time period who achieved at least the
stated level of earnings;
- Any characteristics of the purchasers who achieved at least the represented level of earnings; and
- A statement that written substantiation for the earnings claim will be made available to the
prospective customer/client upon request.
It is for this reason, we do not typically quote or make specific income claims. Again, we do not want
to unfairly entice someone to get started in our business who would be swayed by a rare example of someone
earning a huge substantial income. This business takes work and effort like any business. We
lso like to downsell the impact of our program and don’t want to risk misleading a client in any way.
For example, if we told you that "Mr. Jones earned x dollars" and then on the other hand, we said that "Mrs. Smith
made y dollars" (which was exactly the same as Mr. Jones).
We have no way to truly track what they spent to make that amount of money. Maybe Mr. Jones spent 1/10th of
that amount to make it and Mrs. Smith spent more than she made to make that amount.
We don’t have a way to officially track what someone spends overall on their advertising or for their
business. The bottom line in any business is not what you take in as far as revenue (gross sales), it’s the
actual amount left over (net profit) that is one of the main indicators of financial success in business.
We can not possibly do the accounting for thousands of clients and therefore as a guideline do not used
exaggerated or high income claims. We don’t want to risk misleading you in any way. Instead we
will offer you all the support we can offer to help with questions you may have, however again, please know
that you’re results are your responsibility.
In certain cases where we use testimonials, they are true results to give you an understanding of how it may
work for you. It’s a theoretical example to show you how IF you did X, it could produce Y. Although
over 51% of our initial clients (effective May 1st, 2006) receive checks from our company, for the sake of the
legal requirements we will state that less than 1% of our clients earn any substantial money. In no way
does it reflect what could happen to you. For the examples listed or in our audio presentation, feel free
to visit the following area of our site (coming soon).
- Legal Actions – The guideline states that we must disclose any civil lawsuits or criminal actions involving
misrepresentation, fraud, securities law violations, or unfair or deceptive practice within the past 10 years.
We are proud to say that none of the key personnel in our company have had any type of civil lawsuits, criminal
actions, misrepresentation, fraud, securities law violations or unfair or deceptive practices at any time in the
last 10 years and as you can see by the above policies, we adhere to the policies in our industry.
- Cancellation or Refund Policy – The guideline states that we must provide a statement describing the refund
policy. Please see the section relating our refund and cancellation policy.
- References – A new proposed guideline in the works right now states that a company classified under the
Business Opportunity Rule must provide at least 10 purchaser references located nearest to the buyer.
Information must include name, address and telephone number so the prospective buyer can contact those
individuals to verify the sellers claims. It does not apply in our company, however the guideline
also states that if there are fewer than 10 purchasers, the seller must provide information on all.
For this reason our company is being proactive in giving access to all types of people and their comments
with our program. Some will ask that there contact information be left confidential as I think
this is a smart idea because it could lead to serious solicitation issues. You will also be given
the opportunity to provide feedback as well. To view the current list, feel free to visit:
http://www.certifiedmediaplacementspecialist-factorfiction.com
Please note, we take these guidelines very seriously. If any of our representatives or those independent
representatives have violated these policies, please inform us in writing at:
support@globalcashflownetwork.com
or at our mailing address of:
Global Cash Flow Network
1753 E Broadway
Suite #101-287
Tempe, AZ 85282
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