Since the inception of the FTC Franchise Rule (16 C.F.R. § 436.1), the FTC has brought more than two hundred enforcement actions under the rule. The FTC has been particularly successful at stopping fraudulent business sales related to the sale of vending machines and rack displays. However, the FTC Franchise Rule has been unsuccessful at stopping Read More…
MLM & Affiliate Marketing
Understanding The FTC Business Opportunity Rule
There are certain requirements to be followed for offering a franchise or a business opportunity. We have all seen the following types of claims on websites: “Be Your Own Boss!” …..“Work Part-Time from Home” …..“Earn $5,000 a month with our System”… “100% return on your investment guaranteed!” or “Quick and Easy!” …..“Start Earning Today.” These Read More…
MLM Income & Earnings Disclaimer Use 101!
Specific earnings and income claims entice the customer. These claims are often made in connection with offering business opportunities and with MLM plans online. Misleading earnings or income claims are deceptive and illegal in general under Section 5 of the FTC Act. But, they pose other concerns in connection with offering business opportunities and in Read More…
Is Your Business An MLM Pyramid Scheme?
Business engaged in multi-level marketing need to ensure they are not conducting an illegal MLM pyramid scheme! Multilevel marketing plans are evaluated by the method which the products or services are sold and the manner that participants are compensated. Essentially, if an MLM plan compensates participants for sales by their recruits, and their recruits, that Read More…
10 Concerns Affiliates Pose To Your Business!
Affiliate marketing can be particularly risky to your business in terms of liability exposure. There are a number of concerns, ranging from liability for affiliate spam under the CAN-SPAM Act, violations of disclosure responsibilities under the FTC Act and even affiliate trademark infringement. In fact, this list is quite expansive. However, it is possible for Read More…