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Business Opportunities

Business Opportunities - The Beacon


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By: Amanda

Business Opportunities

“Be your own boss and make $60,000 a year from home!  No experience necessary!” 

You’ve probably seen employment ads containing that very language on websites and in the newspaper.  Your BBB continues to receive phone calls daily from consumers asking about ads that are very similar to the statement above.  While we all want to believe we can make a lot of money working from home, some of these offers are not what they seem.  In most cases, consumers are asked to provide a certain amount of money upfront prior to the beginning of the job or as seed money for an “investment opportunity.”  This money is often wire transferred to the individual that placed the ad, and either the job doesn’t exist or the “investment” is a bust.

Consumers thinking about getting involved in a business opportunity should know and understand the Business Opportunity Rule.  The Business Opportunity Rule, enforced by the Federal Trade Commission, is meant to protect people from buying into an opportunity that doesn’t exist by requiring certain disclosures and also spells out practices that are illegal. 

Under the Rule, the sellers are required to provide you with a one-page document that contains these five important points:

1. The identification of the seller;

2. Information on any lawsuits or other legal actions involving the seller or its key personnel;

3. Information on the sellers cancellation or refund policy (if they have one);

4. Information on whether or not the seller is making an earnings claim.  If they are, they have to provide you with an additional document called the “Earnings Claim Statement;”

5. A list of references.

The Rule states that this document must be given to you at least seven days before you sign a contract or pay any upfront monies.  The FTC and your BBB suggest you use that time to do your homework on the opportunity and the seller.  Read the disclosure document carefully.  Any inconsistencies between the seller’s explanation of the opportunity and the disclosure document may be a red flag.  Check out the seller with the BBB and call the references listed.  If the seller is making an earnings claim, you may want to read the earnings claim statement closely as well.

For more information on the Business Opportunity Rule, check out the FTC’s website and for more tips on work-at-home opportunities, visit

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Amanda is the Director of Bureau Affairs and is a regular contributor to the consumer education blog. She is one of our go-to colleagues for answering complex consumer inquires. Amanda also manages our charity reporting program.