International Law

Cuppy's Coffee Interview

Posted on October 07, 2008
Image via WikipediaSean Kelly has an interesting conversation with a Cuppy's Coffee Franchisee, which highlights the big mistake prospects make in reviewing a franchise opportunity.UF:  How did you first learn about the general concept? What did you find appealing about this type of business? Joshua:  Coffee business here in California was booming...

Are Canadian Mary Kay Consultants Telemarketers"

Posted on October 07, 2008
Image via WikipediaInteresting observation over at Pink Truth about the Canadian Telemarketing rules:Canada now has a "Do Not Call List", and Mary Kay Inc. is advising consultants that they are subject to it. The way I read MK's explanation, if a consultant in Canada wants to call "referrals," they're going to have to register and pay a fee...

Robert Nozick Explains Credit Crunch?

Posted on October 07, 2008
Book cover via AmazonYou know that craziness has set in when Robert Nozick's peculiar libertarian theory is being invoked as an explanation for the current credit crunch.Richard Epstein makes the extraordinary claim in Forbes today:"Now that yesterday's market nosedive shows the disappointing Congressional bailout has not calmed markets, let the post-mortem begin...

Kevin Trudeau Banned from Infomercials

Posted on October 07, 2008
Image via WikipediaFrom the FTC Press Release about Kevin Trudeau:A federal judge has banned Kevin Trudeau from infomercials in which he has an interest for three years and ordered him to pay more than $5 million in profits from his book, "The Weight Loss Cure 'They' Don't Want You to Know About...

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What Not to Wear

Posted on October 06, 2008
Image via WikipediaOn this blog, I have spent a great deal of time talking about confirmation bias, anchoring, and cognitive dissonance and how they relate to franchise due diligence.Experiments, horror stories, and academic papers have all been cited in an attempt  to explain what to do...

Bailout Bad Medicine?

Posted on October 06, 2008
Image via WikipediaI have no special knowledge about financial theory, special purpose vehicles, or counterparty obligations. So, the technical details of our current credit crunch eludes me. However, I do have a pretty good ear for fraud talk - especially when it is wrapped up in self-deceit, shrouded by technical nonsense, and hidden agendas...

Shop to Earn Scam

Posted on October 06, 2008
Image by Chandra Marsono via FlickrTracy Coenen has a long post about Shop to Earn, in which she questions the basic business model."There are still plenty of people searching for "Shop to Earn scam," ShopToEarn fraud, "is Shop to Earn legitimate," Shop To Earth scam, and the like...

Insincere Cheers

Posted on October 06, 2008
Image via WikipediaWhat does opera have in common with elections? In the 1820's , the opera claque was formed - organizations which leased themselves to singers and opera companies to provide long sustained applause so that those in attendance would be assured that they had witnessed a brilliant performance...

Mystery Shopping Investigation

Posted on October 04, 2008
Image via WikipediaRecently, someone emailed me and asked about whether Gapbusters Worldwide was a fraud or scam Here are the steps I took, which you can easily use for your own investigation on similar businesses. The first thing I am trying to do is eliminate things that look like scams or frauds...

The Way I Figure It.

Posted on October 03, 2008
Image via WikipediaFrom the annals of banking history - a conversation with a banker who sold securities paying 50% every six months."Now the way I figure it.  I have about 8 million in the banks right now, and I owe 15 million.This run that's started has people bringing in their notes before they're due, so I will save the 50% on every one I get back...

Are Cheap Placebo's Worthless?

Posted on October 03, 2008
Image via WikipediaTwo years ago, the FTC was in Federal Court suing the manufacturer of the Q-Ray bracelet.  From the FTC press release regarding their legal case against the Q-Ray company"The federal district court in Chicago has ruled for the Federal Trade Commission in its case against the marketers of the Q-Ray ionized bracelet following a bench trial earlier this summer...

Risky Business: When your Franchisor Transforms

Posted on October 03, 2008
Image via WikipediaThe average life of a corporation is 12 years. But the death of a corporation doesn't mean it became bankrupt - a number of other ends are possible, change of control, merger, amalgamation, spin-off of divisions. In the WSJ, September 23, 2008, it was written: "About the last thing someone thinks about when buying a franchised business is what happens if the franchiser declares bankruptcy...

Is Direct Selling a Niche?

Posted on October 03, 2008
Image via WikipediaDavid Greiman writes about the direct selling industry:"Product demonstrations now take place at parties and workshops in which potential customers become captive audiences as they learn about - and try - everything from kitchen and health items to lines of jewelry and homemade crafts...

How Stupid Are Canadians?

Posted on October 02, 2008
Image via WikipediaCanadians are just as silly as Americans.  When the CRTC create the do not call system, the system was overwhelmed with people trying to sign up.I have always said that putting your name on a list saying that you are vulnerable is plain silly - someone is going to sell that list to telemarketers...

Jocks and Magical Thinking

Posted on October 02, 2008
Image by Getty Images via DaylifeOne of the tough challenges for rational theorists is the prevalence of magical thinking, superstition among apparently reasonable thinking persons. Matt Hudson, writing at the Psychology Blogs:" Wade Boggs ate chicken before every game during his career...

Is a Franchise Right for You?

Posted on October 02, 2008
Image via WikipediaKelly Spors, of the Wall Street Journal, has a good insight into some bad decision making - the purchase of a franchise by a naive purchaser."It's a common scenario: Someone walks into a chain restaurant, loves the food and ambiance and suddenly thinks, "I should own one of these...

Being Smart about Greed and Fear

Posted on October 02, 2008
Image via WikipediaWarren Buffett summarizes why we will have bubbles for the foreseeable future.This is more complicated than Buffett makes it seems, so pay careful attention."I mean people -- people don't get -- they don't get smarter about things that get as basic as greed and you can't stand to see your neighbor getting rich...

Why Do You Believe the Con Man's Lies?

Posted on October 01, 2008
Image via WikipediaInteresting story from the Telegram, UK about a brazen conman and his victims:"Fraudster Mark Wilkinson fabricated outlandish "business opportunities" to cheat £114,000 from his unwitting victims - including pretending he had been gifted a palace and millions of pounds from a generous Arab sheikh...

Canadian Quiznos Franchisee Association

Posted on October 01, 2008
Image via WikipediaOne of my standard recommendations when looking for a franchise is to contact the independent franchisee association. However, the formation of independent franchisee associations can be fraught with danger and legal actions. Consider the attempt to form a Canadian Quiznos franchisee association, as reported by the Court of Appeal in Ontario...

Directors Financial Group Prime Bank Fraud

Posted on October 01, 2008
Image by Getty Images via DaylifeI am fascinated as to why the Prime Bank scheme continues to work, given the amount of public information out there. From the SEC Press Release on Directors Financial Group Prime Bank fraud: "The Securities and Exchange Commission (the "Commission") announced today that on September 29, 2008, it filed a civil action in the U...

Drinking and the Dollar Auction Game

Posted on October 01, 2008
Image via WikipediaPresh  Talwalkar writes a very interesting blog, Minding Your Decisions. Recently, he wrote about an interesting application of what game theorists call the "Dollar Auction Game", a lesson about escalation. "Business drinking provides a fun subject for strategic thinking...

Criminals Targetting Seniors Jailed

Posted on September 30, 2008
Image via WikipediaFrom the SEC Press Release on a scheme that targeted seniors.The Securities and Exchange Commission announced today that a judge in Riverside County, California, sentenced the last of three men to prison after they were convicted of 522 felony charges in a fraudulent scheme that was the subject of a prior enforcement action brought by the Commission, which raised more than $187 million from over 1,800 victims, mostly senior citizens and the elderly...

Contempt Hearing Ordered for Steven Rodd

Posted on September 30, 2008
Image by Getty Images via DaylifeFrom the SEC Press Release, regarding the LinkTel bizop scam;The Securities and Exchange Commission ("Commission") announced today that an application for an order to show cause why defendant Steven B. Rodd ("Rodd") should not be held in civil contempt was filed by the Commission on September 26, 2008, in the United States District Court for the Northern District of Georgia, based on his failure to pay disgorgement and civil penalties, as directed by the Court's August 30, 2007 order...

Before Buying a Franchise, Don't Trust... Verify

Posted on September 30, 2008
Image by Getty Images via DaylifeSean Kelly, writing at All Business, has a couple of good ideas about franchise pre-purchase investigations.Someone asked Sean about a concept and claimed that the franchise business model was too good to fail. Here is Sean's response: "There's NO concept that's "too good to fail...

Financial Crisis: A Mirror Image of MLM?

Posted on September 30, 2008
Image by Getty Images via DaylifeRobert FitzPatrick has an interesting comparison about our current economic crisis and MLM scams.For those who are asking how our national economy fell into the current financial crisis or how the nation's business leaders could not have seen it coming or how the federal government could have allowed it to happen, a study of multi-level marketing (MLM) - which attracts more than five million Americans each year with its "income opportunity" - can offer answers...

No Love for Bailout?

Posted on September 29, 2008
Image via WikipediaFrom CNN, we learn more about what some investment banks think about the failed bailout."People are very seriously concerned that there's no panacea from legislative action," said Daniel Alpert, managing director of Westwood Capital, a New York-based investment bank...

Affordable Franchise Expert Assistance

Posted on September 29, 2008
Image by . SantiMB . via FlickrRichard Solomon is offering an interesting day long franchise program.Here is part of his program."We talk about the nature and specifics of different kinds of claims and defenses; potential affirmative defenses and counterclaims that your adversary could be expected to assert; the facts you believe are true and how to prove them, as well as how to obtain possession of admissible evidence not yet in your possession...

YTB: One Person's Extended Perspective

Posted on September 29, 2008
Image via WikipediaThis is what I love about the internet. Kevin Horrigan writes about the YTB scandal, from a historical perspective. I am going to republish a great deal of his story, probably overdoing fair use. "There I was, reading Tim Logan's excellent story in Sunday's Post-Dispatch about YTB Internationalwhen a name from the past jumped out at me:  J...

Franchise Shills

Posted on September 29, 2008
Fakes testimonials works simple because they are testimonials, in the same way that canned laughter provokes more laughter even for unfunny jokes.Consider this 123 Fit Franchisee shill"We are having a blast with our 123 Fit location. And we have now proved you can generate positive cash flow with this system...

What Can We Learn From Paul Newman?

Posted on September 27, 2008
Image via WikipediaPaul Newman died last night from cancer.  Newman, along with Robert Redford and Robert Shaw, starred in one of the most popular movies about conmen, The Sting, which was based on David Maurer's book,The Big Con: The Story of the Confidence Man Paul Newman's foundation issued this press release, about luck, randomness and equality...

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