Universal Advertising, Inc. – Project Fal$e Hope$
The Federal Trade Commission and the U.S. Department of Justice have filed suit against a Centerville, Utah company (Universal Advertising, Inc.) accusing the company of making false claims to entice franchisees to buy into the business.
The suit alleges Universal has violated the Franchise Rule that requires franchisers to have a reasonable basis for earnings claims, to provide complete and accurate financial information to potential buyers and to disclose the number of prior purchasers who achieved the same or better results as touted in promotional material.
The franchise (Universal) provides, for a minimum of $3,995, a display rack to the franchisee, which holds business cards and pamphlets. The franchisee then finds suitable areas (such as restaurants, hair salons, etc.) to place the display racks. The franchisee then charges rent to businesses to display the business cards and brochures within the display rack.
Unclear in this article is why people actually believed they needed to pay Universal $3,995 for a display rack they certainly could have found at Wal-Mart for $100.
The FTC has labled this crackdown on home-based businesses “Project Fal$e Hope$.”