AARP's Due Diligence
The American Association of Retired Persons, who sponsored the Weapons of Fraud book that I highly recommend, also has a checklist designed to avoid Business Opportunities Investment Scams. Let's take a look at some of the recommendations. Recall, that my view is that a) the purchasers of business opportunities need defences and not more information to defeat scams, and b) the collection and utilization of information in a rational and calculating manner has to be done by independent gate keepers. With this is in mind, let's turn to their recommendations.
"Take these steps to make sure the business is legitimate:* Get all earnings claims in writing and be sure the information includes information about other clients who have earned at least as much as the promotion claims.
* Interview references provided by the promoter. Business opportunity promoters are required to give potential purchasers the contact information of at least 10 prior purchasers who live the closest to the potential purchaser.
* Study the business opportunity's franchise disclosure document. Most business opportunity promoters must provide this information to potential purchasers. It will include information about whether the company has faced any lawsuits from prior purchasers or lawsuits alleging fraud
* If the business involves selling products from well-known companies, call the legal department of the company whose merchandise is being promoted. Find out whether the business opportunity and its promoter are affiliated with the company. Ask whether the company has ever threatened trademark action against the business opportunity promoter."
First, this advice appears to be directed to a version of the rational economic man -one who calculates the expected value of a decision before acting. This is simply not the picture we find when dealing with victims of fraud criminals. As Anthony Pratkanis described so well, the fraud criminals flash a phantom dream before their victim precisely to lure him into irrational decision making. We need to identify those tricks, mirages, or illusions which make these phantom seem so suddenly obtainable. Then we need to develop quick and automatic responses to dispel or ward off these illusions. What we don't need to be told is: be more rational. That is like yelling at your children or wife to "JUST CALM DOWN". It just doesn't work.
Technorati Tags: american association of retired persons, investment scams, contact information, business opportunities, business opportunity, gate keepers, promoters, promoter, rational, legitimate, fraud, earnings, weapons
Technorati Tags: american association of retired persons, investment scams, contact information, business opportunities, business opportunity, gate keepers, promoters, promoter, rational, legitimate, fraud, earnings, weapons
