PHOENIX (Tuesday, April 10, 2012) -- Attorney General Tom Horne says a newly-signed state law will offer seniors more protection from a proliferating number of new telephone solicitation scams. Consumers have lost millions of dollars to con artists who promise to establish work-at-home businesses promising consumers substantial incomes. When the money does not materialize, consumers are left with empty bank accounts or large credit card bills.
“Consumers who are thinking about buying any type of business should be given sufficient information to make an informed decision as well as enough time to review the information. Legitimate businesses are willing to give potential purchasers a full description of their program, including the products involved, the cost to consumers and a proper notice of cancellation,” said Horne. “Unfortunately, scam artists take advantage of some consumers, costing Arizonans millions of dollars every year. This new law will be a valuable tool for prosecuting these criminal predators.”
Under the new law, any company or individual that sells business opportunities or any advertising or other services associated with business opportunities must:
- file an annual registration with the Arizona Secretary of State that identifies the principals of the business and provides their previous history in this industry;
- maintain a $100,000 bond with the Arizona State Treasurer, proceeds of which would be payable to consumers who are defrauded by the seller;
- provide specific, written disclosures to potential purchasers before a business opportunity is sold;
- give each consumer-purchaser a written contract; and
- provide consumers with a ten day “cooling off” period after the contract is signed.
The Attorney General’s Office actively prosecutes these cases on a continuing basis. To further protect consumers from this type of fraud, Attorney General Horne advocated for legislation to regulate the sale of business opportunities. The bill was supported by the Taskforce Against Senior Abuse (TASA), a taskforce organized by Attorney General Horne to combat abuse of Arizona’s senior population due to the large number of elders targeted by the these types of companies. Representative Kate Brophy-McGee, sponsored the bill and is a member of the TASA Advisory Council.
Attorney General Horne advises any consumer interested in purchasing a business opportunity to make sure the seller has complied with the new law. Consumers who are not provided with the required information should file a complaint with the Attorney General’s Office. To file a consumer complaint, please contact the Arizona Attorney General’s Office Consumer Information & Complaints Unit at (602) 542-5763 / (520) 628-6504 / (800) 352-8431.
- Link to bill: http://www.azleg.gov/legtext/50leg/2r/laws/0186.pdf
- Link to fact sheet: http://www.azleg.gov/legtext/50leg/2r/summary/s.2825ce_caucus-floor.pdf