Fraud in Veterans Franchises Targeting Military Veterans

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Protecting Military Veterans from Fraud in Veterans Franchises

Veterans franchises - secrets revealed in how fraud is targeting veterans

Military veterans may be considering veterans franchises consultants due to today’s slow economy and limited job prospects.  The FBI defines franchise churning as a pyramid scheme.  Churning franchises may be targeting military veterans with Veterans Franchises pyramid schemes.

Due to today’s slow economy and limited job prospects, military veterans are considering veterans franchises.  However, many franchises may be churning franchises.  The FBI defines franchise churning as a pyramid scheme.  To protect military veterans from churning franchises, franchisefraud, and pyramid schemes, Jody Whistleblower, of Veterans Franchises Videos, launched new videos to warn military veterans about veterans franchises churning and franchise fraud.

The new Veterans Franchises Videos are unique because they reveal the details of systemic franchise fraud in the franchise industry by publishing secrets associated with franchise fraud and franchise churning, claiming to be Franchise opportunities for veterans.

Jody Whistleblower of Veterans Franchises Videos stated “Military veterans risked their lives to protect freedom.  However, when they return home, there are unscrupulous veterans franchises targeting veterans, claiming to be veteran business opportunities”.  Jody also stated, “The steps to veterans franchise fraud include threats of frivolous lawsuits to coerce the franchisees to sign extortion-like Franchise Termination agreements.  A churning franchise can include a "script" the franchisees must tell future franchise fraud victims, to keep the Franchise Fraud a secret to future veterans franchises victims.  It is not uncommon for a script to force the franchisee to state that the franchisee had a fabulous franchisee experience, when in fact the churning franchise was a financial nightmare.”

 “In addition to a franchise non-disclosure agreement gag order and script, the churning franchise will have in the franchise termination agreement a statement that the franchisees volunteer to outrageous terms that are untrue, such as unpaid future royalties, which were never mentioned in the Franchise Agreement.”  Jody said.

Veterans Franchises Videos mentioned that the franchisees are coerced in the franchise termination process to "volunteer" to transfer the failed franchise, so the franchisor will not have to report it as a failure in the Franchise Disclosure Document, which keeps the failed franchise below the radar of the FTC and future franchise churning victims.

Veterans Franchises Videos calls for reform in the franchise industry by franchisors by

1) Franchisors allowing franchisees freedom to speak of their experience, without disclosing franchisor intellectual property of the business,

2) Urging governments to force franchisors to disclose UNIT operations financials,

3) Stop the use of false “transfers” to hide failed franchisees,

4) Forbid the use of a Federal Trade Commission allowed 20% threshold on the use Confidentiality agreement scripts.

Many people drive by franchise businesses, and might see what appears to be a clean business with a professional marketing appearance.  However, due to the industry use of gag orders, confidentiality agreements, and franchise termination agreement abuse, it is extremely difficult for a prospective franchisee to see if a beautiful marketed, well located franchise is viable, or a churning franchise.  The employees in the franchise unit might be the same year after year, however, the franchisee unit owner might be churned every year, and no one will ever know it due to the use of confidentiality agreements and gag order used throughout the franchise industry.

In the mean time, Veterans Franchises Videos recommends prospective veterans franchisees avoid any Franchise opportunities for veterans due to systemic franchise churning.  If the veteran is extremely motivated to buy a veterans franchise, they absolutely must hire an expert in franchise law to protect them from franchise churning that are targeting veterans franchisees.

For more information, Veterans Franchises Videos recommends that military veterans refer to the following websites:

http://www.youtube.com/watch?v=gJLMvGVUhDU&feature=plcp

http://www.youtube.com/user/VeteransFranchises

http://www.facebook.com/jody.whistleblower

Veterans Franchises: Be Cautious When Pursuing a Franchise Opportunity

 Veterans franchises need to be aware of how franchise fraud is conducted as a process.  

Veterans Franchises

 This great article by Ed Teixeira, the founder and owner of FranchiseKnowHow, explains some things to be careful of when thinking of veterans franchises.

However, franchise fraud is a lot more common than you think in Veterans franchises.

If you are considering a veterans franchise, be aware that the franchise might be a churning franchise, and nothing more than a franchise fraud.  The FBI defines franchise fraud and franchise churning as a pyramid scheme.

Franchise Jokes

Comedy is a great way to deal with pain. These franchise jokes may seem funny, but they are extremely painful if you are a franchisee, or former franchisee, and the bankruptcy joke is on you.

Franchise fraud is no laughing matter.

What’s a shorter way to say “Franchise”? “Fraud.”

What is the accounting department called at a franchisor? Accounts deceivable.

What is the fancy 401K rollover investment called when you roll it into your franchise? Leavenworth.

Franchisee is the future tense of bankrupt.

Being a franchisee provides security for your bankruptcy attorney.

My franchisor found out what I had – and took it!

A franchisor’s lawyer is an expert on justice, just like a hooker is an expert on love.

What’s the difference between a franchisor’s lawyer and a hooker? There are some things a hooker won’t do.

What tax shelter do you get from being a franchisee? Unemployment. Destitute.

What’s the definition of a franchisee? Someone on a three year trip to bankruptcy court (and a rest stop at divorce court). 

Definition of Comedy: when you see the truth in someone else’s pain.

Tragedy: when you see the truth in the pain, and the pain is your pain.

Franchisee: when you see the truth in your financial pain, and your franchisor is laughing at your pain while sailing to their off-shore bank with your life savings, and your name is on the back of their boat.  

In the old days, an investor bought a franchise to make money. Now, a franchisor signs up investors to just get their money.

What is the second best day of a skipper’s life? When they buy a boat. What is the best day of a skipper’s life? When they sell the boat.
What is the second best day of an entrepreneur’s life? When they buy a franchise. What is the best day of an entrepreneur’s life? When they file for bankruptcy a few years later.  

Top ways to invest your money as a franchisee:
8. Avoid franchising!
7. Go in to business yourself, with the most expensive tools, and see #8.
6. Have your spouse get a job, with another franchise.
5. Have your children get a job, with another franchise.
4. Work for a franchise for a year, get paid, enjoy benefits, and see if the franchisee owner is really making money.
3. Pick up coins you find on the sidewalk in front of a franchise.
2. Find money under seat cushions at a franchise, go to a Casino with that money, and get free drinks at the slot machines.
1. Become a franchisor, create a franchise “system” around a dubious product value, brag about your franchise training and franchise marketing materials, blame the franchisee when things don’t work, “gag” failed franchisees with franchise termination confidentiality agreements (with endorsement from the FTC via the Franchise Rule) threats of frivolous lawsuits, stay under the Federal Trade Commission 20% gag order threshold limits, and churn franchisees of their self directed 401K, second mortgage, life savings, dreams, and Hope.  

Top things to do with your money instead of throwing it away on a franchise license:
3. Go to school and get a degree, or job training.
2. Open a similar business across the street from a franchise business opportunity, and wait for the franchise to fail. Because you don’t have to pay onerous monthly royalties to a franchisor, your costs will be lower, and you can undercut the franchisees prices, and drive them out of business. It sucks to be a franchisee!
1. Go spend your life savings on a two year vacation. At least you will enjoy yourself while you burn through your retirement, instead of two years of hell marching toward bankruptcy court (and no vacations).

Franchise Financing – Beware how to finance a franchise with a 401(k).

Beware how to finance a franchise with a 401(k) with Franchise Financing

401K rollover investment in a veterans franchise opportunity Intertanglement

If you are considering investing your life savings, your self-directed 401K, rollover 401K, in to a veterans franchise for franchise financing, BEWARE. Just don’t do it to finance franchise. It’s a recipe for fees, an IRS audit, fines, penalties, bankruptcy, divorce, and enriching your franchisor.


You might hate your job, be over aged and can’t get a job interview because you are overqualified, and the nice franchise broker is reassuring you that you can safely use your self-directed 401K for a “franchising financing”. My experience is: Don’t use your 401(k) for franchise funding. I am telling you from personal, painful experience, that Franchise Churning is a very real business plan for a franchisor.

It is very risky to finance franchises with intertangling your 401K with a franchise that might end up being a franchise churning operation.

Check out the smoking gun proof of this at the link “Franchise termination” I never thought it could happen to me, but it did. I bet my life savings to finance franchise, (my self-directed 401K), into what was thought to be a “proven” franchise concept, only to find out that it was really a franchise scam.

The risks to you of investing your 401K plan for franchise financing in a franchise scam that is: Franchise success rates are a myth; chances are you will lose all the franchise funds you invest in your franchise. We could try to explain it on this website, but the best source is to purchase & read Robert Purvin’s book “The Franchise Fraud”. The book is $18.99, plus shipping, and the best investment in franchising that you can make.

I wished I had known the book existed, let alone read it, before I found out I used my 401(k) for franchise financing in a franchise churning business: http://www.amazon.com/Franchise-Fraud-Protect-Yourself-Before/dp/1419688626/ref=tmm_pap_title_0/179-4743220-2334908

When (not If, but when) you lose your money in the veterans franchise, you will owe the franchise funds money back to your 401K, and the IRS is going to be looking for you.

There are financial organizations that claim to allow you to access retirement accounts without penalty before retirement, such as your self directed 401K. It’s expensive to keep the 401K “finance franchise” structure in place, nearly $1,000 per year, and that will do nothing to protect you when the IRS calls.

Your franchisor will likely have had you sign documents that keep them off the hook, and you total liable for using your 401(k) for franchise financing. In October of 2008, the IRS took notice of the practice of rolling 401K money in to a business for franchising financing. The IRS calls it ROBS, and the acronym tells you something of what they think of the practice of using your 401K for a business opportunity start up, such as risky franchise financing: http://www.irs.gov/pub/irs-tege/rollover_guidelines.pdf

The coming franchise investment bloodbath

A must-read article on the franchise system and franchise financing. If you have a sizable amount of money to invest for franchise funding, and can’t get a job (because you are considered over qualified, too old, wrong sex, wrong race, don’t fit reverse discrimination quotas, etc), you need to read this link before you finance franchise: http://www.franchiseremedies.com/franchise_investment_bloodbath.htm

FDD franchise disclosure document 0/0/0/0/0 page is worthless and misleading

Don’t bet your life savings on the FDD franchise disclosure document 0/0/0/0/0 page!

The following page is contained in a typical FDD franchise disclosure document / UFOC franchise document.

It is required by the FTC for Franchisors to present this page to potential franchisees. When you look through the UFOC franchise, FDD franchise disclosure document, and franchise license agreement, several pages will stand out. These pages will have rows and columns filled with 0/0/0/0/0. An example is below. Licensed Consulting Practice Status Summary FDD franchise disclosure document 0/0/0/0/0 page is worthless and misleading information  

For the period ending December 31, 2010, and years ending 2009,2008, 2007, 2006 Data is displayed corresponding to the years as 2010/09/08/07/06 State Transferred Cancelled Not Renewed Reacquired by Licensor Left the system Total Operating at year end AZ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 8/4/2/1/ AL 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 8/4/2/1/ AR 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 8/4/2/1/ CA 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 8/4/2/1/ CO 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 8/4/2/1/ DE 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 8/4/2/1/ FL 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 8/4/2/1/ GA 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 8/4/2/1/ MA 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 8/4/2/1/ MN 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 8/4/2/1/ MO 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 8/4/2/1/ PA 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/0/0/0/ 8/4/2/1/ WA 1/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/1/0/0/ 0/1/0/0/ 0/1/0/0/ 3/1/1/0/ Total 1/0/0/0/ 0/0/0/0/ 0/0/0/0/ 0/1/0/0/ 0/1/0/0/ 0/1/0/0/ 75/49/25/12

This page in the uniform franchise offering circular UFOC and FDD franchise disclosure document is worthless information!

This worthless page enables a franchise scam!

This data is misleading with a franchisor that is practicing franchise churning!

Franchise churning organizations can present data on these pages by filling in as many 0/0/0/0 as possible to make them look good. Too many 0/0/0/0/0 would be suspicious. Because there is no perfect business, there should be some failures. So, there will be a few, very few rows & columns with a few 1’s and 2 are sprinkled in.

There is no way for you to accurately know if this FDD franchise page is correct.

The franchisor could have 100% failure of each franchisee per year. If the franchisor has 23 franchisees per state, and each one failed year after year, the data should look like 23/23/23/23/23.

However, the use of the FTC approve transfer rules along with FTC approved non-disclosures published in the FTC The Franchise Rule allows the churning franchise to present the data as 0/0/0/0/0.

You are betting your life saving on this completely misrepresented data in the FDD franchise disclosure document.  

Buy “The Franchise Fraud” by Robert Purvin, Jr. http://lesstewart.wordpress.com/2008/08/11/the-franchise-fraud-by-robert-purvin/

Amazon link: http://www.amazon.com/gp/product/B00571BHXG/ref=pd_lpo_k2_dp_sr_2/177-1935371-1975961?pf_rd_m=ATVPDKIKX0DER&pf_rd_s=lpo-top-stripe-1&pf_rd_r=1GBFPXGHQRZXWZ5N3AF6&pf_rd_t=201&pf_rd_p=486539851&pf_rd_i=0471599476

veterans franchise program | veteran franchises | franchising for veterans

Beware of veterans franchise programs!

This website cost a franchise fraud victim their life savings. Don’t have this happen to you through a veterans franchise program!

This franchising for veterans fraud warning website exists to warn you from sailing your financial ship upon the treacherous rocks of franchise churning.

As stated in the book “The Franchise Fraud”, veteran franchises don’t have a chance.

The FTC will not help you.

You will be broke from trying to make the franchise business work, and there will not be any lawyers willing to take on your franchise fraud claim as a contingency case. Like other failed franchisees, you try to salvage what you can financially and quietly row your boat on to another life.

If you do more research, you learn that Franchise Fraud has been around for 20 or 30 years, and the franchisors have the money to retain lawyers, and hire lobbyist to keep the law on their side.

You can read the FTC The Franchise Rule, and see how much the FTC knows about franchise gag orders and franchise confidentiality clauses in the franchise industry, but does nothing about the franchise scams.

This franchise fraud victim recommends to potential victims of veterans franchise program: Go in to business for yourself, and avoid franchising!

If you still feel a need to try franchising, read the book The Franchise Fraud. If, after reading The Franchise Fraud, you found a gem of a franchising for veterans business you can’t stop thinking about, have the AAFD (American Association of Franchise Dealers) review it.

Otherwise, the day you sign your franchise agreement papers, you might as well be presigning your bankruptcy papers.

This franchise fraud victim recommends you avoid any veterans franchise program until it is regulated like stocks are by the SEC. The SEC disclosure requirements of a business would give you much more disclosure as to the true viability if a franchise, and reveal if it is in fact a churning franchise.

Don’t throw your financial life away to veteran franchises!

Beware of Veterans Franchises

Beware! Marketing of veterans franchise & veteran business opportunities

A discount on a veterans franchise scam is still a franchise scam.

The day you sign a franchise agreement as a new veterans franchise, you could be signing your future bankruptcy papers.

If you are a military veteran, seeking a new civilian career, there may be veteran business opportunities claiming to be veterans franchise systems, which are actually franchise scams.

There are franchise scams and franchise churning businesses that are claiming to be veteran business opportunities. These franchise scams have slick looking websites, and marketing materials, but in reality are franchise rip offs that practice Franchise Fraud and Franchise Churning.

Search the internet for a veterans franchise, and there are a number of websites that claim to help with franchises for veterans.

The reality is that is it virtually impossible for anyone to determine if the opportunity is actually practicing franchise fraud. Franchise Rip Offs can follow the money.

The easy mortgages of the 1990's made it easy for home equity loans to finance a franchise, and because of the access to this easy money, franchise scams targeted individuals with home equity.

When the home equity market dried up, the Franchise Scams followed the money to the 401K investment market. Many people had sizable 401K’s, and the Franchise pyramid schemes targeted people with 401K’s.

The IRS clamped down on using 401K’s, so it appears the franchise scam industry is following the money to people who have access to money that could be applied to a franchise scheme.

Veterans franchise programs appear to assist veterans, but can be nothing more than a “discount program” to lure unwary veterans into a franchise fraud. Veteran business opportunities mention financial incentives, but in reality all the veteran franchise offers is a discount.

The Franchise Scam needs people to join the franchise churning program for cash flow reasons, just like a normal business needs to offer a discount in order to maintain cash flow to stay in business.

If one reads the specifics of Veterans franchise programs, veteran business opportunities programs are nothing more than a voluntary effort by some franchisors that is designed to encourage veterans franchise ownership through offering financial discounts to veterans. That’s it.

Veterans franchise programs are nothing more than discounts.

A discount on a franchise scam is still a franchise scam.

If you are a military veteran considering a veterans franchise program, please be aware that many veteran business opportunities are nothing more than franchise fraud.

You must invest in a copy of the book “The Franchise Fraud” by Robert Purvin. And Read it; don’t just put it on a shelf and think you did. http://www.amazon.com/Franchise-Fraud-Protect-Yourself-Before/dp/0471599476

Check out the knowledge of gag order and non-disclosure "agreement" using by the franchise industry in FTC The Franchise Rule.