Bill targets get-rich-quick scams

Posted: Sunday, April 21, 2002

JUNEAU (AP) -- Get-rich-quick scams might be harder to pull off in Alaska under a bill that passed the House on Friday.

The measure would require people selling business opportunities to register with the state and disclose more information to potential customers.

The bill's sponsor, Rep. Gary Stevens, R-Kodiak, said he introduced the measure at the request of the Department of Law.

It's aimed at companies that try to entice people to put up money for a chance to make much more money on nonexistent or unrealistic business ventures.

''What they say is you can earn thousands of dollars part-time at home,'' Stevens said. ''Some of these may be legitimate, but many certainly are not.''

House Bill 393 would require people to register with the state 30 days before offering to sell a business opportunity.

It someone failed to register before conducting a seminar or otherwise advertising a business scheme, the state could shut the operation down.

''It will allow the Department of Law to take preventive action before consumers are scammed,'' Stevens said.

Those selling business opportunities would also have to provide a potential buyer with a variety of information, including a history of lawsuits, criminal charges and consumer complaints brought against the firm.

Buyers of business opportunities would have 30 days to cancel a contract. The money they put up for a venture would go into an escrow account until they received any equipment, supplies and so forth called for in a contract.

Stevens said about half the states in the nation have such laws on the books.

The bill passed 37-1, with Rep. Vic Kohring, R-Wasilla, voting no.

The measure now goes to the Senate.

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