Took a Risk and Lost ---Quiznos

Yes! How disgusting! Quiznos investors took an unknown risk and lost.

They were impressed with the visibility of Quiznos and didn't understand that the UFOC's together with the Contracts are designed to obscure the actual statistical risk of the investment in Quiznos. It is one thing to advise an investor that there is risk and no guarantee of success in the investment in the UFOC and the Contract and quite another thing to obscure the actual franchisor-known statistics as to the success and failure rate of first-generatikon franchisees.

Franchisees wouldn't have believed that government permits franchisors to sell franchises who have a very high risk of failure of first-generation franchisees and that these failures are obscured in the UFOC. Franchisees wou;dn't believe that the promulgation of the law surrounding franchising protects this ugly status quo.

The SBA Franchise Registry is proof of the government's position in that there are many franchises with very high failure rates on the Registry that are eligible for guaranteed SBA Loans. Franchise startups and capital are often backed by home-equity loans and you can know that the failure of first-generation franchisees contributes to the crisis in the mortgage market when franchisees lose their investments and are thrown into bankruptcy. This failure rate of home-equity-franchise loans does not show up on the SBA Loan Default List, of course, so the default rate of SBA loans is not a true picture of the failure rate of the franchise that is being sold.

Fran Data, who manages the SBA Registry for the government under contract and who also sells Risk Profiles to the public for profit may have been putting out misleading risk profiles to the public if they didn't carefully examine each and every transfer that is listed in the franchisor's UFOC. Fran Data acknowledges that the default rate on the SBA loans is material to the risk of investment in the franchise.

It would seem that the banks would want to know the actual failure rate of the first-generation franchisees who borrow against their hnomes and their 401's and their 403's because, of course, the bottom could fall out of the housing market and house re-sale prices could fall drastically.

This is a national disgrace. Greed and deception are not always good and there is a price to be paid for government policies that depend upon the capture of cheap labor and cheap venture capital from uninformed citizens who don't understand that the UFOC's are just a licence to operate in the state, and a license to steal for those predator franchisors who will steal to sustain THEIR visibility and profits.