The AAFD is a national non-profit trade association dedicated to defining and promoting best franchise practices.
[3] Franchise fraud is defined by the United States Federal Bureau of Investigation as a pyramid scheme.
[4] The success of the franchising format of small business ownership has led to a significant imbalance in the relative bargaining power of franchisors and franchisees.
The modern franchisee may be merely a license to operate the business on behalf of the franchisor for the term of the franchise.
The gag order will help prevent prospective new franchisees learning important details about the churning franchise.