Friend wants to open a business (IBO) in my name for $500/mo

[dogheaded]

Does anyone have any input as to the risks involved?

Here is our conversation from earlier today (F is him):

F: What up
F: Know anyone that wants to make extra $500/mo
F: I need IBO signers for our products
F: Basically i need processing capabilities from other businesses

Me: So signatories for credit accounts?

F: We would open a business in their name (Independent Business Owner IBO). And would process some of our transactions through there. The actual person doesn’t have to do anything except open a business bank acct. everything else is taken care of and we ship $500/mo for about 1-2 years.

Me: What's the business? Why do you need IBOs? Risk? Who am I working with/for? Contract? Why not a percentage of gross vs. a flat $500?

F: Lol that is not this

Me: You would still be utilizing our credit though, right?

F: $500 is the going rate for this which is why it’s $500. I don’t use your credit

Me: What's the risk Worst case scenario

F: None. Worst case scenario you can’t process for a similar product of your own for a few years. Which you 99.9% will not have a product like this. I wasn’t asking you directly tho. Was asking if you had friends. You can do it tho if you want

Me: Well if I'm going to rope friends in to something, I want to know what the risks are. Rather not destroy a friend network

Me: And would there be a contract and who would be the partner in the contract on your end?

F: Yea there’s a contract, I am the contact

Me: So you are the other party on the contract, as an individual? Or a business owned by you?

F: Another business but my personal business
Going for a run. Post any questions here

Me: What's the product?

F: In home women’s laser hair removal

 

[613jono]

@dogheaded Fuck.no. If those accounts charge back on you because the product they sell is bullshit or any number of reasons all that money is on you. Don't fucking do it.

 

[613jono]

@dogheaded And if you get flagged for some reason. Like if that company is kinda dirty. You'll never be able to own a business again in your life or atleast be able to run credit cards for your business.

 

[613jono]

@dogheaded Why would you even ask this. Definitely a bad idea. If your friend does this to anyone, it’s probably a good idea to report them to the FTC and cut ties. Honestly sounds like a pyramid scheme

 

[imingtown]

@dogheaded Don't do it, too shady

 

[keepwalking]

@dogheaded How could this sound more like a scam? It is like the perfect scam script.

 

[fidelibus]

@dogheaded Good grief, no way!

 

[bluegoose]

@dogheaded I believe that you use the term 'friend' rather loosely.

 

[dogheaded]

Thanks for the responses.. this is why I love Reddit. Prevents me from doing stupid shit.

 

[jrminoh]

@dogheaded I just don't see the benefit of letting someone else open a business in your name. All the issues and legalization that cloud arise would fall onto you...

This is like saying I want to buy a car, but it will be under your name so when I crash your car, get a ticket, and stop paying - it will be on you

I don't know what IBO is, but it sounds odd. Maybe someone here knows more about it.

also this person's approach to ask about friends is a common sales tactic, so I would not buy that baloney haha