Frank Prochilo, Legal Tips and Strategies for Online Marketers

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00:00
welcome to funnel hacker radio podcast
00:03
where we go behind the scenes and
00:05
uncover the tactics and strategies top
00:07
entrepreneurs are using to make more
00:09
sales dominate their markets and how you
00:12
can get those same results here is your
00:14
host dave woodward hey everybody welcome
00:18
back to funnel hacker radio i’m your
00:19
host dave would work today you’re going
00:21
to love this opportunity because we have
00:23
the opportunity back to have a drink for
00:24
chili on the phone with us break
00:26
actually is an attorney and this is a
00:28
guy you would think i would normally
00:30
never have on a podcast dealing with
00:33
funnels but I met break a couple weeks
00:35
ago and thought you know what he’s got
00:37
such amazing content for small business
00:39
owners he specializes in working with
00:41
online business owners primarily
00:43
protecting them against FTC and I
00:45
thought man we’ve got people are doing a
00:47
ton of transaction multi-million dollars
00:49
through photos online I thought having
00:52
Frank on would be just an amazing
00:53
opportunity so Frank welcome to the call
00:56
Dave thanks for having me again I really
01:00
really appreciate you taking the time to
01:01
do this this is going to be really a lot
01:03
of fun and I promise everybody will keep
01:05
this real entertaining in life but it’s
01:07
a topic that a lot of people screw up
01:10
and so I wanted to make sure I think
01:12
where does actually came about that I
01:14
think we were at launch con together but
01:15
we whether just a couple weeks over yeah
01:17
yeah we met via the booth right outside
01:21
it was funny because I literally just
01:23
gotten a phone call from a good buddy of
01:25
mine because I Dave listen I’m in a
01:27
situation with a a JV partner it’s not
01:31
going well you have anybody you could
01:32
refer me to and I was literally just
01:34
talking to Frank I said you know what
01:35
the guys get it right in front of me and
01:37
so after that I thought we need to make
01:39
sure that more people have access to
01:41
Frank and what he’s got going so I want
01:43
to really kind of just dive in and Frank
01:45
if you don’t mind take just a few
01:46
minutes here real quick and help people
01:48
understand what what are the some of the
01:50
things as an online business owner
01:52
legally they need to be looking at right
01:55
whoops this is just a quick little
01:57
background so the main the being
02:00
government agency that’s going to be
02:02
regulating all this is called the FTC
02:04
for the Federal Trade Commission and
02:06
they’re the main consumer protection
02:09
agency of US government I’m going to try
02:12
to keep this
02:13
as fun as possible and try board down by
02:18
the legal terms so stop me if I if I get
02:20
a little bit lawyerly loyally but
02:25
essentially what what they’re looking
02:27
for is truth in advertising and that can
02:30
go anywhere from the claims that you
02:32
make in your sales letters to of
02:35
advertising properly that you have
02:37
recurring billing cycles I know a lot of
02:39
us like to have like that monthly or
02:42
yearly subscription service and also
02:47
just making sure you have proper privacy
02:49
policies and disclaimers and we’ll talk
02:50
about some some high-profile cases with
02:53
some people and companies that we all
02:55
know about that kind of gotten sticky
02:57
situations so there’s there’s really a
02:59
lot and way more than we could ever go
03:01
through in this conversation but I’m
03:03
going to try to just focus on the main
03:05
things so so the first thing that I
03:08
think that we should talk about our just
03:10
disclaimers and this just is really goes
03:13
to the the advert the claims you make in
03:15
advertising we all want our sales
03:17
letters to be as compelling as possible
03:20
so that our buyers will be in tells you
03:24
to call to action click on the link and
03:27
make a purchase and so we’ll talk about
03:30
claims and the benefits of our products
03:32
and a lot of us will use testimonials
03:35
but what’s important to note is that
03:38
first and foremost if you’re going to
03:40
use testimonials and it isn’t
03:43
representative it’s more of a an
03:45
atypical or someone who really excelled
03:47
at your product that’s making that or
03:49
consult using your service that’s making
03:51
that claim you want to you want to make
03:54
sure that there’s some sort of
03:55
disclaimer saying either in the ad page
03:58
like this is someone who really took
04:00
this mentality and ran with it rather
04:01
than you’re automatically guaranteed to
04:03
get these these results do you know what
04:05
I mean that makes complete sense yeah um
04:10
another thing I mean this is something
04:13
that came up when I was actually talking
04:14
to your friend is is uh having those
04:17
recurring billing themes when you’re
04:20
going to have recurring billing you need
04:22
to make that as obvious to the customer
04:26
as possible I think one of the issues
04:29
that a lot of people ran ran into was
04:31
they didn’t advertise up front that it
04:36
was a recurring billing it was a monthly
04:39
or a yearly subscription and the
04:41
consumers only found out after they made
04:44
the purchase or sometimes not until they
04:45
got billed again this is actually that’s
04:48
actually illegal and if you get caught
04:50
doing that you will face massive fines I
04:53
think the minimum fine by the FTC if
04:56
you’re found guilty of a violation is
04:58
about sixteen thousand dollars so
05:01
already it’s far more money than the
05:04
cost of having someone look over your
05:05
stuff so what is this what are the main
05:10
things that person needs to be I mean
05:13
obviously we always talk about
05:14
testimonials and stuff the Jordan most
05:18
people’s testimonials usually those
05:19
people who actually ended up using the
05:21
product and had success where it is a
05:23
huge caveat to actually making extension
05:26
with any product that you use but I mean
05:29
if they have success from it what what
05:31
separates them from being an anomaly
05:34
versus just listen if anybody goes
05:36
through and they actually implement
05:37
everything I say they’re going to get
05:38
this guy result yes yeah that’s why for
05:41
tough thing and you even for us lawyers
05:43
it’s always a case-by-case thing so the
05:47
advice or quote the information I’m
05:49
giving here if you’re not going to have
05:52
a lawyer look over everything and you
05:54
want to use your best judgment so we all
05:57
we all know more about our products than
05:59
anybody else and we know what results to
06:01
expect and we use the best testimonials
06:04
that we get and the you don’t have to
06:07
say that this person got great results
06:10
of my product but you shouldn’t expect
06:14
it that you don’t have to do that you
06:15
don’t have this sort of self-sabotage
06:17
what you should say is something wrong
06:20
along the lines of this person dedicated
06:23
themselves to using the product they
06:26
followed it step by step and this is the
06:28
results that they got and I know I know
06:32
that’s kind of you know splitting hairs
06:33
a little bit but just just really to
06:36
give you an idea of of what the
06:39
FTC is looking at when they’re examining
06:42
your advertisements what one of the
06:45
other things to keep in mind is this is
06:47
all relatively new territory up until
06:50
recently the Federal Trade Commission
06:53
wasn’t really cracking down on the small
06:55
guys like if you if you’re only doing
06:57
six figures or low seven figures per
07:00
year the FTC wasn’t too concerned with
07:01
you but due to the recent boom in
07:04
Internet activity so many people
07:07
starting online businesses they’ve
07:09
really taken a new and pretty unique
07:11
approach to it anyone who who advertises
07:15
using fake facebook advertising will
07:17
kind of know what I mean when I talk
07:21
about the FTC using lookalike audiences
07:23
to crack down and what that means is
07:26
they’ll find someone who is big in their
07:30
industry or in their niche who is
07:34
engaging in practices that are against
07:38
the law or against the rules and
07:40
regulations set forth by the FTC and
07:43
then what they’ll do is they’ll go
07:46
deeper into that niche they’ll basically
07:48
do what internet marketers do to find
07:50
their own niche and that is don’t go
07:52
deeper and they’ll find people who are
07:54
similar to this one person and they’ll
07:57
drag them all into a lawsuit and the
07:59
worst thing that could ever happen to
08:00
your business especially if you just
08:02
starting out is this to get dragged into
08:04
a lawsuit with the FTC so what are the
08:08
steps that somebody needs to do to avoid
08:10
that and what I mean no one wants to get
08:12
involved in that obviously at the same
08:14
time as marketers we tend to push things
08:17
not black and white but maybe someone
08:20
little grayish at times or at least I
08:23
mean I know from our standpoint at
08:25
clickfunnels amazing we get hit up with
08:28
a lot biz you know people said all
08:29
someone it’s a copyright infringement
08:31
they can’t use my name they can’t use my
08:33
pictures on their funnel or when we I
08:35
get a lot of that kind of stuff coming
08:37
in but I’m always curing the horse
08:38
what’s the FTC really most concerned
08:41
about is it is it claims is it duh I
08:45
mean it’s a primarily claims that the
08:47
the main thing you’re looking at what
08:48
other things are they most concerned
08:50
about well believe it or not the FCC is
08:53
it’s a complaint driven organization so
08:57
your best bet to avoiding any
09:00
interaction with the FTC is having
09:01
absolutely outstanding customer service
09:03
the way the way that they find a lot of
09:06
people come and and the reason why the
09:09
biggest people are the ones who get
09:11
caught first is because they are the
09:13
biggest in gender and tend to generate
09:15
the most complaints so more complaints
09:18
that you have up against you the more
09:21
likely the FTC is to investigate you and
09:25
you know can we will interrupt you real
09:27
quick here because we literally that’s
09:29
the one thing I can say is it it Bob’s
09:32
we’re not the FTC but it’s interesting
09:34
for me if there’s a complaint that we
09:37
get from customers who end up calling us
09:39
is because the funnel that they bought
09:42
through has no customer service so then
09:45
they see our little clickfunnels badge
09:46
at the bottom and I think it’s us that’s
09:49
their kind of our services so they
09:50
contact us so I can’t express the
09:52
importance of making sure that when
09:54
you’re selling a product you need to
09:56
have some way for your customers to
09:57
respond to you in some way I don’t care
09:59
it doesn’t need to get phone phone
10:00
number but you have to at least have
10:02
email support or something where a
10:04
person can get ahold of you I think
10:06
that’s really a great comment I
10:08
appreciate you mention her yeah and not
10:10
only having it but but having it cut
10:13
responding in a timely manner you know
10:18
there I am we’ve all dealt with terrible
10:20
customer service before we’ve also hold
10:23
dealt with great customer service I mean
10:24
I just had a customer for another one of
10:29
my business send us in a request saying
10:32
that they didn’t mean to purchase the
10:33
product or they didn’t want it or
10:35
whatever it was and within an hour we
10:38
had a response out there we had a full
10:40
refund given and we said keep the
10:43
product anyway and our goal because
10:46
because we know we want to keep the
10:48
complaints ways to make them as happy as
10:50
possible doesn’t so don’t give everybody
10:53
an excuse to file a complaint against
10:55
you because because only bad things will
10:58
happen to it that that’s number one
11:02
number two is if you get big enough
11:05
people will make complaints anyway
11:07
that’s just the cost of doing business
11:08
as you continue to grow and I guess now
11:12
would be a good time to talk about the
11:14
high-profile cases because because I
11:18
think that that really hammers down the
11:20
point and you can take away some things
11:22
that that those people did or didn’t do
11:25
that you can kind of implement into your
11:28
own business the first person is a frank
11:33
kern and i’m sure most people involved
11:35
in internet marketing have at least
11:36
heard of Frank Kern he was he was
11:40
student 2003 and he writes all about it
11:42
he has a blog post he’s just Google
11:44
franker and what it’s like to get sued
11:46
by the FTC and he’ll give it you from
11:49
his experience as an internet marketing
11:51
what it was like for going what was like
11:53
going through it for for him basically
11:56
what he was doing in that situation was
11:58
he was he bought a bunch of books in
12:01
which he had the resale rights to and he
12:04
bundled all these books together and
12:05
sold them as package I think was called
12:07
internet marketing Empire or something
12:09
like that when you bought these bundles
12:13
from him you also purchase to resell
12:15
rights and the rights to use a sales
12:17
letter that he used that had his name of
12:19
it now this kind of shady company
12:22
started using his information and they
12:25
were harassing people called and
12:26
offering coaching services and saying
12:28
that they worked with Frank current even
12:30
though they didn’t they were end up
12:31
getting a ton of complaints and the FTC
12:35
filed suit against Frank Erne and not
12:37
this other company because they kept
12:39
using his name and so even though Frank
12:45
wasn’t involved in that at all other
12:47
than the fact that he sold it he still
12:48
wound up getting dragged in to this
12:50
lawsuit and you go out up spending over
12:53
a hundred thousand dollars in legal fees
12:55
and he thought he originally thought
12:58
that he was protected because he had his
13:00
family’s tax lawyer look over his
13:02
website now there are a million
13:07
different kinds of lawyers for a reason
13:08
there’s too much of the law for any one
13:10
attorney to know that so the first
13:12
lesson to take away there is if you are
13:14
going to hire an attorney make sure it’s
13:15
an experience internet attorney and the
13:19
second thing to take away is that
13:21
it drives home the point that the FTC
13:23
really is a complete driven company
13:26
because they had all these complaints
13:27
against this other company that was
13:30
using Frank currents name but they still
13:31
sued Frank Kern and not the other
13:33
company now Frank was really big at the
13:36
time so he was able to withstand it for
13:39
a lot of us it would crush us the second
13:44
crazy yeah the second thing brings me to
13:48
the point of privacy policies and and
13:50
there was a snapchat recently just had a
13:53
settlement with the FTC which is why
13:54
it’s on my mind snapchat as we all know
13:58
is you send a picture and it’s
14:00
supposedly deleted forever after a
14:01
certain period of time snapchat had this
14:04
privacy policy on their page essentially
14:07
saying that the problem was was that the
14:12
snaps weren’t actually deleted there
14:16
were ways that hackers could come in and
14:17
retrieve people snaps them think there
14:20
was that whole scandal you know about a
14:22
year or so ago with the nude pictures of
14:25
celebrities being released and a lot of
14:27
those were taken off of other people’s
14:29
phones or snapchat or stuff like that so
14:34
a lot most people think oh I have a
14:37
privacy policy and as long as the
14:39
privacy policy is in place I I’m
14:41
protected I can’t get sued the
14:44
complaints will have no weight against
14:45
me that’s true you would explain the
14:48
real truth of the matter is is you can
14:50
have a privacy policy but if it doesn’t
14:51
do exactly what you say it’s supposed to
14:53
do then that puts you on the hook so
14:57
snapchat and I’ll try to also to word
15:02
this a little bit differently to to show
15:04
you what I mean but there are things
15:07
that you could not be liable for but you
15:11
are because you decided to put that in
15:12
your privacy policy you know and I mean
15:16
like nobody ever expected pictures to be
15:19
deleted until snapchat invented that
15:21
service but once they said that I think
15:25
once they said if your pictures are
15:27
deleted then they have an obligation so
15:30
the customer to do what they say we’re
15:32
going to do and when that wound up
15:34
popteen they say
15:35
yes he sets it and sued them they wound
15:37
up settling for I think it was
15:39
undisclosed what I’m hearing it’s rumors
15:41
of you know in the hundreds of thousands
15:43
of dollars plus who knows how much money
15:46
they had to spend on lawyers if you are
15:48
using privacy policies make sure you do
15:52
what your policy say so look over them
15:54
or have an attorney go look over your
15:56
privacy policy make sure it’s accurate
15:57
because if your privacy policy isn’t
15:59
accurate if you don’t follow it to the
16:01
exact key of what it so you’re going to
16:03
do then you’re opening up a can of worms
16:05
yourself well house how much the privacy
16:08
policy cost and where people get them
16:10
because I could date I’ve seen a ton of
16:12
people literally just go in and and copy
16:15
and swipe someone else’s privacy policy
16:17
and then do a quick word search change
16:20
out the names and call it good i mean
16:21
what yeah how long does it galbi does
16:25
obviously it really main thing snapchat
16:27
has got the suit for brought into the
16:30
case was they introduce a term basically
16:32
no one else has ever done before so are
16:34
you better off having less stuff or more
16:36
stuff or how’s that work well this is a
16:39
an answer that most people will probably
16:41
hate but the answer is that it really
16:43
depends it depends on on the business
16:46
that you’re doing and what guarantees
16:49
you want to make to your customers
16:50
sometimes the privacy policy is the
16:53
whole basis of your business just like
16:54
it was with snapchat if you think about
16:56
it the whole basis of their business is
16:58
that the snaps disappear after a certain
17:00
amount of time so there are there are
17:03
guarantees that every business wants to
17:05
be able to make to their customers and I
17:08
if you if you can if you can afford an
17:12
attorney then i would go find an
17:15
attorney your posture couple thousand
17:18
dollars but a few thousand dollars is a
17:21
lot less than a few hundred thousand
17:22
dollars in the long term especially if
17:24
you really intend on growing your
17:25
business so for that for that clock so
17:29
that specific question i would say your
17:31
best bet is to consult an attorney there
17:33
are countries out there yeah there are
17:35
companies out there that are in the
17:38
process of creating some products i am
17:41
one of those people we are working on
17:44
creating a sort of blueprints of
17:47
language that you can use
17:49
if you’re just starting out and you want
17:52
to avoid the cost of an attorney sort of
17:55
like a placeholder and so you can grow
17:56
your business to a different size and uh
18:00
if ever when that comes to fruition i’ll
18:03
try to make you cook funnel community
18:05
aware of that but right now it’s weirder
18:08
than sort of the research and creation
18:10
mode of trying to find some language
18:12
that can generally fit most businesses
18:14
exact and say most people are me to
18:17
spend a couple thousand dollars on an
18:18
attorney until it’s probably too late
18:20
except just look like i know the
18:23
community to well i know most people
18:25
when they’re getting started it business
18:26
or like at least of my concerns is the
18:28
privacy policy in terms of service so
18:30
let’s worry about that later so I don’t
18:33
know first the old adage is an ounce of
18:37
prevention is worth a pound of your life
18:41
times when it comes to the law that is
18:43
over incredibly true because you have to
18:46
start paying litigation attorneys or
18:48
they start charging you a 400 500 bucks
18:50
an hour then you know then it’s in your
18:55
you’re in deep trouble so what are the
18:58
other things people need to be aware of
18:59
their starting a business online um but
19:08
all right actually what you go back to
19:11
us to choose an advertising because I
19:13
really do think that’s the most
19:15
important thing for people we talk to
19:17
artists lemurs a little bit players a
19:19
little bit more to it there’s a company
19:22
that I was just reading about called the
19:23
hype at Highbury they’re promoting to
19:27
lose 50 pounds and in four weeks and you
19:32
know they had all this Wallace language
19:34
up saying that this this certain product
19:39
is created for weight loss and you can
19:41
lose this much money in this amount of
19:42
time the whole thing turned out to be a
19:45
whole lot of crap and they had this
19:50
disclaimer on their page that said don’t
19:52
expect these results they’re not typical
19:55
and they thought that that would protect
19:57
them well the problem was
20:00
you can’t do that that’s not how the
20:03
Screamers work so if anyone out there is
20:05
thinking about using disclaimers to sort
20:07
of take a shortcut around the law that’s
20:10
not how they work and can’t I can’t do
20:14
that so you can’t make ridiculous claims
20:17
and then say well not really in your
20:19
disclaimer if issue for example oh I
20:27
have the the FTC language in front of me
20:31
and I’ll try to break it down into the
20:32
layman’s layman’s terms give you a
20:34
better idea I see you as an advertiser
20:37
you’re responsible for ensuring that
20:40
every claim that you make that is either
20:42
expressly made as when you say it
20:44
directly or implied that would lead a
20:48
reasonable consumer to believe that it
20:51
was truthful and a substantiating claim
20:54
you have to be able to back that up
20:56
we’ve all come across tons of ads that’s
21:00
four products would say they’re going to
21:02
do something that they don’t really do
21:03
and these companies you know sometimes
21:07
they fly under the radar but everything
21:09
that you say that your products going to
21:10
do it better do or you better have some
21:13
evidence to back up that it can do that
21:15
if you put it to the test because just
21:18
throwing in that disclaimer saying well
21:19
not really it doesn’t really work like
21:21
that it doesn’t work it doesn’t doesn’t
21:24
fly with the FTC so anything that
21:30
anything that might be considered
21:32
misleading even even if you just think
21:35
about jewelry for a second jewelers are
21:38
actually forced it’s actually you
21:41
wouldn’t think of it as a disclaimer but
21:43
it is if they say it’s imitation pearl
21:46
let’s say you buy a pearl necklace with
21:48
imitation pearl invitation is actually
21:50
the disclaimer and so they say they’re
21:52
selling pearls but imitation that this
21:54
is the disclaimer problems and another
22:02
thing about where you want to put your
22:04
disclaimers and you want to put them
22:08
close to the edge so we talked I talked
22:12
about how a pearl could be the trigger
22:14
invitation would be the disclaimer if
22:17
you’re having testimonials and you feel
22:19
like you want to put a disclaimer to
22:22
that testimonial saying this is someone
22:24
who really did an exceptionally well job
22:26
with the program you can just put a
22:28
little asterisk right next to it saying
22:30
this is someone who did an exceptional
22:31
job with the program and you want it to
22:32
be close disclaimer two pages away
22:35
probably wouldn’t have sufficient that
22:41
make sense yeah well Frank I appreciate
22:45
this contents been fantastic and I
22:47
really appreciate it yeah I know it’s
22:49
one of those things no one really wants
22:50
to pay attenti to kind of like what
22:52
you’re mentioning our as prevention vs
22:56
vs actually it trying to send it later
22:59
and I think as we kind of gets it close
23:01
to wrapping things up there I know one
23:03
of the main things people ever want to
23:04
find out is how do they get more
23:07
information on something like this and
23:08
what’s the easiest way of reaching out
23:10
to you so if they want to do that how
23:12
they get a hold of you all right well I
23:15
think anyone here in the funnel hacker
23:18
community I am a fellow hacker myself
23:21
somewhat actor to answer questions you
23:23
can reach out to me via my email and
23:26
that email is s as in Frank J as in
23:30
Joseph P as in Peter e SQ has in the
23:36
shorthand for Esquire so that’s SJP es q
23:41
@ gmail.com and brings that more awesome
23:46
yeah and I do have a disclaimer of my
23:48
own that I am legally required to add to
23:52
this conversation you’re at County
23:57
Matthew yeah yeah exactly i actually
24:00
probably should have said in the
24:01
beginning of this conversation but we
24:03
set it out now so as Dave said I’m an
24:06
attorney and I do specialize in this
24:07
stuff however everything that I am
24:10
providing here for you guys today is a
24:12
information and it shouldn’t be
24:14
considered as personal legal advice
24:15
there hasn’t been an attorney-client
24:17
relationship created same goes for any
24:21
questions i answer via email if you do
24:25
live in the state of New York
24:28
I am qualified to to act as legal
24:31
representation but for anybody outside
24:32
of the state of New York I am only
24:34
allowed to give you information and I
24:36
can also help you find an attorney in
24:39
your state or that’s close by you that
24:40
can help you I get to help the services
24:43
that you need so that my little
24:45
disclaimer um I think that’s awesome so
24:49
as an attorney GF is pretty much
24:51
disclaim everything you say and do
24:52
throughout your daily life I you know
24:56
the law the law is not black and white
24:58
it’s grace so sometimes I find myself
25:00
feel sending text messages like oh by
25:03
the way this is not legal advice it’s
25:05
just information I should start trying
25:08
to do that for my wife is it really
25:12
legit but for your information to break
25:18
I really appreciate your time today but
25:19
thank you so very much any parting words
25:21
want to tell people it’s also i was at
25:24
any party worth you want to share with
25:26
people before we hang up yeah make sure
25:28
you get your stuff together i I’m I’m
25:31
not kidding about this stuff it it will
25:34
cost you as a cost Frank current over a
25:37
hundred thousand dollars in legal fees
25:39
and he wound up not even fighting it you
25:41
wound up he wound up settling so he had
25:43
to pay a hundred thousand dollars in
25:44
fees plus I think a 250 thousand dollar
25:48
settlement or something like that so if
25:50
you would have just had a internet
25:53
attorney go through all this stuff it
25:54
wouldn’t have cost them you know ten
25:57
percent of all that so really what I
26:00
know I know you don’t want to spend the
26:02
money I know it’s annoying to think
26:03
about but protect yourself as much as
26:06
you can it will really benefit you in
26:09
the long run Frank thank you so much but
26:12
appreciate your time all right thank you
26:13
it’s great being here thanks for
26:16
listening to funnel hacker radio podcast
26:17
if you’d like to be notified anytime we
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