MRINetwork Misrepresentation and/or Fraud - franchise ethics

MRINetwork consists of a global set of franchisees all working to the same methodology and systems as trained by MRI Corporate. The network is a powerful aspect of the group. Single offices are able to work in isolation and do so. However, one of the main selling points of joining such a network is the ability to immediately work with other franchised offices around the globe and share candidates, job orders and resulting cash from successful placements. This process is called Inter Office Referral or IOR.

When I joined the network, I was trained in benefits of inter working with the rest of the network. It made sense and was part of the reason I purchased the franchise. The concept was, we all work to the same high standards, we all are trained to the same level, we all are governed by the Franchisor in terms of reporting, paying royalties and sharing work (IOR).

When CDI Corporation purchased The Humana International Group (HIG) in April 1999, they integrated it into their MRI group thus creating an international arm to their USA recruitment business. In this acquisition they inherited a franchisor who I will refer to as Mr JW. Mr JW had not been paying his royalties to the previous franchisor and had amassed large debts.

At acquisition (April 1999) Mr JW owed £31,785 UK Pounds (approx $59,027.62 USD) to the MRINetwork and CDI Corporation (their owners) in unpaid royalties. That was a pretty dire situation for any good franchisor to inherit.

So what did MRI do about it? Did they sling him out of the network for breach of contract? No.

Did they allow him to stay in the network but prevent him from inter working with other offices to protect them from his track record of non payment? No.

Well, they did not address this problem. In fact they allowed Mr JW's unpaid royalty debt to grow year on year. Over the following years (1999 - 2003) they allowed this debt to grow to an astonishing amount of £170,477:60 UK Pounds (approx $316,626 USD).

During all of this time, April 1999 to early 2003, CDI Corporation and MRINetwork management chose to misrepresent Mr JW to the whole of the MRINetwork franchisees as a regular franchisee, with whom we were repeatedly encouraged to inter work and share work with (IOR).

That in my opinion is misrepresentation and possibly fraud by MRINetwork and their owner CDI Corporation. In my opinion it also demonstrates a number of other issues that I have raised in my correspondence to Roger H Ballou. See these points highlighted in Roger H Ballou's response and form your own opinion on the franchise ethics and business practices of MRINetwork and CDI Corporation.