What warranty does a Cream franchisee provide regarding their owners' compliance with U.S. anti-money laundering and counter-terrorism financing laws?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
Specially Designated Nationals; (ii) the U.S. Commerce Department's Denied Persons List, Unverified List, Entity
List, or General Orders; (iii) the U.S. State Department's Debarred List or Nonproliferation Sanctions; or (iv) the Annex to U.S. Executive Order 13224.
(2) A person or entity who assists, sponsors, or supports terrorists or acts of terrorism, or is owned or controlled by terrorists or sponsors of terrorism.
You further represent and warrant to us that you and your owners are now, and have been, in compliance with U.S. anti-money laundering and counter-terrorism financing laws and regulations, and that any funds provided by you or your owners to us or our affiliates are and will be legally obtained in compliance with these laws. You agree not to, and to cause all of your owners, employees, agents, representatives, and any other person or entity associated with you not to, during the Term, take any action or refrain from taking any action that would cause such person or entity to become a target of any such laws and regulations.
20. EXECUTION.
This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. This Agreement may be executed by electronic means.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, a franchisee must warrant that they and their owners are currently compliant with U.S. anti-money laundering and counter-terrorism financing laws and regulations. They also warrant that any funds provided to Cream or its affiliates were legally obtained in compliance with these laws.
This warranty extends beyond the initial agreement, as the franchisee must agree to ensure that they, their owners, employees, agents, and representatives do not take any action that would cause them to become a target of these laws and regulations during the term of the agreement. This places an ongoing obligation on the franchisee to maintain compliance and prevent any association with prohibited activities.
Cream also requires the franchisee to represent that neither they nor their owners, employees, agents, or representatives are listed on any U.S. government lists related to terrorism or prohibited parties. This includes lists maintained by the U.S. Treasury Department, the U.S. Commerce Department, and the U.S. State Department. The franchisee must also warrant that they are not a person or entity who assists, sponsors, or supports terrorists or acts of terrorism, or is owned or controlled by terrorists or sponsors of terrorism.
This requirement is an express consideration for Cream granting the franchise, highlighting the importance Cream places on compliance with these laws. Prospective franchisees should carefully review these requirements and ensure they can meet these obligations to avoid potential legal and financial repercussions.