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FHTM Operators Settle, Agree to Pay $7.75 Million To Former Customers

May 13, 2014

Operators of Fortune Hi-Tech Marketing, the pyramid scheme shut down by the government at the beginning of 2013, have have agreed to pay $7.75 million to former customers. The settlement with the Federal Trade Commission and the states of Illinois, Kentucky and North Carolina also stipulates that FHTM officials are to be banned from future participation in multi-level marketing businesses.

Kentucky Attorney General Jack Conway spoke about the settlement in this article from Kentucky.com:

“This was a classic pyramid scheme in every sense of the word,” Conway said in a news release. “The vast majority of people, more than 90 percent, who bought in to FHTM lost their money. Today marks the end of one of the most prolific pyramid schemes operating in North America.”

Some concessions were made to the defendants, most notably in that they neither admit nor deny the allegations that FHTM was an illegal pyramid scheme. Furthermore, the $169 million judgment, which represented estimated consumer losses, was reduced to the aforementioned $7.75 million.

The death of FHTM founder, Paul Orberson, in December, 2013, precipitated the settlement. Thomas Mills, former CEO of FHTM, had this to say:

“The destruction of a decade old business and the subsequent health challenges and passing of Paul Orberson made settlement an inevitable path to resolution,” the statement said. “We deny all of the allegations made by the government in this case. In order to avoid the additional emotional stress and costs of likely years of litigation, we felt it in our best interests and the interests of others to put this behind us and settle this matter.”

In the FTC statement on the settlement, the listed parties banned from future participation in MLMs include “Thomas A. Mills, Fortune Hi-Tech Marketing Inc., FHTM Inc., Alan Clark Holdings LLC, FHTM Canada Inc., and Fortune Network Marketing (UK) Limited”. You can read the official court filings here.

14 Comments leave one →
  1. May 14, 2014 5:36 pm

    Good article. Always gratifying when a pyramid scheme collapses or gets shut down. Are Amway and Team headed for the same fate or are they technically “legitimate”? They say all pyramid schemes eventually collapse, but these two don’t seem to be yet.

  2. Melanie Morgan permalink
    May 15, 2014 5:20 am

    Most don’t hear about the ones that “collapse”…here is quite the list of “dead” or “shut down”ones…Most I have Never heard of!

    http://www.mlmwatchdog.com/dead_mlm_companies.html

    But I would bet my bottom dollar if we were able to compare them overall, there isn’t much noticeable difference between them. But then I think by now this is becoming be common knowledge.

    It is great when they FINALLY get shut down, unfortunately it takes years of them scamming and then DENY any wrong doing, disturbing! They got away with robbing people of 163 million dollars and only have to repay 7.75 million? That’s a shame…just a Slap on the wrist!

  3. Melanie Morgan permalink
    May 15, 2014 6:03 am

    But then lets not forget the DSA; that awesome organization who makes it all possible🙂.. (who somehow have changed their original purpose from the protecting the individual to became lobbing $$$ for the companies…we all know money talks ).

    They are supposedly the integrity of the industry??..Using lots of $$ to exempt MLMs from having to be transparent…and add in there too, there isn’t enough Consumer Protection Resources or enough complaints…etc…

    So the question remains… how many are really in operation as an illegal pyramid scheme because of loop holes, remaining ‘private companies’ or just off the radar because the lack of complaints? How many Would they be found out, if they were investigated?

    Funny but NOT.. all the ones when IN operation are lifted up as being “part of the greatest life changing industry” (as long as they are in operation) just because they are part of it…

    But when nailed and investigated found to be: ,“This was a classic pyramid scheme in every sense of the word,”… Then all the other paid promoters and MLMer’s are excited they got shut down??!!!! Hmm…really? What a joke… So pathetically obvious!!!

  4. Melanie Morgan permalink
    May 15, 2014 7:47 am

    Should say 169 million, oops!

    huperdiem~

    It is interesting, isn’t it? Not surprising though when you read the details and what the AGs & FTC found:

    “The vast majority of people, more than 90 percent, who bought in to FHTM lost their money. Today marks the end of one of the most prolific pyramid schemes operating in North America.”

    Read more here: http://www.kentucky.com/2014/05/13/3240869/operators-of-alleged-pyramid-scheme.html#storylink=cpy

    More than 90% lost money…and recruitment not product focused! Don’t know about you but from our experience and of course learning the real truth and way more after the fog lifted after we left, this comparison would be pretty much dead on…or very similar to that experience.

    How many other Mlms fall into 90% of the people losing more than they will ever make?

    But thanks to this site and many other great people who file complaints and from many other MLMs and websites, books etc… who are the real courageous ones…The truth and the pyramid schemes are finally getting shut down!

    I Do give the AGs, SEC, FTC, FBI etc.. credit for Shutting them down! Another quote from the article I found promising:

    “This is a ‘wake up and smell the coffee’ moment for any promoters of illegal pyramid schemes trying to hide behind labels like multilevel marketing,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection. “The FTC wants consumers to know that eventually, all pyramid schemes collapse, and nearly everyone who signs up with the companies loses his or her money.”
    🙂

  5. Melanie Morgan permalink
    May 15, 2014 8:44 am

    http://seekingalpha.com/article/2216813-herbalife-a-precedent-has-been-set-now-shut-it-down

    Great points, wonder how many agree?

  6. May 15, 2014 9:05 am

    Good thoughts. Maybe Team just isn’t big enough to get on the FTC radar yet? If FHTM and Herbalife both qualify as illegal, surely Team/Life would as well. But how many years has Amway been able to escape? My problem is, I have no patience. I want justice yesterday! And I want my friends out of this sham.😦

  7. Melanie Morgan permalink
    May 15, 2014 9:39 am

    huperdeim~

    I feel your pain and hope your friends wizen up, swallow their pride, cut and run and the scales be removed from their eyes…and most important…JUSTICE be served!

    No one knows what the future holds but based on the current information, and study the past…. things look a lot more promising.🙂 More people are coming forward and you know what they say…you can’t stop something who’s time has come!🙂

    On One side of the coin, the scammers…. “promoters of these illegal pyramid scams”…get a head start by these others being shut down…they will race to try and CTA or to remain one step ahead of the law…. and at least superficially they try and look legit…but then I think most know….you can’t run or hide forever….and eventually….you will reap what you sow….

  8. Melanie Morgan permalink
    May 15, 2014 10:44 am

    What how many of them out there, just keep sayin;….”FAKE IT TIL THEY MAKE IT?”….Poser…. LOL

  9. Melanie Morgan permalink
    May 15, 2014 11:14 am

    Sorry, still laughing… just remembering some of the Team’s… “life changing”…great “leadership… training”….

    Wasn’t their a CD on How to “master” poserie= “fake it til you make it”?

    Oh maybe my bad…think it might have been “Are you a poser?”

    Which message was it?🙂

  10. May 15, 2014 12:19 pm

    There was a post on this here:

    http://aronradosa.net/2012/09/25/faker-vs-poser-more-than-the-same/

  11. Melanie Morgan permalink
    May 15, 2014 1:52 pm

    Amthrax~

    Thanks! I have never seen that! Geez make up your mind already….apparently it is a good thing NOW or puts you above the rest? Hahaha…. from their leeeaders “experts”.. to develop poserie?…..Too funny.

    I was thinking of the CD by Tim Marks that instructed you NOT to be a poser. lol

    Guess now they have found a way to make it (at least Arron teaches it as a) “great trait?”…. Hmmm… I am confused :)…..So which or who must the follower….follow?…. What or who should those followers believe?

    Like so many or most all of their other “messages” (it would be fun to list) what ever suits the situation to keep them poor suckers, confused and believing.

    I see it as….or the same as their….”situational “ethics”…we experienced.

  12. Melanie Morgan permalink
    May 15, 2014 1:58 pm

    Does anyone else remember the CD by Tim Marks that I believe was called Power Player or Poser or vice versa….perhaps that is even wrong…it has been a while🙂

  13. TruthSeeker permalink
    May 16, 2014 4:07 am

    Product based pyramid schemes are great profit producing ventures, both Zeekular and FHTM prove that.

    If they are never examined they bilk people for billions, if examined they get slapped with measly fines, take a year off, then do it again.

    Why does Madoff get jail, but these guys get off? It’s a very broken system that allows criminals to become millionaires by defrauding others.

  14. Melanie Morgan permalink
    May 16, 2014 5:43 pm

    Truthseeker~

    So true…Excellent post and Amen to that!

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