WKYT | Lexington, Kentucky | News

Lexington company accused of running pyramid scheme

LEXINGTON, Ky. (WKYT) - If you call the Lexington headquarters of Fortune Hi-Tech Marketing, you won't reach an operator. Instead, you'll hear the following message, "Members of a court-appointed temporary receiver temporarily suspended FHTM, your beloved business,"

Today, Attorney General Jack Conway announced Kentucky has joined Illinois, North Carolina, and the Federal Trade Commission in a lawsuit against FHTM, claiming it's a massive pyramid scheme.

"We think today's actions are the beginning of the end for one of the most prolific pyramid schemes operating in North America," said Conway.

Conway said his office got about a dozen complaints regarding the company and began an investigation in the summer of 2010. FTC officials said FHTM recruited employees to sell its products.

"They're selling mainly things of dubious value. These include their own line of organic shampoos and pills," said Steve Baker, director of the FTC's Midwest Region Office.

Conway said the emphasis within FHTM wasn't on selling the products, but on having its associates recruit people to join the company so they could get bonuses, making it a pyramid scheme as opposed to a legitimate business.

"90% of Fortune Hi-Tech Marketing members earned $15 a year or less, yet by the time you pay the initiation fee and the package fee for products, it costs about $1,500 a year," said Conway.

FHTM's president, Paul Orberson, and CEO, Thomas Mills, were also named in the lawsuit. FTC officials said more than 100,000 people may have been involved and the damages may be in the hundreds of millions of dollars.

"We think they may have been doing $30 million a month," said Baker.

WKYT was unable to reach company officials for comment, but according to that message on the company hotline, they plan to present their side soon.

"We will be defending ourselves vigorously on Thursday, February 7th, 2013. While operations are now temporarily suspended, we truly expect to be vindicated," was the recorded message.


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