Fortune Hi Tech Marketing - Round #2

"Buy 1 for yourself and get the chance to sell your friends and family 5 and get your downline started!" We examine the multi-level marketing industry, where only the people who come up with the ideas make any money, and everybody else is left unhappy, broke, and tired of reading scripts and selling overpriced vitamins and similarly worthless products. Includes Global Prosperity, Pinnacle Quest International, IRS Codebusters, Stratia, and other new Global Prosperity scams.

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Doc Bunkum
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Fortune Hi Tech Marketing - Round #2

Postby Doc Bunkum » Sun Sep 05, 2010 1:44 pm

I realize there's already a thread about Fortune Hi Tech Marketing and their Montana adventures. Now they've been served with a federal class-action lawsuit. I figure a new thread would make it easier to follow along and watch the developments.

Class action lawsuit filed against Kentucky company
WHAS11.com- Posted September 3, 2010 at 6:44 PM - Updated Saturday, Sep 4 at 12:15 AM

(WHAS11) A Kentucky multi-level marketing company has been served with a federal class-action lawsuit.

Fortune Hi Tech Marketing has already been sanctioned by two states, which served it with cease and desist orders.

Agreements have been reached in both of those cases, but now four former members have filed a class action lawsuit, questioning Fortune's business practices and asking a judge to refund all of its members' money.


All network marketers should pay attention to this one.

MLM-theWholeTruth reports...

At the heart of the lawsuit is the issue that all networkers need to understand. For a company to stand legal scrutiny, distributors cannot in any way shape or form be compensated for recruiting other distributors.


Point 85 of the lawsuit deals with this issue:

85. Fortune’s commission structure makes this possible by allowing IRs [Independent Representatives] to earn commissions on sales without ever actually selling anything to a customer outside the Fortune Pyramid. In fact, prospective IRs are told while joining Fortune that they must purchase certain products to earn their first “customer points” and therefore allow bonuses to be paid to their sponsors.


Should be interesting to see how this one goes. :D

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wserra
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Re: Fortune Hi Tech Marketing - Round #2

Postby wserra » Mon Sep 06, 2010 2:08 pm

The original FHTM thread got derailed dealing with the "Fortune Social" piggyback scam.

Without knowing anything specific about this lawsuit, I have considerable misgivings about class actions in these circumstances. Too often, a large chunk of a settlement goes to the lawyers, and individual class members get almost nothing. Probably most of the people reading this have at one time or another received a notice of a proposed class settlement when you didn't even know that you were members of the class. Anyone who has a real case will usually opt out of the class and go it alone.

Anyway, the Montana cease-and-desist settlement had at least one positive - a requirement that FHTM disclose limited income figures. "Limited" because the only requirement is that the figures include those distributors who earn commissions, a group which frequently comprises less than half of all distributors. We have no way of knowing in the FHTM case, since they (like the large majority of MLMs) are a privately-held company. Still, the figures are interesting.

The earnings of the mean distributor - the one at the 50% mark of all distributors - is a more meaningful number than average, since the average is skewed upwards by the high earnings of those at the peak of the pyramid. The mean distributor of those who earn anything at all makes less than $1000/year. Ninety-five percent of those who earn anything at all make less than $3000. Moreover, even those puny numbers are less than accurate. FHTM notes that "Average monthly payment is based only on months that Representatives received payment" - in other words, they don't factor in the zeros from the other months. So their "annualized income" figures distort first by including only those get commissions, and then by ignoring any zero months.

Nice "opportunity".
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Dotel

Re: Fortune Hi Tech Marketing - Round #2

Postby Dotel » Mon Nov 29, 2010 7:00 pm

wserra wrote:The original FHTM thread got derailed dealing with the "Fortune Social" piggyback scam.

Without knowing anything specific about this lawsuit, I have considerable misgivings about class actions in these circumstances. Too often, a large chunk of a settlement goes to the lawyers, and individual class members get almost nothing. Probably most of the people reading this have at one time or another received a notice of a proposed class settlement when you didn't even know that you were members of the class. Anyone who has a real case will usually opt out of the class and go it alone.

Anyway, the Montana cease-and-desist settlement had at least one positive - a requirement that FHTM disclose limited income figures. "Limited" because the only requirement is that the figures include those distributors who earn commissions, a group which frequently comprises less than half of all distributors. We have no way of knowing in the FHTM case, since they (like the large majority of MLMs) are a privately-held company. Still, the figures are interesting.

The earnings of the mean distributor - the one at the 50% mark of all distributors - is a more meaningful number than average, since the average is skewed upwards by the high earnings of those at the peak of the pyramid. The mean distributor of those who earn anything at all makes less than $1000/year. Ninety-five percent of those who earn anything at all make less than $3000. Moreover, even those puny numbers are less than accurate. FHTM notes that "Average monthly payment is based only on months that Representatives received payment" - in other words, they don't factor in the zeros from the other months. So their "annualized income" figures distort first by including only those get commissions, and then by ignoring any zero months.

Nice "opportunity".


Great info!

I do have some questions.

To understand what you are saying, FHTM income disclosure statement is not only leaving out months reps didn’t earn a check, but the numbers are skewed by the few top money earners at the top of the pyramid. For instance, the 54% of the reps at the Manager level, the base of the pyramid, show the average earning as $93 a month, could in fact be less than that? Is there a way to know what the real number would be?

Also after reading FHTM’s IDS, just below the chart, it shows the reporting period was done on 71.85% of all active independent reps that earned at least one commission or bonus payment. I take it FHTM did not include 28.15% of the reps that didn’t earn a check into the IDS? If they did I take it that would also make the average earnings dip lower than what it shows.

After reviewing FHTM's IDS, I'm not impressed. From what I can see 95% of the reps in FHTM are not making any money at all, that is if you figure in the monthly product purchase. That would be most of the reps in the company.

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Re: Fortune Hi Tech Marketing - Round #2

Postby wserra » Tue Nov 30, 2010 1:00 am

Dotel wrote:To understand what you are saying, FHTM income disclosure statement is not only leaving out months reps didn’t earn a check,


What else does "Average monthly payment is based only on months that Representatives received payment" mean? Those averages go up pretty quickly when you don't factor the zeros in.

but the numbers are skewed by the few top money earners at the top of the pyramid.


Well, where you have a chart divided into segments, as here, you'd have to say that the average for each segment is skewed upwards by those in the segment who make much more than the median. If you look at the ones in the list which do give both the median and the average for each segment, you'll see that the effect is most noticeable at the lowest level, where most of the distributors are. For example, for Send Out Cards, where 90% of their "active" members are at the base "Distributor" level, the average annual income for that level is $90, while the median is $9. Don't spend it all in one place.

For instance, the 54% of the reps at the Manager level, the base of the pyramid, show the average earning as $93 a month, could in fact be less than that?


The median likely is much less than that.

Is there a way to know what the real number would be?


Not without the data. To find the median, you'd first have to find the distributor at the 50% mark of all distributors.

Also after reading FHTM’s IDS, just below the chart, it shows the reporting period was done on 71.85% of all active independent reps that earned at least one commission or bonus payment.


Please note that weasel word "active". They define it as "who qualified to receive commissions and bonuses during the 12-month reporting period of January 23, 2009 through January 20, 2010", but they don't tell you what percent of all distributors are "active".

I take it FHTM did not include 28.15% of the reps that didn’t earn a check into the IDS?


In addition to the ones they define as "inactive". Right. Now you're starting to get the idea of how badly even these puny numbers are skewed.

If they did I take it that would also make the average earnings dip lower than what it shows.


An eminently reasonable assumption. That's why they don't.

After reviewing FHTM's IDS, I'm not impressed. From what I can see 95% of the reps in FHTM are not making any money at all, that is if you figure in the monthly product purchase. That would be most of the reps in the company.


Ninety-five percent, to be exact.
"A wise man proportions belief to the evidence."
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Re: Fortune Hi Tech Marketing - Round #2

Postby Doc Bunkum » Tue Nov 30, 2010 2:53 am

Oh, on second glance I see that FHTM is listed in the MLM Income Disclosures thread. Missed it the first time. Anyways, this story still might be of interest.

I-Team Investigation: Income statements released by Ky. company show employees typically earn little


LEXINGTON, Ky. (WHAS11) July 14, 2010
-- A Kentucky-based company has been the target of legal actions by two different states...

Montana investigators say most of the state's 3,000 Fortune reps paid hundreds of dollars to join, but made little or no money. The state called fortune a "pyramid promotional scheme" and ordered the company to make annual income statements available. Fortune agreed to post them in order to continue operating in Montana.

It wasn't easy for us to find the financial disclosure statement, but we finally did after navigating the website for a while. We went under “opportunity”, then clicked on “rewards,” then we had to scroll down past the photographs of Fortune members swimming with the dolphins and a family picking up the new Lexis in order to find a tiny link at the bottom of the page. The information inside speaks volumes about Fortune's compensation.

In the fine print, it says 71 percent of reps are actually paid. 28 percent earn zero. As for how the rest would look on a graph, “It would certainly have a pyramid shape to it,” said Charlie Mattingly, CEO of the Louisville Better Business Bureau. Nearly 95 percent of reps earn less than $3,000 a year. Another four percent earn between $3,000 and-$30,000. That means less than half of one percent of Fortune reps average more than that.

“What these numbers show is that relatively few people are making substantial amounts of money. 95 percent of the participants are making very little money,” said Mattingly.


You can click here to see FHTM annual income statements.

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Re: Fortune Hi Tech Marketing - Round #2

Postby soapboxmom » Thu Dec 09, 2010 2:33 am

http://www.starnewsonline.com/article/20101204/ARTICLES/101209853/1155?p=1&tc=pg details the legal actions and investigations of FHTM. Hilariously, one poor slob making a claimed $1,500 a month average admits there are around 9000 people in his downline. So, what chance do those 9000 under him have of making money? Hint, hint!!! They will need their own gargantuan towering pyramid under them. A losing math game for sure.

The FHTM version of the American Dream is detailed http://www.starnewsonline.com/article/2 ... 09852/1155. This makes it clear why desperate actions like suicide can be the result of the financial devastation caused by MLM. How does the average individual or family dig out of that mess???

Soapboxmom

fhtmclassaction

Re: Fortune Hi Tech Marketing - Round #3

Postby fhtmclassaction » Sat Dec 25, 2010 4:26 pm

Just in case the class-action filed in September wasnt enough to keep the FHTM legal team busy through the holiday season they were just hit with another one.

A 2nd major class-action filed in Southern District of California on December 22, 2010 mirrors in many ways the previous one from Kentucky with a little more spice.

How does this company stay alive with:
1. Vendor lawsuits up the ying yang
2. Companies like GE & DuPont contemplating trademark infringement lawsuits
3. Class action in Kentucky
4. Class action in California
5. Kentucky AG investigation
6. Texas AG Investigation
7. NC Department of Justice Investigation and last but not least the
8. FTC & SEC investigations

What a banner year 2010 has been for Fortune. Keep up the good work folks and by all means this should make a banner 10 year celebration in a few weeks.

fhtmclassaction

Re: Fortune Hi Tech Marketing - Round #2

Postby fhtmclassaction » Tue Feb 01, 2011 5:40 pm

Canadian Police Bring Criminal Fraud Charges against MLM...

Does this sound familiar? Is FHTM founder next??

Royal Canadian Mounted Police (RCMP) in the province of Manitoba in central Canada have brought criminal fraud charges against a prominent multi-level marketing company, its president and 12 of its promoters. The prosecution is a clear warning to any consumer about the risks of joining or recruiting for a multi-level marketing company. Previous lack of prosecution or claims of legality by the company are no protection. This MLM company had never been prosecuted. It held public recruitment meetings all over Canada, advertised with billboards and had thousands of loyal supporters.

The MLM, called Business in Motion, was the subject of a national television news exposé in 2009, in which Pyramid Scheme Alert president, Robert FitzPatrick, went undercover with the news producers, attending a recruitment meeting with hidden cameras and microphones. He was later interviewed on the show to explain and analyze the scheme’s deceptive income promise and pyramid business model. The company president, Alan Kippax, now charged with criminal fraud, aggressively defended BIM on the same show, arguing that the company had never been prosecuted or even investigated.

BIM President, Alan Kippax (CBC Photo), Charged with Criminal Fraud

The news program also showed video of police arresting Canadian consumer advocate, David Thornton, founder of crimebustersnow.com , while he peacefully and legally protested the BIM scheme and warned consumers that it was fraudulent. He was later released without charges, raising the obvious question of whether local police were protecting the BIM scheme. The news program also showed how the Canadian Competition Bureau, equivalent to the US Federal Trade Commission, remained silent in the face of mounting evidence of fraud. The Competition Bureau still has not prosecuted the scheme or even issued a warning to consumers. :Axe:

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Re: Fortune Hi Tech Marketing - Round #2

Postby wserra » Wed Feb 02, 2011 12:41 am

For readers' information, "fhtmclassaction" posts from the same IP as did "FHTM". It's Joe Isaacs, of the "Fortune Social" piggyback scam, whom we discussed in the original FHTM thread.
"A wise man proportions belief to the evidence."
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FHTM

Re: Fortune Hi Tech Marketing - Round #2

Postby FHTM » Tue Feb 08, 2011 8:41 pm

Good guess but wrong info darling

FHTM

Re: Fortune Hi Tech Marketing - Round #2

Postby FHTM » Tue Feb 08, 2011 8:45 pm

Good guess but wrong info darling[quote="Doc Bunkum"]Oh, on second glance I see that FHTM is listed in the MLM Income Disclosures thread. Missed it the first time. Anyways, this story still might be of interest.

I-Team Investigation: Income statements released by Ky. company show employees typically earn little


[quote]LEXINGTON, Ky. (WHAS11) July 14, 2010
-- A Kentucky-based company has been the target of legal actions by two different states...

Montana investigators say most of the state's 3,000 Fortune reps paid hundreds of dollars to join, but made little or no money. The state called fortune a "pyramid promotional scheme" and ordered the company to make annual income statements available. Fortune agreed to post them in order to continue operating in Montana.


Many in multilevel marketing sales find it hard to earn much
By Jayne O'Donnell, USA TODAY

With the "tape of the week," the "book of the month," the seminars, rallies and conventions Jim Wittlich and his wife, Lori, paid for, the couple spent thousands of dollars in the two years they were Amway distributors.

Wittlich says they weren't forced to pay for marketing materials and meetings but were told repeatedly that these "tools and functions" were necessary for success in the multilevel marketing organization. They would be "looked down upon and chastised" if they didn't buy them, Wittlich says.

Multilevel, or "network," marketing pays commissions to salespeople for the products they sell, on products sold by others they recruit, and often bonuses when their teams reach a certain level of sales.

The Wittlichs' experience mirrors some of the claims in a class-action lawsuit against Amway and some of its high-level distributors that the company agreed to settle in November. In the settlement, which is awaiting a judge's approval, Amway agreed to pay $55 million to former distributors, closely oversee high-level distributors who run training businesses, strengthen refund policies and make other changes estimated to cost an additional $100 million. The lawsuit alleged Amway is a "pyramid scheme" — which was changed to "illegal scheme" in an amended version — in which distributors rarely sell products to outside customers, only to other new distributors they bring in, who must bring more recruits in to make money. New entrants, the lawsuit says, were "effectively required" to purchase products and event tickets from the high-level distributors.

Amway general counsel Mike Mohr says "the case was not proven" and that Amway chose to settle because "we're focusing on building a healthy business." In the settlement agreement, the company said it was not acknowledging "any fault, liability, or wrongdoing of any kind."
While Amway is one of the best known among multilevel marketing companies, there are hundreds of firms in the industry, with more than 16 million people selling everything from clothing to jewelry to vacations. These include Avon and Mary Kay, which have largely avoided the legal challenges about recruitment that have dogged Amway for decades. Product commissions can be as little as 1% — or less than $1 on a $100-a-month cellphone bill — or much larger on high-margin products such as vitamins or skin care products. But critics say new salespeople can seldom sell enough to earn anything close to the money those higher in the companies do — the more senior people get a cut of the sales of everyone their recruits bring in.

USA TODAY reported in October that another multilevel marketing company, Fortune Hi-Tech Marketing, was under investigation by at least four state attorneys general amid allegations that salespeople are primarily paid for recruiting, not product sales, and that more recent recruits can't earn anything near what early entrants do. In a lawsuit the company settled last spring without admitting wrongdoing, Montana charged Fortune was a pyramid scheme. Lynne Egan, Montana's deputy securities commissioner, says she's aware of new investigations of Fortune and says her office has received inquiries from about a dozen state, federal and self-regulatory organizations about the company. Two lawsuits seeking class-action status are also pending against Fortune.

Fortune would not comment on allegations, but spokesman Brian Wright says Fortune "continues to strive to improve this company."

Path to earnings
Even proponents of multilevel marketing say the cases and probes underscore one of the growing problems in the industry: It can be very difficult, if not impossible, for most individuals to make a lot of money through the direct sale of products to consumers. And big money is what recruiters often allude to in their pitches.
With the growth of discounters including Walmart and retail websites, few people need to buy toiletries, detergent or vitamins from a friend or neighbor, especially with the higher prices charged so all the commissions can be paid. Making money by recruiting more people, selling them training materials and persuading them to buy products can become the only way to make much money at some of the companies.


"The problem so many have is their prices aren't competitive in the real world," says Lou Abbott, who works in multilevel marketing and owns the industry site MLM-TheWholeTruth.com.

When it comes to detergent, Consumer Reports program manager Pat Slaven agrees. She did blind testing of detergents last year and ranked versions of Amway's Legacy of Clean detergents ninth and 18th of 20 detergents tested. She recommends against buying them because consumers can "go to the grocery store and get something that performs a whole lot better for a whole lot less money." The highly concentrated Amway brands cost 23 cents and 28 cents a load, respectively. Five of the eight recommended brands cost less.

A 31-day supply of Amway's Nutrilite Double X multivitamins is $75. Supplement retailer GNC's most comparable product, Ultra Mega Green multivitamins, cost $40 for a 60-day supply.
Amway North American managing director Steve Lieberman says, "The quality of our products (is) reflected in our pricing."

Roland Whitsell, a former business professor who spent 40 years researching and teaching the pitfalls of multilevel marketing, says it's little surprise Amway's big growth is now outside of the U.S. He says the "direct selling" in multilevel marketing is needed in countries with "primitive distribution systems and limited choices in retail stores," but its potential is "seriously limited" here.

Lieberman notes the company is "extremely successful in formerly communist countries and in developing countries." Sales were also up last year in the U.S. by about 5%, he says.

Costs of doing business
Wittlich says he worked day and night on his Amway business and never made a profit. "Active" Amway distributors earn an average of just $115 a month, according to Amway's latest disclosure statement. Just a quarter of 1% (0.26%) make more than $40,000 a year, which Amway attributes to the fact many work part time. Active distributors, which describes about 60% of Amways's 600,000 North American distributors, get at least one bonus check or make one sale or meeting a year.

"You'd be hard-pressed to find anyone making over $1.50 an hour," Whitsell says of multilevel marketing. "The primary product is opportunity. The strongest, most powerful motivational force today is false hope."

Jeff Pokorny and Bill Blenn, two of the lead plaintiffs in the class-action lawsuit, both bought tickets and paid for their own travel and accommodations to attend conventions called "Dream Night," according to the class-action suit, which was filed in 2007. Amway distributors — known as Independent Business Owners (IBOs) — were encouraged to attend the convention through messages on a high-level distributor's website, which also "contained

material false representations regarding the wealth that would be achieved" if distributors bought the materials and attended functions, the lawsuit says. Tickets for these events alone could cost $200 to $400.

"We discourage dream selling," says Lieberman, noting the new disclosure document "deliberately put a dose of reality into recruitment."

The sale of training materials has to be a "very small" part of distributors' businesses, or "people will focus more on that aspect of the business than on the aspect of selling products to customers," says Gerry Nehra, a Michigan attorney representing multilevel marketing companies and former director of the legal division of Amway from 1982-91.

Nehra, who would not comment on Amway specifically, says that when selling training materials becomes the focus, the business becomes "overly dependent" on recruiting more representatives, which raises questions about whether a company is a pyramid scheme.
"Corporate turned a blind eye to it," says Wittlich, who left Amway in 2000.

'Transformed' business
In the last three years, Amway has been spending about $10 million more a year on training of new distributors and has "transformed" its business, Lieberman says. Outside training companies must now sign licensing agreements.

There's no question Amway promotes its products: Miss America 2011 Teresa Scanlan is an "ambassador" for the company's Artistry skin care line. Amway also recently signed former Super Bowl MVP Kurt Warner in an endorsement deal for its Nutrilite vitamin line.

Jack Tucker of Knoxville, Tenn., who spent 28 years in wholesale sales, says the products simply weren't priced competitively enough to sell. He could only find one customer willing to pay for Amway's products in the year he was an IBO in the late 1990s.

He earned $4 in commissions on the sale of a concrete cleaner to a friend, yet spent nearly $800 on trips, one or two training tapes a week, meetings and products.

While "they didn't hold a gun to your head ... they expected you to do it," he says of the training purchases.

Abbott says nearly all multilevel marketing companies prohibit distributors from selling "tools." When they are allowed, the products are supposed to be sold at cost. He notes $8 DVDs are a "profit center" when they cost "25 cents" to produce.

Amway's business concept "is a brilliant idea," says Abbott, who has worked with former Amway IBOs. "In practice, it sometimes gets skewed."

The class-action lawsuit also alleges Amway broke the law by telling people they could "significantly supplement their incomes, or even become rich and retire" when about 99% of distributors lost "significant savings" because they had to buy so many training materials as well as the company's own products. Says Amway spokesman Rob Zeiger, "We're not in favor of people spending more than they are making."

The Federal Trade Commission Act prohibits "deceptive and misleading practices," which Monica Vaca, assistant director for the FTC's division of marketing practices, says may include claims about what people make that don't make "clear if it's not typical of what everyone who joins is making,"

'Choose to be a king'
Ruel Morton and Todd Rowland, two top Fortune money earners, are both offering "boot camps" to train the thousands of salespeople under them in their "downline." Morton's now-frequent pitches for the $395 three-day seminars at his Texas ranch are not subtle.
"You can either choose to be a king or you can settle for being the subject of someone else's kingdom!" he exclaims on his website, RuelMorton.com.

In a video Morton and his wife posted on the site, Morton declares, "Fortune has set us free financially." He offers amenities including organic food, a beach, bat cave and trolley tours at the "$12 million Yellow Rose Ranch."

"Fortune Hi-Tech Marketing is strongly committed to integrity and expects the same from its Independent Representatives," said Wright. "FHTM is working toward resolving any concerns about its business in the proper venues." (Fortune's independent managers must refer media calls to the company.)

On his website, CoachRowland.com, Rowland says the benefits of his new $100-a-day "millionaire boot camp" include "making big checks immediately." The training cost — $150 if a spouse attends — includes food, activities, training, a workbook and "a set of Todd's favorite educational CD's."

"Presidential ambassadors" such as Morton and Rowland average $1,240,992 in income a year, yet make up just 0.07% of the company's representatives, according to a Fortune document. It also shows 30% of Fortune representatives make nothing, and 54% of those with earnings averaging $93 a month, before costs.

Spending more than selling
Darlene Armbruster joined Fortune last November to make extra money but instead wound up spending it. She paid $199 to sign up and had to buy another $200 worth of products just to join. Recently, she got a solicitation urging her to buy other Fortune products.

"How many companies do you go into where you have to buy shirts, their DVDs and e-books in order to promote a business?" says Armbruster, who lives in Oklahoma. "My question is 'What are you doing for me?' "

Wittlich says Amway IBOs were expected to buy products added to the catalog, even if they didn't need them. When he shopped outside the company to get lower prices, Wittlich says, his sponsor would remind him he'd never succeed that way. Besides, he says, it was so hard to sell products to others to get his "meager" bonus each month, he had to "hyper consume" them. "They would use all different kinds of things, like telling you about your kids' future being at stake," he says. "We were spending money we couldn't afford to spend."

Lieberman says Amway distributors are not required to buy products and says 41% of products sold by the company are to people who are outside of Amway. As for any past pressure on distributors, "Anyone outside of our rules of conduct, we've eliminated from the business. People are not being badgered to buy things (they) don't want," he says.

Stuart Singer, a partner at Boies Schiller & Flexner, one of the law firms that represent the class-action plaintiffs, hopes the Amway settlement, if approved by a judge, will have a beneficial effect on the industry.

"If Amway recognizes the need to transform their business, then I think the other companies that are involved in multilevel marketing will have to follow suit," he says. "It's just a matter of time."

It wasn't easy for us to find the financial disclosure statement, but we finally did after navigating the website for a while. We went under “opportunity”, then clicked on “rewards,” then we had to scroll down past the photographs of Fortune members swimming with the dolphins and a family picking up the new Lexis in order to find a tiny link at the bottom of the page. The information inside speaks volumes about Fortune's compensation.

In the fine print, it says 71 percent of reps are actually paid. 28 percent earn zero. As for how the rest would look on a graph, “It would certainly have a pyramid shape to it,” said Charlie Mattingly, CEO of the Louisville Better Business Bureau. Nearly 95 percent of reps earn less than $3,000 a year. Another four percent earn between $3,000 and-$30,000. That means less than half of one percent of Fortune reps average more than that.

“What these numbers show is that relatively few people are making substantial amounts of money. 95 percent of the participants are making very little money,” said Mattingly.

bmielke

Re: Fortune Hi Tech Marketing - Round #2

Postby bmielke » Tue Feb 08, 2011 8:50 pm

FTHM You split your spam posts on two different threads.

fhtmclassaction

Re: Fortune Hi Tech Marketing - Round #2

Postby fhtmclassaction » Tue Mar 15, 2011 6:00 pm

FTC Steps Up Efforts Against Scams That Target Financially-Strapped Consumers

More Than 90 Actions Brought By Commission and Its Law Enforcement Partners

Attorney General Roy Cooper today joined state attorneys general from across the country and the Federal Trade Commission to announce a national sweep targeting business opportunity scams, including actions against four companies that have targeted North Carolina consumers.
“When jobs are scarce, claims to help people make money fast become plentiful,” Cooper said. “Consumers think they’re buying into a great way to earn a living, but they could end up paying far more than they’ll ever make.”

In challenging economic times, many people in the state are looking for work. Unfortunately, sometimes they find scams instead of legitimate opportunities. Complaints to the Attorney General’s Consumer Protection Division about business opportunity, work-at-home schemes, and other employment related scams were up 11 percent last year, from 177 complaints in 2009 to 197 complaints in 2010.

Operation Empty Promises is a national sweep by the FTC, Cooper and other state attorneys general aimed at stopping business opportunity scams and educating consumers about how to avoid them. Announced as part of the sweep are actions taken by Cooper’s Consumer Protection Division against four companies including:

Fortune Hi Tech Marketing claims that people who buy into its business earn thousands of dollars a year. Based on consumer complaints, Cooper’s office launched an investigation into FHTM in mid 2010. Consumers say they paid money to the company but were only able to make money by recruiting others into the scheme, not by selling any actual goods or services. A total of 25 consumers have now complained about FHTM, and Cooper’s office is investigating the company. Although this case is currently under investigation, it’s important for consumers to know that a pyramid scheme is a violation of the law and is defined as any plan in which a participant pays money for the chance to receive money upon the introduction of new participants into the program.

“We’re looking closely at business opportunities that seem to offer false hopes, and also reaching out to educate consumers on how to recognize and avoid fraud,” Cooper said.
Later this month, Cooper’s office plans to launch a tool kit to educate consumers on fake business opportunities which will include print, web and video materials. The goal is to prevent North Carolina consumers from losing their hard-earned money to scammers trying to take advantage of a tough employment market.

“Don’t let scammers use empty promises of jobs with high earnings to take your money,” Cooper warned consumers. “Before you agree to invest in any business, check it out thoroughly and always be skeptical of claims of guaranteed profits.”

Cooper has taken action against a number of other kinds of scams fueled by hard times. For example, his Consumer Protection Division has won 13 cases against foreclosure assistance and loan modification scams in the past five years, including two so far in 2011.The Federal Trade Commission today stepped up its ongoing campaign against scammers who falsely promise guaranteed jobs and opportunities to “be your own boss” to consumers who are struggling with unemployment and diminished incomes as a consequence of the economic downturn.

“Operation Empty Promises,” a multi-agency law enforcement initiative today announced more than 90 enforcement actions, including three new FTC cases and developments in seven other matters, 48 criminal actions by the Department of Justice (many of which involved the assistance of the U.S. Postal Inspection Service), seven additional civil actions by the Postal Inspection Service, and 28 actions by state law enforcement agencies in Alaska, California, Indiana, Kansas, Maryland, Montana, New Jersey, North Carolina, Oregon, Washington, and the District of Columbia.

In a press conference at the FTC, David Vladeck, Director of the FTC’s Bureau of Consumer Protection, was joined by Tony West, Assistant Attorney General for the Civil Division of the Department of Justice; Greg Campbell, Deputy Chief Inspector of the U.S. Postal Inspection Service; North Carolina Attorney General Roy Cooper; and a California consumer who had bought into a program to start his own Internet business.

“The victims of these frauds are our neighbors – people who are trying to make an honest living,” said David C. Vladeck, Director of the FTC’s Bureau of Consumer Protection. “Under pressure to make ends meet, they risked their limited financial resources in response to the promise of a job, an income – a chance at a profitable home-based business. But these turned out to be empty promises – and the people who counted on them ended up with high levels of frustration and even higher levels of debt.”

The FTC has updated consumer education materials to help consumers avoid falling victim to these scams. Screen shots from the websites of some of the operators charged in this law enforcement sweep, as well as video footage of FTC Consumer Protection Director Vladeck and FTC attorney Daniel Hanks, are also available at the FTC website.


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