Wednesday 30 January 2013

FTC closes 'Fortune Hi-Tech Marketing' before trial.

The following article was published on Shyam Sundar's 'Corporate Fraud's Watch' more than 2 years ago .


'Amway' and 'FHTM' are the American Dream made Nightmare.

The criminogenic organization known as 'Fortune Hi-Tech Marketing' is an 'Amway' copy-cat. i.e. 'FHTM' is the reality-inverting label over the entrance to yet another self-perpetuating 'MLM Income Opportunity' cult. 'FHTM' was instigated, and is run, by a gang of exceedingly-greedy, but otherwise-mediocre, little racketeers from Kentucky. These narcissistic parasites have begun to grow rich by peddling an unoriginal lie whilst steadfastly pretending moral and intellectual authority.

In the adult world of quantifiable reality, the authenticity of the 'FHTM' lie is currently being challenged all over the USA, after the State of Montana charged that 'FHTM' was actually a dissimulated pyramid scheme. However, exactly like the billionaire bosses of the 'Amway' mob, the millionaire bosses of the 'FHTM' mob posed as innocent Christian businessmen/philanthropists under attack and instructed their aggressive echelon of attorneys to negotiate a 'settlement' with the plaintiffs. i.e. Without admitting any fault, they agreed to hand-over a significant chunk of their ill-gotten gains in Montana, in order to continue their clandestine criminal activities elsewhere.

It is common knowledge in the USA that 'FHTM' is a pernicious blame-the-victim scam . Indeed, it is common knowledge in the USA that all so-called 'Multi-Level Marketing' companies are shielding essentially the same, dissimulated closed-market swindle. 

This general video warning has been recently produced by the Bureau of Consumer Protection at the US Federal Trade Commission . However, it beggars belief that senior FTC officials like Eileen Harrington can use public funds to pretend that the FTC wants to protect the American people from 'business opportunity' fraud, when, for decades, other senior FTC officials have allowed this cancer not only to gnaw its way into the USA, but also into the rest of the world.

Despite more than half a century of damning-evidence, senior US government trade officials prefer to remain blissfully-ignorant of the fact that behind all so-called 'MLM' companies has lurked the ongoing historical phenomenon of criminogenic, or pernicious, cultism. Meanwhile, the self-appointed bosses of these reality-inverting, totalitarian groups continue to rake-in vast fortunes by peddling variations of the same Utopian fiction as fact. 

'MLM Income Opportunity' fraud is undoubtedly a form of major organized crime spawned in the USA. It should never have been left to ill-informed, and/or corrupt, American regulators to deal with this internal threat to democracy and the rule of law.

David Brear (Copyright 2011)


Even in the light of the following news from the FTC, David Brear has not changed his overall analysis.


For Release: 01/28/2013

FTC Action Leads Court to Halt Alleged Pyramid Scheme

FHTM Promoted Itself as a Path to Financial Independence, But Most People Made Little or No Money

At the request of the Federal Trade Commission and the states of Illinois, Kentucky, and North Carolina, a federal court has halted an allegedly illegal pyramid scheme pending trial.  The FTC and the state attorneys general seek to stop the allegedly illegal practices of the Fortune Hi-Tech Marketing (FHTM) operation, which claimed consumers would make substantial income by joining the scheme.  The operation affected more than 100,000 consumers throughout the United States, including Puerto Rico, and Canada.  In some areas, including Chicago, the scheme targeted Spanish-speaking consumers.
“Pyramid schemes are more like icebergs,” said C. Steven Baker, Director of the FTC’s Midwest Region.  “At any point most people must and will be underwater financially.  These defendants were promising people that if they worked hard they could make lots of money.  But it was a rigged game, and the vast majority of people lost money.”
According to the complaint filed by the FTC and the state attorneys general, the defendants falsely claimed consumers would earn significant income for selling the products and services of companies such as Dish Network, Frontpoint Home Security, and various cell phone providers, and for selling FHTM’s line of health and beauty products.  Despite FHTM’s claims, nearly all consumers who signed up with the scheme lost more money than they ever made.  To the extent that consumers could make any income, however, it was mainly for recruiting other consumers, and FHTM’s compensation plan ensured that most consumers made little or no money, the complaint alleged.
“This is the beginning of the end for one of the most prolific pyramid schemes operating in North America,” Kentucky Attorney General Jack Conway said.  “This is a classic pyramid scheme in every sense of the word.  The vast majority of people, more than 90 percent, who bought in to FHTM lost their money.”
As alleged in the complaint, FHTM promoted itself as a way for average people to achieve financial independence.  Some FHTM representatives claimed they earned more than 10 times as much as their previous earnings in their second and subsequent years with FHTM.  One person claimed that another representative earned more than $50,000 in his sixth month and millions of dollars in subsequent years.  Another person promoted a recruitment meeting on her Twitter account, stating, “Bring ur friends & learn how 2 make $120K aYR.”  At its 2012 national convention in Dallas, FHTM called its top 30 earners to the stage to present them with a mock-up of a $64 million check, which several of them shared as a photo on social networking websites.
To participate in the scheme, consumers paid annual fees ranging from $100 to $300.  To qualify for sales commissions and recruiting bonuses, they had to pay an extra $130 to $400 per month and agree to a continuity plan that billed them monthly for products unless they canceled the plan.  Those who signed up more consumers and maintained certain sales levels could earn promotions and greater compensation, but contrary to FHTM’s claims, the complaint alleged, its compensation plan ensured that, at any given time, most participants would spend more money than they would earn.
According to the complaint, recruits were told they could earn high commissions by selling products to people outside the operation, but instead only minimal compensation was paid for sales to non-participants, and few products were ever sold to anyone other than participants.  The scheme provided much larger rewards for recruiting people than for selling products, and more than 85 percent of the money consumers made was for recruitment.
In addition to charging the defendants with operating an illegal pyramid scheme and making false earnings claims, the FTC charged them with furnishing consumers with false and misleading materials for recruiting more participants.  The attorneys general offices of Illinois, Kentucky and North Carolina joined the FTC complaint, as well as alleging violations of their respective state laws.
The defendants are Paul C. Orberson, Thomas A. Mills, Fortune Hi-Tech Marketing Inc., FHTM Inc., Alan Clark Holdings LLC, FHTM Canada Inc., and Fortune Network Marketing (UK) Limited.  On January 24, 2013, the court halted the deceptive practices, froze the defendants’ assets, and appointed a temporary receiver over the corporations pending a trial.
The Commission vote, including Commissioner J. Thomas Rosch, authorizing the staff to file the complaint was 5-0.  The complaint was filed in the U.S. District Court for the Northern District of Illinois, Eastern Division.
For more information about the case, in English and Spanish, consumers can call 202-326-2643.  To learn more about multi-level marketing, read the FTC’s Multilevel Marketing and  Business Opportunity Scams ( Estafas de Oportunidades de Negocio ).
NOTE:  The Commission files a complaint when it has “reason to believe” that the law has been or is being violated and it appears to the Commission that a proceeding is in the public interest.  The complaint is not a finding or ruling that the defendant has actually violated the law.  The case will be decided by the court.
The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC's online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics.  Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.
Frank Dorman
Office of Public Affairs

Allison Martin, Director of Communications
Kentucky Attorney General’s Office
Maura Possley
Illinois Attorney General’s Office

Noelle Talley, Public Information Officer
N.C. Department of Justice
David A. O’Toole
FTC’s Midwest Region

CNBC's Jim Cramer: Still denying the 'MLM' financial holocaust.

Today, a reader has made the following observation:

'Like most people I've never watched any financial television. I clicked on your links to some of the CNBC coverage of Herbalife.

This is similar to how journalists in Catholic countries covered child abuse in the Catholic Church.'


Although (to casual observers) this might appear to be a shocking, and unfair, comparison, I have to agree with it; for people who live in glass houses, do not generally throw stones.


Indeed, even now (with a few notable exceptions) mainstream financial journalists are not yet making a determined attempt to confront the true extent of ongoing 'MLM income opportunity' racketeering in the USA, let alone elsewhere: in essentially the same way that mainstream religious correspondents once ignored the extensive exploitation of vulnerable children, being deliberately-hidden by the sanctimonious hierarchy of the Catholic Church.

'Herbalife MLM Income Opportunity' racketeer, Michael Johnson.

As far as we know, the bosses of groups like 'Herbalife (HLF)' have not been covering up organized sexual, and violent, abuse, but these narcissistic racketeers (who have steadfastly pretended moral, and intellectual, authority whilst peddling a cruel illusion of a future Utopian existence), are undoubtedly guilty of organizing, and covering up, financial, and psychological, abuse on a scale which almost beggars belief.

At one time, I attracted a lot of unwarranted criticism for daring to label 'MLM/Prosperity Gospel' racketeering as an 'ongoing financial holocaust (with a small 'h') of which many people have been in denial.' 

However, how else can such a vast, and pernicious, blame-the-victim cultic fraud be accurately described? Remember, we are talking about a never-ending chain of tens of millions of vulnerable persons around the globe, currently being churned through a constantly-expanding number of essentially-identical, dissimulated rackets, annually. Indeed, the harder the world economic crisis has bitten: the easier it has been for the 'MLM' virus to spread.    

Readers should never forget that the various mainstream financial journalists who are still exhibiting confirmation bias by doubting Bill Ackman's accurate, but somewhat-mild, analysis of 'Herbalife' shares as being effectively-valueless, have enthusiastically promoted 'Herbalife' as being a sound and lawful investment, in the very recent past.

When the 'Herbalife' racket inevitably collapses, the likes of CNBC's Jim Cramer might be facing legal action (not least from any CNBC viewers who took his financially-suicidal advice and bought, or held onto, 'Herbalife' shares).

However, if Mr. Cramer (a wealthy, but controversial, author, former hedge-fund manager and graduate of the Harvard Law School) really has swallowed the absurd 'MLM Income Opportunity' fairy story (as recited by Michael Johnson and his crooked little pals): then he is almost-certainly not going to want to face ego-destroying reality. All the same, even though some naive people will say that Mr. Cramer is probably too stupid to be held fully to account, it would be very interesting to know exactly what this amoral loud-mouth's own financial, and/or personal, involvement has been.

It will come as no surprise to regular readers of this Blog to discover that anyone (with sufficient cash) can buy Mr. Cramer's energetic services (as a public speaker) for $50 000-$100 000.

David Brear (copyright 2013)

Sunday 27 January 2013

Introducing Tim Sales: the 'Herbalife' Lord Hee-Haw!

Very recently, a commentator on CNBC sniggered in disbelief as he himself made the somewhat elementary observation that:

'If 'Herbalife' is a fraud then so are many other 'MLM' companies.' 

However,  last summer another, smug, American financial journalist asked me:

'Are you seriously suggesting that the entire 'Direct Selling Industry' is a fraud?'

At that time, even in the light of the recent dramatic (33% or $1.7 billions ) fall in the inflated market-price of effectively-valueless 'Herbalife' shares (due to the incapacity of the company's senior officers to answer the most basic questions concerning external sales), this fellow still found it impossible to accept that, for decades, a growing number of gangs of sanctimonious racketeers behind so-called 'MLM direct selling companies' (like 'Amway', 'NuSkin' , 'Herbalife', 'Xango,' etc.), have successfully dissimulated vast, blame-the victim, closed-market swindles simply by supplying endless-chains of constantly-churning, ill-informed recruits with banal, but grossly-over-priced and, therefore, effectively-unsaleable, products, and/or services, enabling these racketeers to launder billions of dollars of unlawful losing investments (made on the false-expectation of future profits) as 'lawful sales (based on value and demand).'

It beggars belief that (to date) no one from the mainstream financial media has had the courage, or gumption, to go the grinning bosses of any 'MLM income opportunity' racket, look them directly in the eye and calmly keep asking them the following, blindingly-obvious question:

What quantifiable evidence can you produce to prove that your alleged 'direct selling company's' so-called 'Multi-Level Marketing income opportunity' has actually generated any significant revenue other than that deriving unlawfully from its own constantly-churning, losing-participants?'

To the majority of 'MLM Income Opportunity/Prosperity Gospel' adherents, this Blog, 'MLM The American Dream Made Nightmare,' is usually seen as being a 'Negative Website.' To the significant minority of intellectually-castrated 'MLM' core-adherents, my rational evidence-based analysis of 'MLM' as the technical-sounding, made-up name for a cultic, blame-the-victim racket, has been systematically dismissed as the irrational ranting of an obsessed critic who doesn't know what he is talking about. However, to the most-deluded, long-term 'MLM' fanatics, all free-thinking individuals and any quantifiable evidence challenging the authenticity of their delusional belief in 'future total financial freedom,' has been systematically categorized, condemned and excluded as absolutely evil.

David Steadson: The Unmasked 'Amway' Lord Hee-Haw

For years (as part of a wider, overall pattern of ongoing, major racketeering activity), the bosses of 'Amway' have sought to obstruct justice by hiding behind reality-inverting criminals who have steadfastly pretended moral and intellectual authority on the subject of 'MLM.'  Typically, of a cultic organized crime group, these provocative, de facto agents have posed as being independent of the leadership of 'Amway.' In reality, they have run various propaganda Websites and they have infiltrated countless other genuinely-independent Blogs and forums in a blatant attempt to disrupt free-debate and prevent 'Amway' victims from facing reality and complaining. This led me to label, David Steadson a.k.a. 'IBO Fight-Back', a.k.a. 'Insider', a.k.a. 'Icerat', etc. (the most-inflexible, and omnipresent, of these 'Amway' broadcasters): the Unmasked 'Amway' Lord Hee-Haw. At one time, this narcissistic little shit with a psychology degree posted a lengthy fairy story on the Net. in which he described the 'Internet War' being prosecuted against 'Amway' by the members of an international anti-capitalist cult.

Mr. Steadson has also repeated a familiar, and deeply-mystifying, financial fairy story. In brief, he has insisted that:

 'MLM schemes' can't be pyramid schemes, because the minority of active 'MLM Distributors' sell 'MLM' products to the majority of inactive 'MLM Distributors' who, therefore, shouldn't be counted as 'MLM Distributors' at all - these are 'MLM' customers. 

I quickly began to thank Mr Steadson and to invite him to keep up his efforts, because each time he opens his mouth and recites one of his predictable 'Amway' Calling , 'Amway' Calling scripts, he is merely proving the validity of every word I have published on this Blog!

Despite a growing mountain of other evidence confirming the accuracy of my analysis, there are still many casual observers of the cult phenomenon who (apparently in defence of their egos) simply refuse to believe that unsuspecting individuals can be tricked into entering a counterfeit culture in which their existing perceptions of right and wrong are overturned and made absolute, or that apparently rational persons can suddenly abandon all reason and allow themselves to be abused and exploited by cultic racketeers, whilst participating in the abuse and exploitation of others.

'Income Opportunity' schill, Dexter Yager (and spouse, Birdie ), preaching the kitsch 'MLM Gospel of Prosperity' by posing as ordinary, ignorant poor humans: turned enlightened, multi-millionaire super-humans. 

For decades, self-styled 'Pastor' Dexter Yager  (a former beer salesman), was one of  the small group of racketeers who continue to steal billions of dollars annually by peddling a never-ending chain of 'Amway' hopefuls, exhorbitantly-priced publications, recordings, tickets to meetings etc. , on the fraudulent pretext that these  'tools' contain vital secrets to 'buiding success' in 'MLM.'

'MLM' cultic racketeer, Mark Gorman

The following is a transcript of a brainwashing ‘tape’ entitled: ‘How to Handle Negative Websites’produced and distributed by the ‘InterNet Services Corporation,’ an organization which was registered in the USA as a ‘privately-controlled limited-liability commercial company’ (apparently independent of ‘Amway’), but owned by ‘Amway Diamond Distributor’,  Dexter Yager. 

(It is deeply-disturbing material like this which has produced, and maintained, the self-gratifying group-delusion controlling the personalities, and behaviour, of the most-inflexible 'Amway' fanatics):

‘I'm convinced more and more each day that this (‘Amway’) business was God's idea. What  I'm saying is God created this (‘Amway’) business so that we could pull families together and help people — and the Devil does not like that ! If you don't believe there's a Devil, go on the Internet  !  Man I'm telling you, there's a Devil ! The Devil does not like this (‘Amway’) business ! - He does not like the unity in this (Amway’) business ! All I want to say to you is:  guys, if I were the Devil and I saw a business that was keeping marriages together, where that men learned how to love their wife … they're taught from stage in Leadership sessions how to love their wife … where women are taught how to really integrate the marriage … the husband and wife relationship … where parents are taught how to bring up their children and encourage them to speak life and positive things into them so that those children have good healthy self-images and believe that they can really do anything that they put their minds to do .  If I saw a business that was responsible for holding those marriages and families together, and getting people out of debt, and learning how to treat people with dignity, respect and kindness … a business that gave people hope for freedom, hope for their financial future … that a person could not even succeed in this (‘Amway’) business without helping somebody else, and that the more people you help the more money you make… a business that teaches the principles of morals and ethics and integrity, that gives dignity to human life, that validates marriages an institution that should be reverenced that should not be put down or criticised or belittled .… If I saw a business that did all those things and so much more for humanity .… If I were the Devil, I'd hate it with a passion ! And I am convinced that not only does Satan hate the Church, I'm convinced with all my heart that Satan has good reason for hating this (‘Amway’) business. He has good reason for hating Dexter and Birdie and every Leader in their organisation. Satan hates this (‘Amway’) business with a passion, because this (‘Amway’) business stands for everything he hates ! And if you want to know whose behind those Websites, all I ask you is, who could it be… huh  ? … Could it be Satan ?’

Pastor Mark Gorman 2001

Robert FitzPatrick

Bearing all the above in mind, it becomes very easy to predict the reaction of the 'Herbalife' bosses to determined-challengers like Bill Ackman and Robert FitzPatrick.

Tim Sales: The 'Herbalife' Lord Hee-Haw

Currently, the bosses of ''Herbalife' are seeking to obstruct justice by hiding behind a reality-inverting criminal, Tim Sales, who steadfastly pretends moral and intellectual authority on the subject of 'MLM.' Typically, of a cultic organized crime group, this provocative, de facto agent is posing as being independent of the leadership of 'Herbalife.' 


The ironically-named Mr. Sales (a former sailor), is yet another absurd, but nonetheless dangerous, 'MLM' guru - i.e. an extremely greedy, but otherwise-mediocre, young fellow who has learnt how to dress-up and play the unoriginal, and profitable, role of ordinary, ignorant poor man turned enlightened, millionaire superman. His recent propaganda broadcast (in which he first denigrates Bill Ackman as a wealthy Wall St. shark feeding off the poor and ignorant, then libels Robert FitzPatrick by describing him as
 a hate-filled, fake, pyramid scheme expert and arrogantly instructs the independent media not to take heed of him), is a blatant attempt to prevent 'Herbalife' victims from confronting reality and complaining. 

Mr. Sales repeated a familiar, and deeply-mystifying, financial fairy story. In brief, he insisted that:

 'MLM schemes' can't be pyramid schemes, because the minority of  active 'MLM Distributors' sell 'MLM' products to the majority of inactive 'MLM Distributors' who, therefore, shouldn't be counted as 'MLM Distributers' at all - these are 'MLM' customers. 

Self-evidently, this broadcast by the narcissistic 'Herbalife' Lord Hee-Haw forms part of a wider, overall pattern of ongoing, major racketeering activity (as defined by the US federal Racketeer Influenced and Corrupt Organizations Act 1970). 

Thank-you, and keep it up, Mr. Sales!

Each time you open your mouth and recite one of your predictable 'Herbalife' Calling, 'Herbalife' Calling scripts, you are merely proving the validity of every word I have published on this Blog!

David Brear (copyright 2013)