Lt. Gov. Andre Bauer’s Chief-of-Staff is a veteran of several “multi-level marketing” (or MLM) businesses, according to documents obtained by FITS.
In fact, former Secretary of State Jim Miles and his wife Betty have reportedly made millions of dollars off of these companies, which critics insist are nothing but elaborate pyramid schemes that rip off thousands of unsuspecting citizens.
The latest alleged scam involving Miles and his wife is Fortune Hi-Tech Marketing (FHTM), a Kentucky-based firm that claims to be a “leader in the industry,” although what that “industry” is appears to be somewhat murky.
Ironically, Miles association with this company began circulating in S.C. political circles only after a “scam alert” warning people about FHTM was posted on the Lt. Governor’s Office on Aging website.
“My wife was recently approached by a friend about joining a network marketing group called Fortune Hi-Tech Marketing (FHTM),” the post reads. “She was told that she could make a significant amount of money if she joined and was invited to attend a meeting about the ‘opportunity’ at a friend’s house.”
Heard this pitch before?
It’s eerily similar to the one that suckered hundreds into Burn Lounge, a music sharing outfit that was recently exposed as a pyramid scam – or a business model that achieves the majority of its profits by signing up new “investors” rather than producing a legitimate good or service.
In many pyramid scams, a low-cost good or service is offered as “cover” for the true profit-generation device – which consists of referral fees from new members.
“(My wife) asked for some additional information about the ‘opportunity” and was told that it would cost $299 to become a member and that she could make money by selling products online and by signing up friends to become company representatives,” the post on Bauer’s website continues. “She declined to attend the meeting and expressed concern that the “opportunity” might actually be an illegal pyramid scheme.”
Miles’ connection with Fortune Hi-Tech Marketing is documented here.
The company vigorously defends its reputation, pointing to an infomercial that aired on FOX News in which it was ostensibly endorsed by Forbes.
Forbes has never endorsed the company, however, and statements of FHTM’s legitimacy seem to come exclusively from its “top earners” and an army of Internet trolls who constantly scour the web for any mention of the company’s name.
Whenever FHTM is mentioned on the web, almost immediately anonymous testimonials touting the company’s legitimacy begin popping up – which as far as we’re concerned only adds to the “shady factor.”
FHTM would not be the first questionable business model that Miles and his wife have been associated with.
The couple were also ground-floor “top sellers” in Excel Communications, which went bankrupt in November 2004.
At the time Excel went under, only 99 of its 106,426 U.S. “representatives” were making more than $1,000 a month.
The rest?
They were paying the freight for those 99 “top sellers,” including Jim and Betty Miles – both of whom not only profited from but extensively promoted Excel (click here and here).
Needless to say, Fortune Hi-Tech Marketing has not earned a “Senior Scam” seal of approval from the Lt. Governor’s Office, which is surprising.
We figured one good scam would “deserve another.”
By Rick April 7, 2009 at 11:18 am
This is disturbing. There are a certain sect of people in society who make their money by getting involved in these MLM businesses. It’s usually shady and sometimes cult-like among the couples who do this stuff. I am surprised our former secretary of state is involved in this stuff.
Do the Miles’ also own a bail-bond agency or are they friends with the Irish Traveller gypsy’s in Aiken County?
By Snead April 7, 2009 at 11:43 am
So this scam draws critical attention but predatory lending deserves a pass? Make up your mind. Or how about some of that transparency for your client list?
By Shark April 7, 2009 at 11:58 am
and why is bauer still keeping Miles around?
By fitsnews April 7, 2009 at 12:03 pm
Snead-
That’s it … pop the messenger. All you did was validate us, dude.
-FITS
By Cliff April 7, 2009 at 1:42 pm
I can’t believe that Jim and Betty Miles have not signed up for Senior Shield. If they want others to give money to the state in order to be investigated, they should submit themselves to the same expense and scrutiny.
By Rick April 7, 2009 at 2:57 pm
Who goes from being a Secretary of State to failed candidate for governor to chief of staff for a Lite Gov? And aren’t there like tons of younger GOP politicos in this state who would enjoy pimpin Andre’s agenda other than some washed up old guy politician?
By Snead April 7, 2009 at 3:28 pm
Why not put the cross down for a second and explain how one crooked industry earns your protection while the other catches your scorn? Just curious.
By Um, no April 7, 2009 at 6:13 pm
That Snead asks good questions. Are you going to answer him or just continue the usual smart-ass sidestep? Not much doubt about that one.
By James the Foot Soldier April 7, 2009 at 8:13 pm
How about an expose on the LARGEST Ponzi scheme ever run – run by the United States Government no less:
SOCIAL in-SECURITY
Illegal if not legislated legal.
By Paull April 8, 2009 at 12:42 am
This is very disturbing. People who don’t understand how network marketing really works seem to feel compelled to call it a scam. The industry has been in existence for over 50 years and has been a source of legitimate income for countless numbers of people. The industry isn’t for everyone just like flying a jet plane isn’t for everyone. That doesn’t make it evil!
I highly recommend you sit and talk with FHTM founder Paul Orberson. Discuss your concerns with him and get if from the horse’s mouth. It’s easy to criticize from afar. Get yourself down to Lexington, KY and talk to the man! I DARE YOU!!!! Add some legitimate content to your articles.
By bob April 8, 2009 at 6:29 am
Let’s cut to the chase:
Does FITSNews or any of it’s employees, owners or relations take money from anyone connected to the payday lending industry?
Just so we are clear about things.
By baker April 8, 2009 at 9:34 am
Fascinating to read this story on this blog….after all, the AMWAY folks are HUGE into the private school choice movement. Major, major players.
Here’s what an Education Week article reported:
http://www.edweek.org/ew/articles/2006/09/27/05politics.h26.html
“Mostly financed by a handful of mega-rich entrepreneurs — including the founding families of Amway Corp. and Wal-Mart Stores Inc. — All Children Matter is becoming an influential political arm of the school choice movement….
The national group and its network of local political action committees are targeting not only Utah this year, but also Colorado, Florida, Indiana, Missouri, SOUTH CAROLINA, and Wisconsin—states where they were active during the 2004 elections….
All Children Matter is a small political action committee with a big bank account. The group was started in 2003, three years after a state voucher initiative failed in Michigan. That effort was led by former Michigan state GOP Chairwoman Betsy DeVos and her husband, Dick DeVos Jr., who is running for governor in Michigan this year against Democratic incumbent Jennifer M. Granholm.
Mr. DeVos, whose family made its fortune with the Amway company, originally known for direct sales of cleaning products, was the founding chairman of All Children Matter before stepping down to run for governor. Betsy DeVos is now its chairwoman.
‘I don’t think there’s anything they wouldn’t have done to defeat me,’ Mr. Cox (a former legislator in Utah) said. He said the group’s local affiliate sent out a postcard that seemed to twist a vote he cast on a resolution urging Congress to help children of illegal immigrants. Mr. Cox said he was painted as a supporter of illegal immigration. ‘I think they’re unscrupulous,’ he said. Mr. Cox was elected in 1998 and has since worked against school vouchers.”
I wonder how much money SCRG receives from the Amway honchos?
By cgi-bin laden April 8, 2009 at 9:53 am
Excel Communications? Haven’t heard of them in a while. If he was in any way associated with that outfit, then he’s a crook.
By cgi-bin laden April 8, 2009 at 9:57 am
BTW, how is shit like FHTM even legal in this state?
SECTION 39-5-30. Pyramid clubs and similar operations declared unfair trade practices.
Any contract or agreement between an individual and any pyramid club, or other group organized or brought together under any plan or device whereby fees or dues or anything of material value to be paid or given by members thereof are to be paid or given to any other member thereof, which plan or device includes any provision for the increase in such membership through a chain process of new members securing other new members and thereby advancing themselves in the group to a position where such members in turn receive fees, dues or things of material value from other members, is hereby declared to be an unfair trade practice pursuant to Section 39-5-20 (a) of the South Carolina Unfair Trade Practices Act of 1971.
Last time a “friend” of mine tried to get in me one of those MLM scams, I just sent that to him and told him if he ever called me again I was contacting the AG’s office. Never heard from him again.
By Glutton April 9, 2009 at 12:06 am
Um, is it me, or does all this sound a whole lot like the giant pyramid Speaker Harrell and Senator Leatherman are pitching with Dan Cooper and Glenn McConnell and a bunch of rich university elites? Their plan is in fact a pyramid, and somewhere a few people are getting rich off it. But no one can show any actual products or jobs from it, nor has it generated any income.
Lots of high-priced consultants are being paid to pitch it. And even though they’ve gotten all this money, no one is actually doing anything. Sound familiar?
Jim Miles’ little crooked cons are nothing compared to the “economic development” government gravy train. Talk about a scheme. And we are at the bottom paying for it.
By Markopolos December 17, 2009 at 3:24 pm
North Dakota Attorney General Vs Fortune HI-Tech Marketing
Fortune HI-Tech Marketing ordered to stop doing business in North.
Cease & Desist report against FHTM
http://www.ag.state.nd.us/documents/FortuneCeaseandDesist.pdf
By Mat January 21, 2010 at 12:01 am
Wow. My brother was given the speech to join up with these guys by his boss! LOL. I was recently, but with another product, by a ‘doctor’ client of mine. I found out a few days later that this ‘doctor’ took up this ‘business’ because he lost his license due to malpractice.
I can smell the ‘networking’ a mile away. For all of you who claim “OMG none of you know anything” or “I suggest you just have a conversation with the CEO of this company” … BS … how about you give me $299 and I’ll send you on your way with another “good idea” to make a billion dollars a week that will never work. If your that naive, hand over the cash. 97% of new recruits quit within a year. The big dogs make money from your $299 dollar sign-ons, not from the actual products sold. That’s where the money is made.
Here’s another thought, you MLM supporters; I work for a very reputable company that has been around for over 100 years and even helped to get the entire US out of the depression. I make a very nice salary and have invested in REAL assets over the years. Stocks, Bonds, Real Estate. Assets generate income. And soon, my assets will generate enough income to support my lifestyle with out me having to work at all. That’s the smart way to become wealthy.
Back to the point. My company, and ANY reputable company wants to hire great employees that will last. There is an application process, an interview process, a training process, a probationary period, THEN and only then if you are good enough, the company will keep you around.
MLM’s don’t care who works for them at all. Their so-called employees have to PAY a sign-on fee to work for them? You can be a serial killer, or a child molester and you can still work for MLM’s. And interestingly enough, MLM’s will never FIRE you. IF that company was worried about reputation, and was a legitimate company, don’t you think they’d NOT allow just anyone to work for them?
No matter your supportive opinion of MLM’s, they are only legitimate because the people they bribe to work for them are naive and/or desperate, and sign-on and pay the fee with NO contracts signed. With out a contract, nothing will hold up in court. AND the money is given freely by the giver, so the giver has NO backup on anything and will never recoup that fee.
Another note. Have you seen this company’s website? I’ve seen teenagers design and maintain better looking, more professional websites that this.
Get a clue ppl. If not, just send me your check. I’ll donate it to a church and put it to good use.
Don’t feed the fat cat with your hard-earned money, you skinny runts. Invest your money, and your dollars will be your employees for the rest of your life, and for generations to come.
By Mat January 21, 2010 at 12:06 am
Here’s one last point. On their website under “Contact” it reads: For more information, get in touch with the person who sent you to this site. Hmmm… more than likely, that person I’m going to call JUST signed on him/herself. What kind of answers would I really expect from that person? I vote USE YOUR BRAINS for once.
By Carlos April 29, 2010 at 4:22 pm
The information and comments being posted here are incredible. Most of the comments posted are by people that either don’t understand or have very little knowledge and experience about FHTM or Paul Orberson. I’ve been with FHTM and I have made good money. It’s not a get rich quick scheme, it’s not a pyramid scheme. In fact, we have thousands of partner companies like Walmart, Target, Best Buy, Home Depot, Pep Boys, Chili’s, Amazon.com, Dish Network, Apple, Sprint, AT&T, T-Mobile, Nextel, etc…the list goes on and on.
You people are ignorance mongers and perpetuate stupidity, those that criticize FHTM. There are illegal MLM’s but FHTM is not one of them. There are reputable companies like Amway, AVON, Mary Kay.
This in legal in ALL 50 states, the UK, Canada and Puerto Rico. So get your facts straight.
By Dean May 24, 2010 at 10:00 am
Here is some information that I found about FHTM.
The first website is info about FHTM getting banned in Montana and ordered to pay $1 million back to the residents of the state. According Montana state law, the courts found FHTM was guilty of running a pyramid scheme.
http://www.ripoffreport.com/multi-level-marketing/fortune-hi-tech-mark/fortune-hi-tech-marketing-fhtm-be4b5.htm
Second website is has the video of live news coverage on the courts ruling FHTM as nothing more than a pyramid scheme.
http://mlmblog.net/2010/04/fortune-hi-tech-montana-pyramid-scheme-video.html
By Paulie Morehouse June 22, 2010 at 12:55 pm
Whistleblower fights back after frivolous suit by FHTM for exposing their ILLEGAL Pyramid Scheme
Lexington, Kentucky – June 16, 2010 – In light of all of the recent investments scams including the infamous Bernie Maddoff, whistleblowers and those with morals fear that the frauds they expose will result in unjust lawsuits filed against them by the companies they complain about. One such situation was that of the lawsuit filed by Fortune Hi-Tech Marketing against Fortune Social LLC and Joseph Isaacs in May 2010.
Joseph Isaacs and Fortune Social, LLC (collectively “Isaacs”) deny each and every claim brought by Fortune Hi-Tech Marketing, Inc. (“FHTM”) in a filing made today with the American Arbitration Association, who is overseeing this case. In addition, Isaacs fights back and asserts his own counterclaim for relief against FHTM, Paul C. Orberson (individually and in his capacity as President of FHTM), Jeff Orberson (individually and in his capacity as Chief Operating Officer of FHTM), and Thomas A. Mills (individually and in his capacity as Vice-President and Chief Executive Officer of FHTM) (collectively “FHTM”). Isaacs counterclaim claim Breach of Fiduciary Duty, Breach of Contract, Common Law Fraud, Unfair & Deceptive Business Practices, Failure to Register Securities, Fraudulent Practices Regarding the Sale of Securities, Civil Racketeering Conspiracy (violation of the Federal RICO statutes) and Defamation.
FHTM operates an unlawful product-based endless recruiting pyramid scheme that relies on untrue and misleading representations and unlawful, unfair, and fraudulent business practices. While FHTM purports to be in the business of selling name-brand services like wireless, satellite television, home security, vitamins, nutritional products and travel services, its true business is using consumers to generate fee income for representing non-existent partnerships, major sports figures, and prominent businessmen. To entice consumers to participate, FHTM makes untrue or misleading claims regarding its relationship with Fortune 100 companies like Verizon Wireless, GE Security, Dish Networks and Travelocity to create the illusion that consumers can become millionaires in three to five years.
FHTM’s growth exploded when it began to lure consumers disenchanted with traditional jobs and the recession that began in 2007 to inspirational and high-pressure business opportunity seminars touting an innovative business model that promises huge financial rewards through multi-level network marketing. FHTM erring presenters claim to have proprietary tools, special relationships, and other support that allow consumers to grow their own business by partnering with FHTM’s “companies”.
It would not be long before Isaacs (and the world) made several troubling discoveries about FHTM’s business plan and practices that doused his enthusiasm: (1) Paul Orberson had not made any special arrangements with the companies mentioned at the business opportunity/presentation seminar or in the company produced videos; (2) the only way to earn a significant income and be promoted up the ranks was to recruit additional IRs; (3) FHTM had not received regulatory approval for its pyramiding scheme in every state; (4) only a handful of IRs had earned anywhere near the residuals projected; (5) the prominent businessmen, politicians, former attorney generals and sports figures to whom FHTM constantly alluded were in fact IRs actively promoting their own FHTM business; and (6) a growing number of state attorneys general had already begun investigating FHTM in response to numerous complaints.
It turns out that FHTM’s ‘innovative’ marketing plan is nothing more than a face lift to an age-old scheme. According to the FTC’s Consumer Protection Bureau:
Pyramid schemes now come in so many forms that they may be difficult to recognize immediately. However, they all share one overriding characteristic. They promise consumers or investors large profits based primarily on recruiting others to join their program, not based on profits from any real investment or real sale of goods to the public. Some schemes may purport to sell a product, but they often simply use the product to hide their pyramid structure. There are two tell-tale signs that a product is simply being used to disguise a pyramid scheme: inventory loading and a lack of retail sales. Inventory loading occurs when a company’s incentive program forces recruits to buy more products than they could ever sell, often at inflated prices. If this occurs throughout the company’s distribution system, the people at the top of the pyramid reap substantial profits, even though little or no product moves to market. The people at the bottom make excessive payments for inventory that simply accumulates in their basements. A lack of retail sales is also a red flag that a pyramid exists. Many pyramid schemes will claim that their product is selling like hot cakes. However, on closer examination, the sales occur only between people inside the pyramid structure or to new recruits joining the structure, not to consumers out in the general public.
Nonetheless, the truth is catching up with FHTM. On December 10, 2009, The North Dakota Attorney General’s Office filed a Cease and Desist Order for violation of the Consumer Fraud Law, the Transient Merchant Law, the Home Solicitation Sales Law, and the North Dakota Pyramid Schemes Act. On January 19, 2010, FHTM entered into a Assurance of Voluntary Compliance with the North Dakota Attorney General’s Office. On March 16, 2010, the Montana State Auditor’s Office filed a Temporary Cease and Desist Order against FHTM, Paul C. Orberson, Thomas A. Mills, and Dianne Graber (a Montana IR). According to the Montana State Auditor’s Office, FHTM has engaged in acts or practices constituting violations of the Securities Act of Montana, Montana Code ANN.30-10-101 et seq. On April 22, 2010, FHTM agreed to pay nearly $1 million and to change its business practices to resolve the charge that it is operating a pyramid promotional scheme.
With each passing day, more states are jumping on FHTM’s bandwagon. The alarming rise in consumer complaints and governmental sanctions has prompted the Better Business Bureau of Central and Eastern Kentucky to downgrade FHTM’s rating from “B-” to “F”. At the same time, a proliferation of online bulletin boards and blogs, such as http://www.complaintsboard.com and http://www.scams.com criticize FHTM’s pyramid scheme confirms that Isaacs’ experience is not unique. Will those operations be the next target of Fortune’s high price legal team?
By Kurt August 1, 2010 at 5:13 pm
FHTM is OPEN FOR BUSINESS IN MONTANA!!! The Government checked them out top to bottom and they are clean! That really says that FHTM is a legit company if they have been inspected and passed with flying colors.
By Douglas - MLM January 11, 2011 at 2:00 pm
One interesting fact though is that the formal Distributors for company like FHTM are the one making the FHTM scam allegations. They are doing this mostly because they failed in the business.
Doug