Day, et al, vs. Fortune High Tech Marketing

It's about time someone stepped up to the plate to try and take down this pyramid scam. We support your efforts 100% Dinsmore.

Excellent article Kevin! The allegation that FHTM is a pyramid scheme has in no doubt crossed everyones mind since the focus of many distributors is recruiting and becoming your own customer to qualify for the bonuses, at least, that is how they operated for the past 9 years.

I noticed in your comments the discussion over commission on training. First we can all honestly tell by the past cease and desist orders and recent troubles FHTM is in, that the training is not helping many distributors ethically. As far as the training fee, Reps can call it whatever they want with substituted words like “service rendered” or “training fee”, but once you accept the right to earn commission after training someone, it’s still a commission. FHTM's P&P calls it additional income or a one-time payment and labels the section (FHTM Field Training and Compensation). You can receive $40 when you are a Trainer coach and for an additional $200 you can become a Certified Regional Trainer (CRT) and earn up to $80 for every Trainer Coach you train with an annual renewal of $100. Then you can earn $40 to re-train a Trainer Coach after renewal. All covered in FHTM’s P&P Section 5 which better explains what I would consider their questionable activity.

Kevin, you are right in that what is considered a sales aid one should not earn commission on, such as the training with FHTM.

Lee,

Whether it's a "fee" paid by the company or a "commission" does not change the analysis: there's arguably a reward for recruitment and the training mechanism is really a token item designed to conceal a transfer of money between participants. That's the argument, I'm not saying it's accurate because I honestly do not know.

Interesting question, Lou. And I checked out your site. Wow, there really is a big debate going on over there! I had not considered the angle you're suggesting. If the commission for training people only goes one level deep, they're more like affiliate marketers. So when they sell products and services, they're network marketers. When they offer training, they're affiliate marketers and not subject to the MLM legal requirements. FHTM will certainly make this argument. In my opinion, assuming this is the setup, it will not provide a good defense. The plaintiffs will probably put on proof that the majority of people are pressured to pay the training fee, which is one of the main drivers of the compensation plan. And then they'll put on proof that despite the extensive training that occurs (to the tune of millions of dollars in training fees), the results are simply not there. Granted, it's not fair to pursue a company because the majority of people lose money. However, it will be an issue in this case because it's being alleged that there's considerable pressure on FHT reps to pay $400 in training fees in order to advance their businesses. The fact that this training program is sponsored by the company makes this much more complicated for FHT. With Amway and other companies that allow the field to sell tools, the reps themselves do the training and they sell the tools. The incentive to train in every other business in the industry is simple: increased product sales. With FHT, there's an added incentive to train: training fees. It's a strange case, no doubt.

I am enjoying seeing legal issues being discussed and not just someone yelling and sceaming nonsence on here.

I have been keeping up with this story for awhile now and have seen some things that I felt were very illegal when I looked at this a couple of years ago. My friend did sign up and I have watched this unfold into these mess.

I am very concerned with how many companies have been dropped after people have signed contracts with them for services and now no longer get points. Example, GE security. She got a system put in a few months ago with a two year agreement and now as of this month will no longer get those points and will be paying for something that she was banking on getting her ahead in her points. The reason the company left is because they did not have a contract with Fhtm and did not want to be anywhere around them with the Montana cease orders.

Then there is Peter Lamas. Again they dropped them supposedly because they could not keep up with orders and FHTM has told everyone that they could not get finacing and offered to buy them and Lamas said no. I have a very hard time believing this story. The timing was to close to the cease orders and I personally feel that they had issues with them being labled as an illegal pyramid.

Either way she had a month of having to order more stuff so she would not miss out on her checks. I dont believe fhtm gave any grace period on getting these replaced either.

She is a yound girl and spending more than what she needs to get these points. Who can honestly afford to sell shampoo at $20 a bottle and make less that a dollars?

Then there is the issue of trainings. I tried to talk her out of becoming a trainer. Something just did not feel right. I went with her to a training and it was just a long meeting. You dont recieve anything as far as addition training on products or get any new info other than how to bring more people in. After the meeting is when the pressure was put on as to how easy this was to train and how she could make hundreds in a day if she trained several people in one day. She opted to do it. Once she was trained to do this she recieved no work books, no DVD, no anything to help her give these meetings. When I heard that her boss was getting an override on every training she did and his boss got a bonus ect, I knew then that this was bogus. That is an illegal pryamid. Plus as she tried to train her people under her she was finding out that others above her were going and training these people behind her back. It was a fight all of the time over who owned whose people. It was a joke. So much for the nice Chritian people wanting to help you succeed!

Now that she has been in for a year and is up for renewal she is not going too and neither is anyone that she signed up. There is just way to much going on legally with this company. Who can afford to move up in the company and chance getting served as these other people did?

She did make money, but truthfully it was all on recruiting. Her commissions checks are very little.

I ask all of you who are defending this company to ask yourself honestly if you were not getting these hugh bonus checks versus simply getting the commissions check would you still be with them?

I feel for everyone who has built their dreams on this company as my friend has. Just as everyone believed in Bernie Maddoff and Ennron, those companies paid out high checks until the house of cards came tumbling down. The goverment was not who found out it was people on the inside who finally came out and told the truth. Sadly some even killed themselves because they could no longer live with the knowlege they had hurt so many to gain their fortunes.

In reading the court papers I see where they say the magazines that were used to recruit , Success at Home and others , were all paid for propoganda. This has got to be fraud. My friend swears that they did not because Paul would never lie.

I dont know how long it is going to take her to come back to reality but when she does it is going to be really painful to see someone she idoled be shown as the bad guy I believe he is.

Thank you for your good legal banter on here.

a friend, those GE Home Security points will pay for the legnth of the contract which is 2 years.

When I joined the Army in '01 at 18, I got a rank advancement (higher pay grade) for getting 2 buddies to join with me. The offer was repeated to them as well. Isn't that a pyramid? O.o