Legal

News about pyramid-scheme related lawsuits and legal decisions.

Fortune High Tech Rests in Peace while Zombie MLMs Stalk the Public

by Robert L. FitzPatrick, Pres. Pyramid Scheme Alert The popular and fast-growing multi-level marketing company, Fortune High Tech Marketing (FHTM), is now officially dead. A few of its top leaders are banned “for life” from participating in MLM companies and were required by the FTC to pay back millions of their ill-gotten gain. “In recent years, the scheme targeted Spanish-speaking and...

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White Paper Examines MLM Legality and Economic Legitimacy

The two top legal experts in America on pyramid schemes, attorneys Douglas M. Brooks and Bruce Craig, carefully researched and evaluated the federal court cases that define and outlaw pyramid selling schemes under Section 5 of the Federal Trade Commission Act. They applied these cases to the widespread practices of MLMs today to evaluate MLM legality. This is the most in-depth and current...

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2012 Round-Up: Crimes, Misdemeanors and Charges in Multi-Level Marketing

In 2012, there were several publicized events that, along with other similar events over the least several years, indicate pervasive fraud in the multi-level marketing field and call out for a new and comprehensive investigation of this industry by regulators at the FTC, SEC, state Attorneys General and the new Consumer Financial Protection Bureau (CFPB): Medifast Diet Deceptions: In September ,...

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Is Wall Street Waking Up To MLM’s Flawed Business Model?

A highly unusual event occurred in May, 2012 that drastically affected businesses and individuals who invest in the stocks of multi-level marketing (MLM) companies. A hedge fund manager – who is famous for rigorous research, uncanny insight into future trends and for selling “short” the companies that he thinks are unsustainable – publicly asked a few pointed questions about the MLM...

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Half of Amway’s Products Are Retailed. Really! Plus Other Wacky Numbers

In a recent video interview with Amway executives, Doug DeVos and Steve Van Andel, a Wall Street Journal reporter asked them a probing and revealing question. In fact, before the interview, the reporter for the Wall Street Journal emailed Pyramid Scheme Alert to ask for questions to pose to Amway’s top executives. The question that Pyramid Scheme Alert recommended and that was asked was,...

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A European Court Rules: “Herbalife Is an Illegal Pyramid Scheme”

There are two icons of MLM that represent all the others of that “industry”. They are among the oldest and largest MLMs, and they have spread to most other countries worldwide. One is Amway. The other is Herbalife. Herbalife has just been ruled an illegal pyramid scheme by a court in Belgium. A case had been brought against Herbalife in Belgium by a non-profit consumer protection...

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Texas AG Forces MLM, Fortune High Tech Marketing, to Pay Refunds

Fortune High Tech Marketing (FHTM), the darling of the multi-level marketing industry when it was launched by former recruiters of the bankrupt MLM, Excel Communications, has been hit by regulators in yet another state. Texas consumers who were involved in the scheme may be entitled to refunds, totalling more than $1.3 million. The company has also agreed to pay hundreds of thousands of dollars...

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Is Social Security a Ponzi Scheme? Pyramid Scheme Alert Answers: NO!

Since its founding 11 years ago, Pyramid Scheme Alert has battled an epidemic of Ponzi and Pyramid Schemes in the USA and internationally. The schemes operate as multi-level marketing, home-based businesses, gifting clubs, investment schemes, buying clubs and under other disguises. Our Directors, Advisers and supporters have researched and analyzed pyramid schemes and have worked to clarify what...

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Is Social Security a Ponzi Scheme?

By Robert L. FitzPatrick, President of Pyramid Scheme Alert, with the Assistance of Pyramid Scheme Alert Directors and Advisors. A presidential candidate charges that the American Social Security system is a “Ponzi scheme” not long after the largest Wall Street Ponzi scheme in history collapsed and wiped out pensioners and charities. Pundits loudly argue the candidate’s claim but almost none...

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FTC Neglect and Corruption

Consumer Report Now Available: The Main Street Bubble The new report from Pyramid Scheme Alert, “The Main Street Bubble: A Whistle Blower’s Guide to Business Opportunity Fraud; How the FTC has Ignored and Now Protects It” is now available to the public at no charge. If you have an interest in seeing this report, email PSA. Include the words “Main Street Bubble” in...

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