May 16

On Tuesday, I joined the Federal Trade Commission (FTC) and the Attorneys General from North Carolina and Illinois in announcing a settlement that forces the operators of one of the most prolific pyramid schemes in North America to turn over $7.75 million to its former customers. The operators of Fortune Hi-Tech Marketing (FHTM), which was based in Lexington, Ky. and enrolled more than 350,000 consumers throughout the United States, Puerto Rico, and Canada in just its last four years, have also been banned from participating in multi-level marketing as a result of the settlement.

This was 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. Our lawsuit filed last year against FHTM alleged that the company lured people into its "network" with promises of big pay checks and dreams of becoming millionaires. However, our investigation showed what FHTM actually delivered was a massive alleged pyramid scheme that cost consumers millions of dollars.

Unlike legitimate multi-level marketing programs, FHTM distributors had no incentive to sell products. For example, an FHTM representative received pennies in commission for selling a three-year, $43 per month home security system. Meanwhile, representatives who attained a certain level within the company could receive $100 for every new member they signed up. The emphasis on recruitment rather than sales made this a pyramid scheme. Fortune Hi-Tech Marketing promised big returns, but instead delivered big losses to thousands of families across the country. My office is working with the FTC to coordinate a restitution plan for consumers who invested hard-earned money in a company that left them empty handed in difficult economic times. You can learn additional information about the settlement here.

Next week, investigators from my office will be patrolling precincts and polling places across the Commonwealth during Tuesday's Primary Election. We've been working closely with the Secretary of State's Office and other fellow members of the Kentucky Election Integrity Task Force to prevent vote fraud. As you head to the polls, remember you can help us in this effort by reporting any irregularities or possible election law violations to our Election Fraud Hotline at 800-328-VOTE (8683). The hotline is open from 6 a.m. to 7 p.m. (EST) on Election Day and available year-round. Working together, we can ensure a fair and honest election for all Kentuckians.