Jan 28, 2013 7:23 PM

Major UK Athletics Donor Accused of Running Pyramid Scheme Out of Lexington

A major donor to UK athletics is accused of running an international pyramid scheme from Lexington. Attorney General Jack Conway says Fortune Hi-Tech Marketing has potentially cost people hundreds of millions of dollars.

At 10:00 am Monday, members of the AG's office and the Federal Trade Commission seized the company's headquarters in Lexington and the warehouse in Boyle County.

"We think today's actions are the beginning of the end for one of the most prolific pyramid schemes operating in North America," said Jack Conway, Kentucky's Attorney General.

A Lexington police cruiser was parked outside Fortune Hi-Tech's corporate office on Corporate Drive. Federal officials seized the company after they filed a lawsuit last Thursday alleging the multi-level marketing company was a scam.

It's a fall from grace for the company's president, a marketing legend in the Bluegrass, and the Vice President Thomas Mills. Paul Orberson, a multi-millionaire from Danville, founded FHTC in 2001. The big-time athletics booster made headlines in 2010 when he pledged the winning bid of $98,000 to have dinner with Coach John Calipari and Ashley Judd for a Hope for Haiti fundraiser. He also pledged $1.6 million to add football offices in his name to the Nutter Training Facility in 2002.

But the Attorney General's office says they got dozens of complaints about Orberson's company, and legal action was taken in other states in 2010. Those were settled. Federal officials say 100,000 people were involved in the scheme that rewarded recruiting, not sales.

"No matter how hard you work or have worked there's very little chance people can break even," explains Steve Baker with the FTC. "In fact, people are doing their best. The plan is set up so 96% of people must lose money to keep this whole enterprise functioning."

A call to Fortune Hi-Tech Marketing's corporate office leads to a voicemail where their stance is made very clear.

It says in part:

"We are confident our side of the story will be heard, and we are already making confident strides to re-opening...While operations are now temporarily suspended, we truly expect to be vindicated."

Orberson has a Twitter account. The last public tweet he made was on January 26th, and it quotes Charles Darwin saying, "It's not the strongest of the species that survives. Nor the most intelligent. It is the one most adaptable to change."

The allegations are a Class C felony and they can carry a five to ten year sentence, but it's up to the Commonwealth's Attorney to decide to file charges.


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