Brokers Gone Wild (Part 5)

December 3rd, 2008

In Part 5 in our review of how otherwise honest stockbrokers wind up selling financial scams, we are looking at a proven sales technique known as “The Test Drive,” and what it looks like in financial scams.

“You mean I can earn 10 percent per month in this investment?” you say.  “I don’t’ believe it.”  The scam artist is thrilled to hear it.  Read the rest of this entry »

Corruption Corrupts

December 2nd, 2008

Whether it’s aiding and abetting, looking the other way, or choosing to ignore red flags, a corrupt firm often leads to corrupt brokers. The same is true of a person in power. When a CEO or President operates fraudulent schemes, others are right behind him. And then it’s only a matter of time before it affects your account. Read the rest of this entry »

Brokers Gone Wild (Part 4)

December 1st, 2008

We are in the midst of a series of posts in which we are following the likely course of stockbrokers who find themselves out of a job and/or desperate for commissions.  We began with a look at why otherwise honest stockbrokers begin selling financial scams.  We are now in the midst of an examination of three of the common sales techniques that brokers will employ in convincing you to turn over all or part of your nest egg to what you will learn, too late, is a financial scam.  In Part 3 we examined ‘The Qualify Pitch.’  Today we take a look at the sales technique known as ‘The Take Away Pitch.’  Read the rest of this entry »

Brokers Gone Wild (Part 3)

November 28th, 2008

The Qualify Pitch, the Take Away Pitch, and the Test Drive  They are only three of the many sales techniques stockbrokers and scam artists will use to take your nest egg, or at least a good portion of it, away from you.  In each of the next three posts in this series, we will examine each of them in turn.  Soon-to-be unemployed and/or desperate brokers who turn to selling financial scams will likely use at least one - and probably all three - of them eventually. Read the rest of this entry »

Brokers Gone Wild (Part 2)

November 26th, 2008

The central feature of the scam that will destroy your nest egg?  Safety.

You will learn about it from someone you trust.  It will promise guaranteed returns.  You will see it work with your own eyes.  And, when all the smoke has cleared, all of your money will be gone. Read the rest of this entry »

It’s A Long Process

November 25th, 2008

The Securities and Exchange Commission (SEC) filed an enforcement action against Jack A. Calvin in March of 2003 and obtained a default judgment in December of 2003.  The Court found Calvin, of Ozark, Missouri, liable for securities fraud and ordered him to pay  $6,114,283.    Read the rest of this entry »

Brokers Gone Wild (Part 1)

November 24th, 2008

If you haven’t believed me yet, please believe me now.  You are in danger; danger from your stockbroker, danger from a broker you haven’t yet met, danger from friends and family who fall prey to such a broker and convince you to follow them.  Over the next week or so, we will follow the course of how the obliteration of a nest egg begins and how it ends.  Read the rest of this entry »

Unauthorized Trading (Part 3)

November 21st, 2008

How should you respond when your broker makes a trade without your permission?  There is only one thing to do.  You must report the unauthorized trade immediately to the broker’s branch manager and to the firm’s compliance department, and you must do so in writing.

Be very careful; the broker will ask you to delay reporting the trade.  He will say something like, “Let’s give it a day,” or “Let’s give it a week,” asking you to wait and see whether the unauthorized trade will become profitable.  The broker may even beg you not to report the unauthorized trade, asking you to think of his family.  But any delay in reporting the trade will look like a ratification of the trade.  Do not let the broker convince you to wait. Read the rest of this entry »

It’s Still Going On

November 20th, 2008

You may think that the Nigerian e-mail scam is a thing of the past.  Since there’s been so much education around it, surely scamsters would have run out of easy targets.  But according to a recent article from the Associated Press, the opposite is true. Read the rest of this entry »

Unauthorized Trading (Part 2)

November 19th, 2008

Unauthorized trading is rampant.  If a broker gets caught doing it, even once, he’ll likely be fired and maybe barred from the securities industry.  So, why do they get away with it?  Two reasons. Read the rest of this entry »

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