Former UGA Coach Accused of Operating a Ponzi Scheme

‘Expert’ analyses and saw-it-with-my-own-eyes observations are worthless until you have done so.

If you sell a car or a television on Craig’s List and the buyer isn’t happy, there isn’t much he or she can do.  You don’t need a license to sell your old car or your old television, and the damage is limited to the price of what you sold. If you are selling investments that meet the legal definition of a “security,” though, you have to have a license, because the damage you can do by selling securities can last for generations. (more…)

One for Hollywood

Reading compelling stories about financial scams can actually innoculate you against fraud, recklessness, and incompetence in a way that no list of “do’s and don’ts” ever can.

I love heist films and movies about the long con. Because it’s my business to sniff out investment fraud, and because I’ve sat behind the desks of many Ponzi scamsters, I’m in a position to know whether the filmmakers get the details right. Nurses often hate watching medical dramas because they often get the medical details wrong, and lawyers are frustrated with legal dramas when the “lawyers” get away with questions and tactics that would never fly in court. (For an entertaining and accurate courtroom scene, watch the Coen Brothers’ remake of True Grit). But I am rarely frustrated watching movies about the long con. The filmmakers get it right. The truth is so vivid and audacious that Hollywood has no need to take poetic license with what actually happened. That’s why I expect to see a movie soon based on a story that Forbes picked up from the South China Morning Post. It reads, in part, as follows: (more…)

SEC Halts Alleged Ponzi Scheme with a Chinese Connection

The mere mention of a Chinese connection creates a gravitational pull that many prospective investors find hard to resist.

Last week, the U.S. Securities and Exchange Commission (SEC) commenced an emergency enforcement action in Texas and succeeded in freezing the assets of a company the SEC believes is engaged in an $8.6 million Ponzi scheme with claimed connections to China.  Specifically, the SEC obtained an order freezing the assets of  China Voice Holding Corp., “which trades in over-the-counter markets and has claimed to have a portfolio of telecommunications products and services in both the U.S. and China.”  The named defendants in the SEC’s case include Donald Ronald Allen, China Voice’s former CFO, and Allen’s associates, Alex Dowlatshahi and Christopher Mills.  According to the SEC, the three promised investors a 25 percent return in a series of limited partnerships which supposed had a positive track record and large profit margins.  The SEC’s press release in this case is longer than most, but it’s well worth a read in its entirety. According to that release: (more…)

Con Across the Strait of Taiwan

Fraud is the same the world over.

Many believe that the best place in the world to find growth opportunities is China. That might be.  But where there are profitable investments there are always frauds masquerading as profitable investments. This week came word from China of an alleged fraud operating across the Strait of Taiwan. According to The China Post: (more…)

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