A recent enforcement action from the Financial Industry Regulatory Authority (FINRA) answers one of the questions I get most often: “If I’m with a big name brokerage firm, I don’t have anything to worry about, right?” According to FINRA, Ralph Edward Thomas Jr., while a representative for Wells Fargo Advisors, stole money from many of his clients. One of the accounts from which he stole was set up to benefit a child suffering from cerebral palsy. According to a story from Investment News: (more…)
On April 16, 2012,
in Scams, Securities Industry (general), The Vigilant Investor, Wells Fargo Securities Inc.,
by IW Dog
Vigilant investors long ago jettisoned romantic notions of the stockbroker as protector of the nest egg.
Tagged with: broker • due diligence • Ed Thomas • Edward Thomas • endowment • financial adviser • financial advisor • Financial Services Authority • FINRA • fraud • hedge fund • Huddleston • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • misappropriation • pension fund • Private Equity • Ralph Edward Thomas • Ralph Edward Thomas Jr. • Ralph Thomas • RIA • scam • scheme • stockbroker • The Vigilant Investor • Wells Fargo • Wells Fargo Advisors • Winnow
On March 8, 2012,
in Insurance Agents, Investor Protection, Scams, The Vigilant Investor, United Kingdom, United Kingdom,
by IW Dog
The promise that an insurance company will pay in the event of fraud is a 100 percent accurate tip-off to a fraud.
I am serving as an expert witness for an attorney who practices on both sides of the Atlantic. He is well acquainted with the epidemic of financial fraud that has engulfed all of the UK as well as the United States. During our last meeting he shared with me a tactic that he has seen UK fraudsters use, and he granted his permission for me to share with you. (more…)
Tagged with: Bernie Madoff • broker • Broker Snapshot • Constant Patrol • due diligence • endowment • financial adviser • financial advisor • Financial Services Authority • fraud • hedge fund • Huddleston • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • pension fund • Ponzi • prime bank • Private Equity • RIA • scam • scheme • The Vigilant Investor • Winnow
On February 15, 2012,
in Indiana, Raymond James, Scams, Securities Industry (general), The Vigilant Investor,
by IW Dog
The reality of the securities industry is nothing like the portrait firms paint in commercials that air during golf tournaments.
You can slice and dice the characters who commit investment crimes any number of ways; by modus operandi, by personality traits, by size of their cons. In The Vigilant Investor we divided them into five categories: the Professional Criminal, the Golden Boy, the Fibber, the Bungler, and the Thief. Prosecutors in Indiana have indicted a man who, if the allegations against him are true (he is presumed innocent), would fit solidly into the Thief category. According to journalgazette.net: (more…)
Tagged with: broker • Broker Snapshot • Constant Patrol • due diligence • endowment • financial adviser • financial advisor • Financial Services Authority • fraud • Greg Walker • Gregory B. Walker • Gregory Walker • hedge fund • Huddleston • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • misappropriation • pension fund • Ponzi • prime bank • Private Equity • RIA • scam • scheme • SEC • Securities and Exchange Commission • stockbroker • The Vigilant Investor • theft • Winnow
On February 2, 2012,
in Ponzi schemes, Scams, Securities Industry (general), The Vigilant Investor, United Kingdom, United Kingdom,
by IW Dog
Scamsters know that nothing succeeds like success.
The case broke in 2009 when London police raided the Knightsbridge offices of Business Consulting International. In the weeks that followed it became apparent that famous, wealthy, and financially sophisticated Britons had invested through BCI, in addition to many Mom and Pop investors. As is typical in such cases, angry investors, unwilling to come to grips with such devastating news, lambasted the police and securities regulators, insisting that the cops had gotten it wrong and were impeding BCIs ability to continue generating legitimate profits. This week, the 41year-old mastermind of the con put all such thoughts to rest. According to the BBC: (more…)
Tagged with: broker • Broker Snapshot • Constant Patrol • due diligence • endowment • financial adviser • financial advisor • Financial Services Authority • fraud • hedge fund • Huddleston • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • John Anderson • Kautilya Nandan Pruthi • Kautilya Pruthi • Kenneth Peacock • Nandan Pruthi • pension fund • Ponzi • Private Equity • RIA • scam • scheme • The Vigilant Investor • Winnow
On November 14, 2011,
in Scams, Serious Fraud Office, The Vigilant Investor, United Kingdom, United Kingdom,
by IW Dog
Investors who think that they’ve done a thorough due diligence investigation are left scratching their heads and wondering how they missed the fraud.
Investment fraud is not an American problem; it’s a world problem. While American frauds give us more than enough cases to discuss on this blog, there are even more cases overseas. Recent guilty pleas in the United Kingdom show that overseas scamsters are just as adaptable, prepared, and audacious as the American characters I describe in The Vigilant Investor. The next book might be about scams in other countries; I’ve certainly got enough material. According to Britain’s Serious Fraud Office: (more…)
Tagged with: Borge Andersen • broker • Broker Snapshot • Constant Patrol • David Horsfall • David McHugh • due diligence • Ed Davenport • Edward Davenport • endowment • financial adviser • financial advisor • Financial Services Authority • fraud • Gresham • Gresham Ltd. • hedge fund • Huddleston • Industrial Design and Finance • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • Louis Martin • pension fund • Pete Riley • Peter Riley • Private Equity • QualifEye • RIA • scam • scheme • Serious Fraud Office • Solicitor David Horsfall • The Vigilant Investor • Touchstone Accountants • Touchstone Accountants and Touchstone Law • Touchstone Law • Winnow
On October 17, 2011,
in New Zealand, Ponzi schemes, Securities Industry (general), The Vigilant Investor,
by IW Dog
There are no threats faced by American investors that aren’t also faced by Irish, Russian, or Australian investors.
Forty-seven percent of our regular readers live outside the United States. We love that; it helps us spread the lessons of vigilant investing across the globe. There are no threats faced by American investors that aren’t also faced by British, Russian, Chinese, Canadian, or Australian investors. This week, we learned of an alleged scam in a country we’ve yet to cover: New Zealand. According to stuff.co.nz: (more…)
Tagged with: broker • Broker Snapshot • Constant Patrol • due diligence • endowment • financial adviser • financial advisor • Financial Services Authority • fraud • hedge fund • Huddleston • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • Jacqui Bradley • Mike Bradley • pension fund • Ponzi • Private Equity • QualifEye • RIA • scam • scheme • SEC • Securities and Exchange Commission • Serious Fraud Office • The Vigilant Investor • Winnow
On April 8, 2011,
in Ponzi schemes, Scams, Securities Industry (general), United Kingdom, United Kingdom,
by IW Dog
Investment fraud is a global-not just an American-epidemic.
Based in Majorca, Gilher Inc. was the creation of John Neil Hurst. Hurst pitched the investment to British expatriates, citizens of Eurozone countries, and others, promising approximate returns of 20 percent per year. This week he appeared in a British court to answer charges that Gilher was a Ponzi scheme. According to an article in The Telegraph: (more…)
Tagged with: Broker Snapshot • Constant Patrol • due diligence • endowment • eurozone • financial adviser • financial advisor • Financial Services Authority • fraud • hedge fund • Huddleston • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • John Hurst • John Neil Hurst • majorca • Neil Hurst • pension fund • Ponzi • Private Equity • QualifEye • RIA • scam • scheme • Serious Fraud Office • Winnow
We’ve investigated investments on three continents and know first hand that investors worldwide are in the path of a tsunami of investment fraud.
Most of our posts are about U.S.-based fraud. There are more than enough of those to keep us busy. But, scamsters are just as busy overseas. Today we’ll look briefly at two that have been in the news recently, beginning first in Malaysia. According to AsiaOne News: (more…)
Tagged with: Broker Snapshot • Constant Patrol • due diligence • endowment • financial adviser • financial advisor • Financial Services Authority • Francois de Dietrich • fraud • FX Capital Consultant • FX Capital Consultant (M) Sdn Bhd • hedge fund • Huddleston • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • pension fund • Ponzi • Private Equity • QualifEye • Raja Noor Asma • RIA • scam • scheme • Serious Fraud Office • Winnow
On February 19, 2011,
in Ponzi schemes, Scams, Securities Industry (general), United Kingdom, United Kingdom, United Kingdom,
by IW Dog
Investment fraud is a worldwide epidemic. We’ve seen it on every continent except Antarctica.
Investment fraud is a worldwide epidemic. We’ve seen it on every continent except Antarctica. A recent case out of London looks very much like the mini-Madoffs that have dotted the headlines here in the States over the past three years. According to LondonNet: (more…)
Tagged with: Broker Snapshot • Constant Patrol • due diligence • endowment • financial adviser • financial advisor • Financial Services Authority • fraud • GFX Capital • GFX Capital Markets • hedge fund • Huddleston • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • pension fund • Ponzi • Private Equity • QualifEye • RIA • scam • scheme • Terence Freeman • Winnow
On May 21, 2010,
in Boiler Rooms, Financial Services Authority, Investor Protection, Scams, United Kingdom, United Kingdom,
by IW Dog
You may think of your own defenses as impenetrable. You may dismiss the chances that you could ever fall victim to one of these schemes. If that is you, you are in serious jeopardy.
The U.K.’s Financial Services Authority (“FSA”) has discovered a list of prospective victims in a case involving schemes to sell shares of nonexistent companies. There are 38,000 names on the list. According to columnists from the UK’s Mail.co.uk, “This hit list consists of intended targets largely living in London and the south east but also with many names in Yorkshire and Lancashire.” Investors in those areas, beware. (more…)
Tagged with: broker • Broker Snapshot • Constant Patrol • due diligence • financial adviser • financial advisor • Financial Services Authority • fraud • hedge fund • Huddleston • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • QualifEye • RIA • scam • scheme • SEC • Securities and Exchange Commission • stockbroker • Winnow
The Commission’s complaint alleges that BroCo Investments, Inc., its president Valery Maltsev, and/or individuals acting in concert with them hijacked the online brokerage accounts of unwitting investors using stolen usernames and passwords and subsequently placed unauthorized trades through the compromised accounts to manipulate the markets of at least thirty-eight issuers between August 2009 and December 2009.
The U.S. Securities and Exchange Commission (“SEC”) has filed an emergency enforcement action against a Russian company and its president, charging them with hijacking investor brokerage accounts for use in a market manipulation scheme. The SEC’s press release described the alleged scam: (more…)
Tagged with: Bernard Madoff • Bernie Madoff • BroCo Investments • broker • Broker Snapshot • Constant Patrol • dealer • financial adviser • financial advisor • Financial Services Authority • fraud • hedge fund • Huddleston • Inc. • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • Madoff • Maltsev • misappropriation • QualifEye • RIA • Russia • scam • scheme • SEC • Securities and Exchange Commission • Serious Fraud Office • stockbroker • theft • Valery Maltsev • Winnow
On March 19, 2010,
in Sales Practice Abuses, Scams, Securities Industry (general), Serious Fraud Office, United Kingdom, United Kingdom,
by IW Dog
Britain’s Financial Services Authority (“FSA”) has exposed a reality that few appreciate: scam artists know your name. According to a press release from the FSA: The Financial Services Authority (FSA) and City of London Police (CoLP) have contacted 1,000 people across the UK to warn them that their personal details are on a ‘master list’ being used by fraudsters to target and sell them worthless shares.
Britain’s Financial Services Authority (“FSA”) has exposed a reality that few appreciate: scam artists know your name. According to a press release from the FSA: (more…)
Tagged with: Bernard Madoff • Bernie Madoff • boiler room • broker • Broker Snapshot • Constant Patrol • dealer • due diligence • exchange • financial adviser • financial advisor • Financial Services Authority • fraud • hedge fund • Huddleston • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • Madoff • misappropriation • QualifEye • RIA • scam • scheme • SEC • Securities and Exchange Commission • Serious Fraud Office • stockbroker • theft • Winnow
On March 18, 2010,
in Financial Services Authority, Scams, Securities Industry (general), Serious Fraud Office, United Kingdom, United Kingdom,
by IW Dog
British authorities have charged seven people with conspiring to defraud UK investors out of more than $100 million through a series of boiler room operations.
British authorities have charged seven people with conspiring to defraud UK investors out of more than $100 million through a series of boiler room operations. The brokerage firms involved, Tresadern & Partners SL, Pricestone Group SL and Anderson McCormack SL, were based in Spain. Through those firms the defendants allegedly sold UK investors shares in sham American companies. The authorities alleged that the market for the shares involved was created through market manipulation involving false press releases and artificially created trading volume. The allegations sound very much like the pump and dump schemes that constantly plague American investors. (more…)
Tagged with: Anderson McCormack • Bernard Madoff • Bernie Madoff • broker • Broker Snapshot • Comision Nacional del Mercado de Valores • Constant Patrol • Daniel Gooding • Daniel Tresadern • dealer • Emma Farmer • financial adviser • financial advisor • Financial Services Authority • fraud • hedge fund • Huddleston • Ian Hughes • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • Jon Emery • Madoff • Michelle Coleman • Philip Morris • Pricestone Group • QualifEye • RIA • scam • scheme • SEC • Securities and Exchange Commission • Serious Fraud Office • Shaun Rumsey • stockbroker • theft • Tresadern & Partners • Winnow
On March 10, 2010,
in Cayman Islands, Financial Services Authority, Ponzi schemes, Scams, Securities Industry (general), Serious Fraud Office, Uncategorized, United Kingdom, United Kingdom, United Kingdom,
by IW Dog
A jury in Harrow Crown Court northwest of London has convicted Kevin Foster of operating a Ponzi scheme that defrauded hundreds of investors out more than 34 million pounds. Foster’s scam is a good primer on how many high profile scams operate today.
A jury in Harrow Crown Court northwest of London has convicted Kevin Foster of operating a Ponzi scheme that defrauded hundreds of investors out more than 34 million pounds. Foster’s scam is a good primer on how many high profile scams operate today. (more…)
Tagged with: Bernard Madoff • Bernie Madoff • broker • Broker Snapshot • Constant Patrol • dealer • financial adviser • financial advisor • Financial Services Authority • Football League Gaming Scheme • fraud • hedge fund • Huddleston • investment adviser • investment advisor • Investors Watchdog • Investor’s Watchdog • Kevin Foster • KF Concept • Madoff • Planline • QualifEye • RIA • scam • scheme • SEC • Securities and Exchange Commission • Serious Fraud Office • stockbroker • theft • United Kingdom • Winnow
On February 26, 2010,
in Financial Services Authority, Scams, Securities Industry (general), United Kingdom,
by IW Dog
UK’s Financial Services Authority Warns of Scamsters Impersonating Authorized FSA Firms
The UK’s Financial Services Authority is warning investors about a new tactic used by boiler room stock operations, which use high pressure sales tactics to force risky securities onto unsuspecting investors. According to the FSA, unscrupulous operations are posing as brokerage firms that are authorized by the FSA. The illegitimate operation may even clone the website of an authorized firm, changing only the telephone number and address, to fool investors. The FSA advises:
Should anybody receive an unsolicited call or email from a firm which they are not a customer of, the FSA is recommending that people should take the following steps:
- ask for the contact details of the person calling you;
- check the firm or individual’s status on the FSA register;
- call the firm back on the switchboard number provided on the FSA register to make sure that the call came from the legitimate authorised firm.
Anybody who has been contacted by a suspicious firm or has any doubts should report the encounter as soon as possible by calling the FSA on 0300 500 5000 or reporting it online.
This warning from the FSA points out the challenge facing every investor: knowing who to trust. Every scam artist portrays himself as someone he is not. This is just the latest variation of that practice. If all you know about a broker is what you learned from him or what you read on a website he or his employer created, you are at great risk of losing everything you have worked and saved for. Learn what the broker his not telling you by asking an investor protection company to do a pre-investment investigation.
Tagged with: Bernard Madoff • broker • Broker Snapshot • Constant Patrol • dealer • financial advisor • Financial Services Authority • fraud • FSA • hedge fund • Huddleston • investment adviser • Investors Watchdog • Investor’s Watchdog • Madoff • QualifEye • RCMP • Royal Canadian Mounted Police • scam • scheme • SEC • Securities and Exchange Commission • stockbroker • theft • Winnow
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A Gold Medal in Boiler Room Operation
Every competent investment scamster uses those tactics.
The games of the 30th Olympiad have begun, and the UK is putting it’s best foot forward. It is a wonderful place, no doubt. But, like every country, it has a segment of the population determined to live off of the misery of others. A recent case prosecuted by UK’s Serious Fraud Office tells a story that is familiar to securities cops worldwide. The press release is far too long to reprint in its entirety, but I highly recommend that you read the whole thing. We’ve reprinted part of it below. (more…)