In browsing through the Wall Street Journal I ran into three stories side by side: China Calls Lending Platform Ezubo a $7.6 Billion Ponzi Scheme J.P. Morgan Acquires Nearly $1 Billion Worth of Lending Club Loans Remember ‘Liar Loans’? Wall Street Pushes a Twist on the Crisis-Era Mortgage Each is a different side of specialty … Read more »
Category: Fraud
It’s Hard to Tell What the Next Form of Cheating Will Look Like
One of the problems with compliance is that the fraudsters seem to be one step ahead of the regulators. The regulators try to push out rules to prevent bad behavior. Regulators look at their charges to find cheating. But the cheaters are often one step ahead. We saw this in professional cycling over the weekend. … Read more »
Shkreli Gets His Holiday Gift… Handcuffs
One of the most hated men in American business was grabbed by the FBI and put in handcuff. The Securities and Exchange Commission slapped a “me too” suit on him as well. Martin Shkreli did the perp walk last week for running a ponzi scheme. Shkreli became the face of what is wrong with the … Read more »
Twitter for Stock Manipulation
Twitter is stream of random thoughts, news, insightful commentary, boring stories, humor, sadness, food pictures, hate, love, and cat pictures. The internet as a whole. At least a few traders have used Twitter as stock pricing indicator. Theoretically, that means stories could be planted that would move the stock price of a company. One trader … Read more »
Failing the Family
Some Securities and Exchange Commission cases catch my attention because of their headlines or their focus on a real estate investments. The case against Lee Dana Weiss caught my attention because it was from my home town. The story is one of alleged self-dealing and failure to disclose conflicts. In a complaint filed in U.S. … Read more »
False Credentials, Fraud and Fund-Raising
With graduation season upon us we are lauding those students who have excelled in academic achievement, or at least did just enough to earn their degrees. It is all too easy for a fraudster to concoct false degrees, titles and awards to lure in unwary investors. With two recent fraud cases, the Securities and Exchange … Read more »
Sure Fire Way To Spot a Fraud: Look for the SEC Seal
The Securities and Exchange Commission does not “approve” or “endorse” any particular securities, issuers, products, loans, services, professional credentials, firms or individuals. The SEC does not allow private entities to use its government seal. Yes, the staff of the SEC regularly meets with public companies, regulated entities, and others. Some of these investments and entities … Read more »
Train Fares, Integrity, and Financial Services
On Monday Britain’s financial regulator banned a senior financial services professional from the industry for life. His transgression was the failure to pay his train fare. BlackRock director Jonathan Paul Burrows was caught by inspectors at Cannon Street station last year. Mr Burrows has admitted that, on a number of occasions, he deliberately and knowingly … Read more »
When Fundraising Becomes More Lucrative Than Running the Business
Erick Mathe had a vision of creating a media empire. Well, maybe not an empire, more of a small keep. His plan was to broadcast over Low Power Television Service. Those are locally-oriented television broadcasts in small communities. Mr. Mathe had a line up of streaming music and infomercials. He just needed capital to get … Read more »
Not Securities Fraud By Reason of Insanity
Some investment fraud schemes sound crazy, but leave just a enough truthful-sounding bits to catch people. But Thomas Lawler’s scheme sounds completely bonkers. He established the Freedom Foundation to offer investors the chance to erase their debts and collect lucrative profits through the purchase of “administrative remedies”. Never heard of profit-making “administrative remedies”? Lawler can … Read more »