For one Maine couple, the allure of James Philbrook’s pitch proved too irresistible. In fairness to Philbrook, the money the scam generated in part went to paying off the debts of a buddy’s kid who also struggled with staying on the right side of the law. As for the selection of Electra, one can hardly quibble with a line of thinking that went “I saw this hot young thing on a TV Guide in the mid-1990s.” Read more »
Who Among Us Wouldn’t Listen To A Guy Pitch An Investment Involving “Pay-Per-View Programming Starring Carmen Electra” And Proceed To Wire Him $195,000?By Bess Levin
Frank DiPascali, for one, knew it was a fraud from his first day on the job. Didn’t stop him from working there for another 38 years, but the point is, he knew what was up from the beginning, Dipascali said today in court. Read more »
Remember David Miller? Rochdale Securites trader who masterminded a scam that involved the “unauthorized purchase of about $1 billion in Apple stock,” which he claimed was for a client (a lie)? Forget to dot a few essential i’s and cross a few crucial t’s in the scheme, which contributed to its failure and left the firm in a “negative capital position”? Robbed the universe of Dick Bové research for a time? Which thankfully turned out to be a very short amount of time, i.e. the period between Bové’s resignation from Rochdale and the announcing of the winner of the Dick Bové Sweepstakes? Yeah, he’s going to jail. Read more »
Noted White Shoe Law Firm Happy To Represent $3.7 Billion Hedge Fund, Less Interested In Defending Alleged Crook With Overdrawn Bank AccountBy Bess Levin
Yesterday afternoon, federal prosecutors charged Fredrick Douglas Scott, the self-described “youngest African-American hedge fund founder in history,” with engaging “in a wire fraud conspiracy to steal hundreds of thousands of dollars from investors1,” which he used to buy Caramel Macchiatos, stay in hotels with views of the Holland Tunnel, and bail his friends out of jail.2 At this time, there appear to be several inconsistencies with the stories Scott has told clients and friends, which include:
- The claim he manages $3.7 billion.
- The claim he makes $96,000/year (“[Scott] filled out a financial affidavit claiming his salary is $96,000. Scott then told pretrial services he makes $200,000 but takes home only $50,000 a year, prosecutors said. Scott’s personal account at TD Bank showed over $700,000 “flowing in and out,” but as of April 30 his ACI Capital Group account was overdrawn by $91.24.”)
- The claim his in-laws were his get out of jail free card (“Scott [has said] his wife’s parents have ‘Italian diplomatic status,’ and he boasted to the FBI that if he got in trouble, she would be his ‘ace in the hole.’”)
Will we find out that the above weren’t so much lies as misunderstandings in the days to follow? Maybe! At this time, however, the most pressing issue Scott may want to resolve would be that of his representation, which is currently not returning his calls. Read more »
Last week the SEC settled a securities fraud case with one Ziad K. Abdelnour, CEO of Blackhawk Partners, for a $25,000 fine and a five-year ban from the securities industry. The fraud was not exactly hard to recognize: anyone who, while claiming to represent “a purported private equity ‘family office,’ solicited investors to invest in trading programs that purportedly yielded returns of up to 600% in as little as seven days, with no risk,” is overcompensating. (For: fraud.)
But Abdelnour’s fraud was even more obvious; he basically said right on his website – under the bold heading “WARNING ON SCAMS” – that what he was selling was a scam. As the SEC puts it, his “website also discouraged prospective investors from heeding Commission and FBI warnings about private placement programs, stating:”1
WARNING ON SCAMS
It is very common to find on the internet so many web-sites, or message boards/links to so-called official documents, or reports of the “Financial Authorities” warning the public that this business ‘does not exist’ and any of these offers are always scams. The reports in question could have been written by the SEC, FBI, ICC or any of the regulatory authorities. . . . You should all understand that most people that work at banks, securities houses, accountant firms, etc., have no insight into this kind of trading, and they are very eager to listen and comply with everything by the authorities. So if SEC, FBI and others say that this is all a scam, then they believe so.
For all you nay-Sayers and disbelievers out there who are looking for evidence that this kind of trading exist[s]; try to learn and understand monetary history and banking and you will understand that this can, in fact, work- in theory. You don’t have to run around and try to find evidence, because unless you have USD10M to test it for yourself, then you need to rely upon others who are vouching. So we suggest that you find out the truth yourself, without listening to what others are saying.
Who are you going to believe: an SEC/FBI fraud warning, or some guy asking you to trust him with $10 million? The choice is clear. Read more »
Texas Man Accused Of Fraud Reeled In Former Cowboys Player, Other Clients With Fictional Ties To Goldman SachsBy Bess Levin
Are you a person who “likes to drink beer, drive fast cars, and get into more trouble than [you] should”? Do you have your eye on a Hummer, a lap dance and a six-pack but are running a little short on cash? Do you have a great idea to pitch people on a bunch of (fake) investments that include hedge funds, a fixed-income trading plan and movie distribution investment contracts but are worried that what with the lack of a prestigious university on your resume and your professional contacts only coming from your job as a telephone solicitor for a long-distance provider, people won’t take you seriously, to say nothing of your goatee? Not to worry! Take a page from Christopher Love Blackwell’s playabook and you could be looking at least $4 million for your beer fund. Read more »