Are Risky Mortgages Back in Favor?
What started out as a reasonable strategy to allow first time or low credit score buyers to own homes turned into a predatory lending and default spiral that brought down a $1.1 trillion-dollar yearly industry. In the wake of the subprime mortgage crisis, regulatory bodies and legislators alike stepped in to create safeguards against a […]
Developing a Portfolio: Balancing Risk and Reward
The role of brokers and registered investment advisors is invaluable; they educate investors; they manage the fine, tedious details of investing; and they give their best advice and guidance to clients who come from a variety of backgrounds and financial familiarities. Investing is much more of a science than an art. It is a learned […]
Bond Fraud Trial Sees Mixed Results for Nomura Holdings Inc. Traders
Investment brokers have certain obligations to all their clients: to not only tell the truth, but also to provide guidance that reflects the client’s specific needs and wants. This responsibility is also known as suitability. Although suitability may at first seem amorphous, in reality, the law has set out very clear guidelines for what types […]
Pension Advance Scams Target the Elderly
Pensions are the primary means of support for about one-half of Americans of retirement age or older. This income—set aside throughout the course of a lifetime of employment and work—is often supplemented by social security, or other retirement investing. However, America’s seniors are not usually living in the lap of luxury, bringing in an average […]
Ponzi Scams Persist: SEC Crackdown Continues with Recent Judgment
Beyond sheer greed and malevolence, the most common catalyst for Ponzi schemes is to cover up other serious losses. This was the situation for Francisco Illarramendi, a former hedge fund manager in Connecticut, who ultimately spent five years raising over $30 million in illicit funds to cover an initial $5 million shortfall. But such is […]
Investment Fraud from the Pulpit?
Religion rarely comes into account when making investing decisions. However, in the case of one church in California, the mixture led to fraud, losses, and a lawsuit. The church mandated participation in the courses: victims claim they were pressured by their religious leaders into taking investing direction from Paul Ricky Mata, a member since the […]
Bitcoin: New Currency, New Investment Scams
In early March of 2017, the value of one Bitcoin surpassed the value of one ounce of gold for the first time. Proponents saw this development as validation of the digital currency’s endurance; but other, more baleful watchers saw instead an opportunity to create new scams and defraud unwary investors. Why is Bitcoin so exciting […]
When Your Promissory Note is Void of Promise
Promissory notes are often used by companies to raise revenue. Investors loan money to the company in exchange for a promise to repay the principal, plus interest, on a specific date. While these forms of debt can sometimes be legitimate, there is a substantial enterprise of fraudulent notes being marketed to individual investors. With hundreds […]
Securities Fraud: What Is Insider Trading, Exactly?
Since 2014, the news has been telling the story of Thomas C. Davis, the former chairman of Dean Foods, a professional gambler named Billy Walters and golf legend Phil Mickelson. According to the Justice Department and the SEC, these three men have been involved in an insider trading scam that netted Walters approximately $40 million […]
CFTC’s Advisory of Precious Metal Investment Fraud
Precious metals, like gold and silver, are classified as commodities. The United States Commodity Futures Trading Commission (CFTC) is the federal agency that regulates commodity markets. The agency has issued an advisory regarding the fraudulent activities surrounding precious metal investments. The advisory warns of “tricky promises of easy profits,” and provides potential investors with warning […]