International Law

Interlake Chemicals Consents to Order re Business Opportunity Fraud Statute

Posted on March 27, 2008
The State of Washington reports that Glen Stroud, Dan Hammond and Interlake Chemicals have consented to an order under the Business Opportunity Fraud Act of Washington. None of the defendants admitted or denied the allegations made, viz. that they were selling unregistered business opportunities in the State of Washington...

Can God's Fraud Squad Make You Rich?

Posted on March 27, 2008
In the London Free Press, there is a story on the House of God also being the House of Con. "In traditional church language, the congregation is the flock. They are supposed to follow their shepherd, the Lord. Too often, the flock is instead fleeced...

Why eBay Franchise Failed

Posted on March 26, 2008
Scott Pooler has a long analysis on why the eBay Drop Off Franchises failed. He is a former eBay Trading Assistant. But his insights on the failure of this franchise system can be generalized. First, what was the pitch? "These franchises promised individuals an easy way to be in business for themselves - a way to "have a store without investing in inventory" by offering a simple effective solution to everyone in America's battle with clutter...

Christian Fraud

Posted on March 25, 2008
As reported by the FBI in Seattle, a man known in the community as a Christian committed a ponzi fraud, "LAVIN pleaded guilty on November 2, 2007. He admitted that over the course of the fraud he made numerous fraudulent representations. LAVIN claimed the funds would make between 1...

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Cooling the Mark Out

Posted on March 25, 2008
Erving Goffman wrote "On Cooling out the Mark" in 1952. It was an application of Mauer's elaboration of con criminals method of ensuring that their victim did not raise too much of a fuss with the federal authorities, "cooling the mark out" to other adaptations to failure...

Romp and Roll Lies

Posted on March 20, 2008
Romp n' Roll is a franchise system which claims that: "Romp n' Roll is structured horizontally. We offer Gym, Art, Music, Silly Science, Good Sports, Superheroes, Princess Class, Bug Club, All About Dinosaurs, even Romp y Roll en Espanol (and a whole lot more) to a more narrow audience (children under 6 years)...

Folsom Fraud - How it Worked

Posted on March 20, 2008
Very interesting article about a religious based ponzi scheme. "Investigators have presented to the U.S. Attorney's Office evidence for their belief that Wilson's Christians In Crisis Investment Fund was a Ponzi scheme, a personal money pool from which Wilson paid bogus returns to early investors with cash from later investors -- not from any earned investment proceeds...

Ponzi Con Criminal - Stole From Seniors

Posted on March 19, 2008
Interesting story from the SEC about Gibbs who allegedly ran a Forex Ponzi scheme. "The Securities and Exchange Commission today announced the filing of a settled civil injunctive action in the United States District Court for the Eastern District of Virginia against Ralph Gregory Gibbs, a resident of New Haven, West Virginia, who operated an offering fraud and "Ponzi" scheme...

The Hell with Heroes

Posted on March 19, 2008
Why should we prefer a lie over the truth? Even when the truth is far more interesting than the fiction? The fiction was that Jessica Lynch was a hero in Iraq. "Five years ago, America needed heroes. Just three days into a polarizing war with Iraq, the 507th Maintenance Company, the last in a column of 600 vehicles making its way toward Baghdad, got mired in sand with jammed weapons...

Music Machine Scam!

Posted on March 18, 2008
Colorado scam has an interesting twist. "Rick D. Van Vleet allegedly promised his investors a hefty return if they invested in the music kiosks he was pushing. But Van Vleet lied to them, stealing nearly $3 million in the process, the Colorado Attorney General's Office said Wednesday...

Value Click Fraud

Posted on March 17, 2008
The FTC announced that Value Click will pay almost $3 million for its fraudulent advertising. "According to the FTC, ValueClick subsidiary Hi-Speed Media used deceptive e-mails, banner ads, and pop-ups to drive consumers to its Web sites. The e-mails and online ads claimed that consumers were eligible for "free" gifts, including laptops, iPods, and high-value gift cards, and included come-ons such as "Free PS3 for survey," and "CONGRATULATIONS! Select your FREE Plasma TV...

New York Ponzi Scheme

Posted on March 16, 2008
According to the FBI's press release about a new Ponzi scheme, "MICHAEL J. GARCIA, the United States Attorney for the Southern District of New York, announced today the indictment of HAYIM REGENSBERG on securities and wire fraud charges stemming from an alleged $11 million "Ponzi" scheme involving purported international initial public offering ("IPO") and othe investment products he marketed to investors from New York City and elsewhere...

Why is Western Union Used in Frauds?

Posted on March 16, 2008
I had posed this question to Ed Dickson, who writes the Fraud, Phishing and Financial Misdeeds Blog. Ed responded, via a comment. But I thought the comment was worth an entire post. Here is Ed's reply. "That's a good question. Western Union and MoneyGram are services that are used, more often than not, by people who don't have established banking relationships...

Pi Day

Posted on March 13, 2008
March 14th is pi day. Pi is the ratio of the diameter of a circle to the measure of the the length of going around the circle, its circumference. It is both irrational and transcendental. No two integers, A and B, expressed as A/B equal pi. Nor can no finite sequence of algebraic operations on integers (powers, roots, sums, etc...

Business Opportunity Fraud Rising?

Posted on March 11, 2008
The South Florida Sun-Sentinel admonishes it's readers to Watch for business opportunity fraud Well are there more suckers out there? Has the downturn in the economy made people more risk seeking? Here is the the South Florida Sun-Sentinel says: "But in your quest to become an entrepreneur, don't get suckered into a deal that will just make someone else money...

The Top 10 Canadian Law Blogs

Posted on March 11, 2008
Hey, we are in another top ten list, Canadian Lawyer Magazine: Top Ten Legal Blogs Here is the full list, and Gerry Kirbyson's review. "MICHAEL GEIST Geist is a University of Ottawa law professor specializing in privacy, copyright, and internet law...

Are Men Programmed for Illicit Sex?

Posted on March 11, 2008
Here is a very bad argument, over at Psychology Today, An evolutionary psychological view about power and illicit sex. "Powerful men of high status throughout human history attained very high reproductive success, leaving a large number of offspring (legitimate or otherwise), while countless poor men in the countryside died mateless and childless...

What is New with Free Offers?

Posted on March 10, 2008
Over at the Consumer Law and Policy Blog, there is a neat summary of an article by David Adam Friedman, On Free Offers "Free offers can be perceived as merely harmless exaggerations or simple puffery. In fact, why wouldn't consumers want free goods and services? Rational consumers should want truly free goods and services...

Franchising or Chain?

Posted on March 10, 2008
Very interesting article over at Franchise- Chat, Mark Siebert's piece called "Should You Sell Franchises or Build a Chain?" One of the franchising myths Siebert seeks to dispel it that franchising involves more legal risk than other methods of expansion...

ACN is Not a Scam?

Posted on March 10, 2008
Well, what do you think? Someone reading information off the ACN Website. Neat-O. Doesn't change my opinion - lousy earnings claims.

Are You a Pest Franchisee?

Posted on March 09, 2008
The franchise rep tells us about Franchisees I Don't Like to Visit. She writes: "Franchisees I don't like to visit are rare, but there are a few with traits I don't like to be around, 1. Franchisees who are "know it alls" and argue with everything I say...

What Can you Learn from Carl Icahn?

Posted on March 09, 2008
Carl Icahn is a legendary investor, corporate raider, and relentless worker. How can he help you avoid fraud? Well consider the SEC's fraud allegation in Thompson Consulting Fraud "The SEC charged Thompson Consulting, Inc., Kyle Thompson, David Condie and Sherman Warner with violations of the antifraud provisions of the securities laws by engaging in much riskier trading strategies than those described to investors, several of whom were seniors...

Quiznos's Class Action Fails

Posted on March 07, 2008
Over at Blue Mau Mau, Don has an article about the Quiznos rebate class action lawsuit certification. This case is the first Canadian case to deal with the troublesome problem of franchisor rebates, and who is entitled to them, and whether a franchisor's scheme for keeping rebates violates Canadian Anti-Trust Law or the Arthur Wishart (Franchise Disclosure) Act...

Why Did USANA get Slapped?

Posted on March 06, 2008
Tracy Coenen has a nice post about the Usana lawsuit against Barry Minkow, Usana Health Sciences loses Big in Court Here is the Court Order in the Usana Lawsuit. Minkow was sued by Usana in connection with the report he released. When the lawsuit was brought, I questioned whether it would survive a SLAPP motion - a motion to dismiss...

Fake business opportunities plague Arizona consumers

Posted on March 06, 2008
Arizona has a problem. Apparently, fake business opportunities plague Arizona consumers The state Attorney General's office said Tuesday it received more than 46,000 complaint calls last year, 23,000 of which resulted in the Attorney General's office filing formal complaints...

Pesky calls top consumer gripes

Posted on March 06, 2008
Ok, this is something I really don't understand. Why are pesky calls top consumer gripes Everyone thought registering on the Do Not Call list would put an end to the pestering phone calls from telemarketers, but that hasn't happened, according to state officials...

Why Do You Buy Crap that You Don't Want?

Posted on March 04, 2008
Do you buy things that you later regret? Do you wonder why you keep making this mistake? Dan Ariely thinks he knows why. An accomplished economist, with a literally disfiguring past, Ariely treats us in his new book, Predictably Irrational, to a series of novel experiments designed to show that "people make repeated mistakes without being about to learn much from their experiences...

Have You Heard of this Miracle Cold Buster?

Posted on March 04, 2008
The Centre for Science in the Public Interest has a nice story about Airborne Agrees to Pay $23.3 Million to Settle Lawsuit Over False Advertising of its "Miracle Cold Buster" ~ "The makers of Airborne?a multivitamin and herbal supplement whose labels and ads falsely claimed that the product cures and prevents colds?will refund money to consumers who bought the product, as part of a $23...

Due Diligence for Franchisees

Posted on March 03, 2008
Richard Solomon and I have a similar view about the best due diligence a franchisee can perform - work in the franchise system.The Best Answer... to Franchise Due Diligence "The first and best way to prevent yourself from being scammed is for you to keep your investment money in your pocket and get a job with a franchisee of the franchise system you like for a year and learn it from the inside...

False Hopes

Posted on February 29, 2008
Court Bars Georgia Defendants from Selling Bogus Business Opportunities From the press release: "At the request of the Federal Trade Commission, Judge Charles A. Pannell, Jr. of the U.S. District Court for the Northern District of Georgia, Atlanta Division, has issued an order finding that several Georgia-based defendants violated the FTC Act and the Commission's Franchise Rule and Business Opportunity Rule by pitching fraudulent ink cartridge business opportunities to consumers...

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