How to Smell a Rat: The Five Signs of Financial Fraud

Author(s): Ken Fisher

Business

In December 2008, a well-regarded member of the finance community, former NASDAQ chairman, huge charitable contributor, and pillar of New York society admitted to his sons that the $65 billion he managed for hedge funds, charities, foundations, Hollywood stars, and myriad smaller investors was a fraud - a Ponzi scheme. 2008 and 2009 will be remembered for bear markets, a global credit crunch, and some of the largest investment scams ever. But these scams are nothing new - from Charles Ponzi to Robert Vesco to Bernard Madoff - they've been repeated throughout history, and there will certainly be more to come in the future. But the good news is fraudsters often follow the same basic playbook. Learn the playbook - and know how to ask the right questions - and financial fraud can be easy to detect and simple to avoid. Some advisers start intending to embezzle. Others evolve to it - as Madoff claims. Either way, it's structurally the same, and you can learn ways to identify both intended and possible future fraud. Throughout your investing life, you may be presented with opportunities that seem too good to be true. In "How to Smell a Rat: The Five Signs of Financial Fraud", trusted financial expert Ken Fisher - provides you with an insider's view on how to spot potential financial disasters before you commit your money to a scam. Filled with in-depth insights and practical advice, this reliable resource takes an engaging look at recent and historic examples of fraudsters, how they operated, and how they could have been easily avoided. Fisher then shows you quick, identifiable features of potential financial frauds and arms you with questions to ask when assessing money managers. With this newfound knowledge, you can learn to spot red flags, such as: advisers with direct access to investor's funds; firms with numbers that seem - too good to be true; and, managers with fees that are too low - Madoff didn't charge any fees, he just charged for trading! There should be a premium for integrity. Asking the right questions and performing the proper due dilligence go a long way toward finding a firm that insulates you from financial fraud. With the help of trusted financial expert and bestselling author Ken Fisher, you'll be better prepared to identify and avoid financial scams that could instantly destroy the wealth you've worked so hard to build.

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With five straightforward rules that would have saved any investor from Bernie Madoff, investment firm CEO and Forbes columnist Fisher (100 Minds That Made the Market) gives readers a secure plan for fraud-proof investing, worthwhile for novices and sophisticated financiers alike. Using the example of everyman "Jim," a precarious investor navigating shark-filled waters, Fisher presents a clear, fast-paced, tightly organized guide to principles like "Too good to be true usually is," and "Due diligence is your job, no one else's." Fully-referenced data, insider details, laser-focused statistical digressions, and the finer points of practical investing keep pages turning. Readers will value the practical, easy-to-follow models of solid, transparent investment strategies and examples from Fisher's experiences as CEO of his own investment firm. Fisher also includes suggestions for further reading and appendices that reproduce previously-published comparisons of different asset allocations, information for small business owners and short biographies of market-movers. Much more than what to avoid, Fisher's concise guide should be highly illuminating and confidence-building for anyone with a bank account. (Aug.) Starred review (Publishers Weekly, September 2009) Using well-known examples from recent headlines like Bernard Madoff and R. Allen Stanford along with a bevy of historical scam artists, Fisher details the red flags that should alert investors. They are: advisers who have access to your money; promises of returns that are too good to be true; mumbo-jumbo that takes the place of explaining investing strategy; fake benefits like exclusivity, and relying on someone else for due diligence. (Associated Press)

Ken Fisher is best known for his prestigious 'Portfolio Strategy' column in Forbes magazine, where his twenty-five-year tenure of high-profile calls makes him the fourth longest-running columnist in Forbes' 90-plus-year history. Ken is the founder, Chairman, and CEO of Fisher Investments, an independent global money management firm. He is on Investment Advisor magazine's prestigious IA-25 list of the industry's most influential people; is the award-winning author of numerous scholarly articles; and has published five previous books, including the New York Times bestsellers The Only Three Questions That Count and The Ten Roads to Riches'both of which are published by Wiley. Ken has been published, interviewed, and/or appeared in most major American, British, and German finance or business periodicals. He has a weekly column in Focus Money, Germany's leading weekly finance magazine. Lara Hoffmans graduated from the University of Notre Dame with a BA in theatre. She is a content manager at Fisher Investments and contributing editor of MarketMinder.com. She also coauthored with Ken Fisher the bestsellers The Only Three Questions That Count and The Ten Roads to Riches.

Acknowledgments. Introduction. Chapter 1: Good Fences Make Good Neighbors. Chapter 2: Too Good To Be True Usually Is. Chapter 3: Don't Be Blinded by Flashy Tactics. Chapter 4: Exclusivity, Marble, and Other Things That Don't Matter. Chapter 5:

General Fields

  • : 9780470526538
  • : John Wiley & Sons, Limited
  • : John Wiley & Sons Ltd
  • : 0.412
  • : 03 September 2009
  • : 233mm X 162mm X 22mm
  • : United Kingdom
  • : books

Special Fields

  • : Ken Fisher
  • : Hardback
  • : English
  • : 364.163
  • : 224
  • : Finance; Crime & criminology