Legal Thriller Author Asks: Legal Stock Tips or Con Man Boiler Room?--Are You a Victim?

Like a high-gloss diamond ring on the hand of a glamorous fashion model, the offices of a legitimate stock brokerage will sparkle. When you visit one you will not feel like you are going up against a card shark in a gambling casino. You will quickly conclude that these are not the premises of a scam artist's carnival midway joy ride.

They will showcase a good balance of offerings. Many of these will be with Fortune 500 companies and a good cross-section of well-known, prestigious firms listed on the various stock exchanges. And no quick-buck con men to instantly push these either.

They are usually located at easy-to-find addresses on well-known streets, and are housed in well-lighted, nicely-appointed offices. Very subtly you will get the idea that, while money can't buy happiness, it sure makes misery a lot easier to deal with.

Extensive biographies of their brokers and other operational and management personnel are most often readily available. Some you will meet, with no hint or talk of up the ante, beat the street, sweeten the pot, a sweetheart deal, or it's a cash cow.

And, their list of references and testimonials from satisfied customers is usually extensive. No chest thumping, self-congratulatory back slapping of themselves as being the "best in the financial guru business."

In checking out their research facilities you will also find an attempt at thoroughness, a striving to provide fact-digging excellence to support their stock and bond selection recommendations.

In sharp contrast. . .

Much like the face on the bar room floor, a boiler room--or bucket shop--will almost always be located on a back street, in a dingy office. It will have many small desks shoved together, or in tiny cubicles, featuring sales personnel--scam artists-- working phone banks, reading from scripts in their conversations. They do not provide wide-spread offerings. And, no research facilities open to the public at this version of a Norman Bates motel either. No extensive bios and no variety of testimonials. Their surroundings are much like the settings in a legal thriller movie.

Do not expect to deal with someone inspired by Mother Teresa. Rather, the boiler room boys will glad-handingly pass themselves off to you as the most gifted authorities on the American free enterprise system since the Rockefeller clan's bankers. Their specialty, along with their operational goals, is quite different from the legitimate stock brokerage. Learning these differences is essential to your financial well being. Failure to do so could be the equivalent of diving into a lake encased in a cement life jacket. The con men's "specialties" includes:

> Classic Pump and Dump operations.
Just another well-known shell game.

> Reverse of the Pump and Dump, known as the Short and Distort. Here the scam artists spread rumors in order to drive the prices of thinly traded stocks down. rather than in the generally accepted direction, up. Then, they buy back the results of their "short sales" at a discount and profit. Most often considerably.

> The selling of fictitious foreign exchange investments. Yes, that's right, stuff grabbed purely out of thin air. The scam artists know how intriguing it is to seduce with language like "foreign exchange," and how many suckers exist out there who will "sail" for this exotic-sounding type investment.

> The selling of risky, small cap IPO's (Initial Public Offerings). Now, not all IPOs are necessarily poor investments. Some--a very few--are actually millionaire makers. But, the odds against are enormous. The only good, proven millionaire-making potential here is for the scam artists who peddle them. The odds do truly smile on the con men in this investment category.

> The selling of "house stocks," shares in shaky companies--usually tiny firms--that are of OTC Bulletin Board or Pink Sheets quality at best.. These are usually blocks of stock that the scam artists have purchased at a sharp discount. Exceptions? Yes, like IPOs. A select few will flower, flourish, and produce bountiful profits. But, the big majority will reward--only--the con man advocate.

> Maybe the worst of all the practices of these people is the holding back on execution of sell orders. And, sometimes outright failure to execute. (They will go to great lengths to avoid the creation of downward pressure on the prices of stocks they are trying to unload.)

Selection can be of equal challenge--in determining reality as opposed to the plot of a legal thriller book. Your failure at being able to distinguish between the two--differentiate between the legitimate and illegitimate operations--could be costly to you. If you were to, somehow, stumble into dealings with the boiler room boys by mistake, you would be like the lumberjack 100 feet up a tree suddenly coming upon a bee hive. Naturally, you can stomp, cajole, complain. You can threaten them with a law suit.. Of course, you can always try taking a bone away from a pit bull, too. You'd probably get equally as far.

Scam Artist or Ethical Stock Broker?--How You Can Tell the Difference

The quickest way to tell if your stock broker is a scam artist, using your account for broker profits rather than yours, is to look for evidence of "churning."

Say you have just opened a stock brokerage account and your broker puts you into Fast Buck Industries as your very first "investment." You get your first statement and see that she has traded Fast Buck three times. You also note several stocks listed that you had not discussed. It's only unethical or illegal if you get caught, is often the rationale.

You ask a few knowledgeable people, who know a little something about the stock brokerage business as well as stock scams, and they feel that your new broker is a scam artist who is "churning," buying and selling for your account--frequently--in order to generate more income for herself through increased commissions. A shark is the only fish that can blink with both eyes, you might note, as you try to fit applicability to scam artists.

This practice--"churning"--occurs more often than you might think. Many people succumb to their broker's appeal to give them "flexibility" so they can react quickly to take advantage of fast-rising opportunities, for the benefit of their customers. Whereas you could have easily avoided all this in the beginning by simply refusing to sign the discretionary papers giving your broker authority to trade on your behalf, without your prior authorization. "Experience" is a socially-accepted word people often use to explain accumulated mistakes. This mistake would have to be classified as a substantial contributor.

O.K., so you had granted your broker--or scam artist?--such unilateral authority. Losses to you occurred, while commissions to your broker mounted. What to do now?

You have multiple avenues of recourse. First you must protest, in writing, immediately. (Failing to do this could be deemed tacit approval, on your part, for what your broker has done.) Conflict of Interest is a possible complication to check out. Suitability Claims is another. (Has the broker fitted the trades to your "risk profile?") Misrepresentation is a good one.(Failure to disclose important information to you involving the trades.) Unauthorized trading. (This brings the focus right back to where you started: what exactly does the document say--in what words--which gave your broker authority to trade for you in the first place?)

In self-defense, a broker will commonly sell off the winners to show, at least, a small profit. Don't be fooled by this. This could still be scam artists' activity. The losses were most likely retained.

In business, stocks are the basis of essentialism. In the beginning your broker may have played herself up as the greatest authority on free enterprise stewardship since J.P. Morgan. But, to counter the hype, you must consider all angles. In many ways, stock scams are now a whistle blower's delight. So many new tools have been made available to the stock-buying consumer (including, even, the infamous Sarbanes-Oxly Act) that you now have every chance of getting justice over any stock "churning" dispute. Nobody cares if you can't dance; just get up and dance. Fast, decisive action on your part is key.

Con Man Invasion--Internet Black-Market Flourishing

--Internet black-market bazaar loaded with con-man-produced valuable documents of every kind for sale

Magalia, California--About everything is obtainable--for a price --over the internet.

Up for sale by con men. It started out with simple credit card theft several years ago and has now flowered into just about every form, document, verification number, or identification conveyance imaginable. As the internet expands at a breathtaking pace, so does identity theft right along with it. Now available for purchase are not only credit cards (with verification codes and mother's maiden name), but debit cards (with pin numbers), social security cards, visas, passports, birth certificates, marriage licenses, even death certificates. If one has a criminal turn of mind, just a couple of thousand dollars can buy that person a whole new (stolen) life, according to former Business Opportunities Digest editor / publisher, Jack Payne, who has studied the con man market over the past 45 years.

Business is so brisk that con men even maintain a market in names. Choice names from their victims' lists trade for up to $250--each.

The list of information available on each victim is frightening to many. These data include: names, addresses, phone and fax numbers, email addresses, driver's license numbers, social security numbers, passwords, debit and credit card numbers, other banking information, and a breakdown of buying patterns and net worth /debt status. The invasion is real. It's total. Con men are flooding into this market. Their intent? Theories are up for grabs.

Con man exposers point to the problems of E Bay and My Space as confirmation of this trend.

In some third world countries, such a collapse of privacy protections have signaled anarchy. Big hope, law enforcers believe, is that the U.S. is too advanced a civilized society and that "it can't happen here."

Thriller book author, Jack Payne, ponders the challenge further, "Talk about a tough life. For the average guy and gal in our society it's hard to beat the game. If they earn anything it's minus taxes. If they buy anything it's plus taxes. That's just for starters. Relationships, kids, school, house and car payments, neighborhood crime-- the list of day-to-day obstacles gets pretty grim. In facing all of these problems each day when they first get up, they can only wonder: 'how do I get through this reverse-lottery-win lifestyle; where I win $5 a year for a million years.'

"Nobody wants to cash out their life on this earth with the epitaph on their tombstone: 'I told you I was sick.' Yet, sadly, people keep falling for these scams every day--surrendering their identity, their savings, even their inheritance. Where will it all lead?"

Legal Thriller Author Reveals 24 Amazing Scam Artists' Conflict Resolution Steps

--Never explain; explanations only confuse issues. This is a basic scam artists' principle, a core part of their unconventional view of conflict resolution.

Fighting off skeptics as a means of "group control" is psychologically important to the scam artist.

In every group of victims, the scam artist's problem is that he must always be able to adequately "handle" those few skeptics who will emerge to plague him. A much different setting than when he's dealing with a single mark. Thus, his own interpretation of "conflict resolution" spells out as much different rules of engagement than that contained in any college curriculum. Here they are:

1. Always hide behind the conspiracy theory. Cite numerous cases of individuals, organizations, jealous competitors, and government agencies out to "get" you, through underhanded, collaborative means.

2. Never answer a direct question. Always confuse, exaggerate, distort, and obfuscate.

3. If your adversaries demand evidence of the claims you make to back you up, challenge them. Indignantly state that they cannot disprove your claims. If you act insulted enough by their accusations, they will be shamed. Some will even apologize for questioning your integrity.

4. When confronted by an incisive, direct question, bombard your opponent with an assault of meaningless questions in retaliation. (The captain of the Titanic knew an iceberg was close; how would you have saved the ship? When Columbus set foot on the new continent he thought he was in India. How would you have known the difference?) When your opponent ignores your hypothetical diatribe, and tries, instead, to get back on topic, accuse him of evading the issue. At this point his buildup of frustration and rage will work to your advantage. Your audience will now exude sympathy for you, for the mean-spirited badgering you've had to put up with.

5. Use the word, "analysis," often (Studied analysis. Thoughtful analysis.). This will give everything you say a sense of the seriousness you need to convey.

6. When things intensely heat up, make your opponent even more furious. Taunt him, unmercifully. With tempered, controlled delivery, make wild charges. When rage builds to the point he will call you "a liar," you have him cold. Now you accuse him of name calling. Do this in a distraught, but fatherly, understanding way. This will make your audience respond to you. They will think that it is you, not he, the one staying on topic, and they will sympathize with you for the verbal abuse you've had to suffer.

7. When your opponent has the audacity to demand evidence from you, to back up your claims, accuse him of being closed-minded. Piously claim that it is the broad-minded who, along with the meek, shall inherit the earth. This is another way to frame your retort that will gain you Brownie points with your audience who like to think of themselves as enlightened free-thinkers.

8. To the opponent who threatens to expose your proposition as a scam, the reflex is always automatic.. Loudly accuse him of being an agent of the "Big Conspiracy" trying to bury you. Proudly wave the cross you have to bear. Emphatically restate your cause--of constantly having to fight "them"--in a "these are times that try men's souls" tone of voice.

9. If the ultimate extreme becomes necessary, make your opponents paranoid. Tell them you have a file of evidence on them, that you have gathered, and are about to turn over to the police. They will think you are mentally deranged, but hesitate, nonetheless. (Was it the beer bottle I threw through a department store window when I was 12? Was it the indiscretion I had with a high school teacher when I was 17?) Keep them guessing. They won't know. Consequently, they will back off.

10. Be quick to patronize, exude sympathy. Label anyone who does not immediately agree with you ill-informed, uneducated, behind-the-times, or lacking vision.

11. You must always take the stance of being beyond reproach. Get a copy of the book, How to Lie With Statistics. Quote from it frequently, as if from a legal thriller book. Quote a "fact" you are trying to push. Never mention the title, of course, just remind your listeners that it must be fact, because it's quoted in a book.

12. Rigidly uphold your carefully-cultivated reputation as a "Visionary." Loudly insist, with rapid side-to-side head shaking for emphasis, that no proof exists that you are a scam artist. Accuse your detractors of spinning, spreading propaganda and malicious nonsense. Tell them you will "see them in court" before you will take further character assassination from them.

13. Use the "they laughed at," line frequently (They laughed at Thomas Edison, Alexander Graham Bell, Louis Pasteur, too.)

14. Use the force of exasperation to your advantage. (Do I have to prove that the world is round?)

15. Use the words, "it's common knowledge," often. Throw in quotes from dead people, who cannot refute you. Instead of baldly claiming, "Two-time Nobel Prize winner, Linus Pauling, endorsed my claims," combine the power of these three magic words with the power of quoting dead people, "It's common knowledge that two-time Nobel Prize winner, Linus Pauling, endorsed my claims."

16.. Ignore all facts. Never admit to a fact that might suggest, in any way, that your theories might be erroneous. Dig up a reference that supports you. There is always one out there somewhere, even if it only hints around the fringes that you "might" be right. Not to worry about vague wording. With scam artists' mastery you can always make this one little isolated piece of information sound like the Gospel.

17. Remember, the best means you have of proving a point is to trot out a whole list of these. From this list, from point 2 on, your points will be minor, insignificant, but factual. But the first one, your main point, will be a major supposition. which you are trying to sell by way of sneaking it in. Then, because your list includes many facts, when you get to the end of it refer to the supposition as a fact. This way your pre-conditioned audience will now accept everything you say as "fact."

18. Quote Abraham Lincoln and recount his travails, a lot. Implant the image of you as a likeness of "Honest Abe," firmly in the minds of your supporters. (President Lincoln found it hard to sign the Magna Carta. President Lincoln suffered mental torture when forced to his decision to let Grant send Sherman to burn Atlanta.) You can bring this theme to a heart-rendering point where it will almost bring tears to the eyes of your supporters.

19. Seize the initiative from your opponents. Describe yourself as a skeptic, suspicious of lofty claims, questioning all things illogical. Warn them, gravely, that they must always beware of scam artists. Proper nuance of this positioning will transition your borderline believers to firm believers.

20. Say your assumed name, the pseudonym you use, is Foster Snyder. Use it to refer to yourself in the third person. This will make everything you say sound more credible, more penetratingly factual. (Foster Snyder has observed the disquiet in academia. Foster Snyder thinks of the arts as being in a state of suspended dementia.)

21. Imprint, indelibly, on the minds of your followers, that you are a true "Visionary," therefore everything you say about the glorious future you are about to unfold for them is beyond question.

22. Use the word, "stalker." Use it repeatedly. (Didn't Foster Snyder see you in Cincinnati? Weren't you in a front row seat at Foster Snyder's speech in Seattle in January?) This word has such a negative connotation--as in assassinations, sex crimes--that this defensive stance will procure followers. If your followers believe you to be a victim of stalking by an agent of the "Big Conspiracy" you must fight. they will fall in line with protective vigor to back you.

23. Drop your head low, slowly shake it, sadly, lower your voice, and say of your detractors, "They just don't understand."This is the "trigger" point--to get your followers to flock to you, opening their wallets on the way.

24. As a postscript, steadfastly deny even the hint of truthfulness in your detractors debunking of you. Simply, assuredly, and in a soft voice, state that these sad, lonely people are not experts on the subject of your claims. So, how could they possibly have anything meaningful to say on the subject?

There you have it. Twenty four points of glibness the scam artist will use to distort, confuse, bewilder and set his opponents up, in his efforts to inspire you as to his "leadership," win you over. While much of his logic is like saying, if most car accidents happen within 5 miles of your house, why not move 10 miles away? you are puzzled, but swayed. When he says fat chance and slim chance mean exactly the same thing, you hesitate, think, then nod your head in agreement. Then, when he finally asks, would you rather be the pigeon or the statue?--the only thing he's said that you clearly understand--you eagerly fall in line. And, follow him to the "Promised Land."