BrokeAndBroker by Bill Singer WEEK IN REVIEW

May 30, 2015

Hundreds of Thousands Defrauded In $50 Million Text Messaging Scam

On May 28, 2015, the United States Attorney for the Southern District unsealed a criminal Complaint charging six Defendants with count of conspiracy to commit wire fraud; and three of the six were additionally charged with one count of conspiracy to commit money laundering. The Complaint (available in FULL-TEXT at that the Defendants charged hundreds of thousands of mobile phone customers over $50 million in monthly fees for unsolicited text messages during 2011 and 2013. The fraud was accomplished through "auto-subscribing," which is a scheme by which consumers were charged for premium text services for such content as horoscopes, celebrity gossip, and trivia.  READ

If there is a shortcut through the forest of continuing education, a detour around career qualification exams, or any way in which to avoid and evade the obligation to sit and take a test, someone has tried it. If it worked, we probably don't know about it. If it didn't work, the cheater was likely caught and his or her epic failure is frequently on public display. In a recent regulatory settlement, we have the case of a aspirant to a career on Wall Street who needed just a little more support than the rules required -- sadly, that crutch cracked and the person leaning on it crashed to the ground. READ

FINRA Says Charity Does Not Begin At Home

Ever the wordsmith and societal critic, author Charles Dickens is credited with saying that "charity begins at home and justice begins next door." Frankly, an intriguing turn of a phrase and one that gives us much to ponder. In a recent Wall Street regulatory settlement, we have the case of a somewhat misguided and errant youth, who seems to have taken Dickens' admonition as a challenge.  READ

If Hillary Clinton could use a personal server for her emails, why can't a registered representative use an AOL email account? Then there's the whole other issue about why a registered representative needs permission to personally invest in deals away from his or her firm. Consider this recent case in which the use of a personal email address and personal investments becomes a regulatory issue for FINRA. READ

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