29 Mar

Selling Your Soul to Usana Health Sciences for $27,000 a Year

If you were going to join a multi-level marketing company like Usana Health Sciences (NASDAQ:USNA), what would your goal be? Would you aspire to be one of their million dollar earners? That sounds awfully prestigious, doesn’t it?

Well check out this excerpt from a recent press release by the company, and then catch my comments at the end. Read More

25 Mar

The latest bailout scam

Yesterday Obama announced his plan for buying so-called “toxic” assets from banks. The stock market responded positively. Why? The taxpayers are footing the bill for the bailout (taking all the risk), while investors can get all the rewards.

From DownszeDC.org:

For every $100 used to buy “toxic” assets, private investors will put up only $7, while taxpayers will put in a matching $7 plus $86 in loans. These are no recourse loans. In other words, if a “toxic” asset doesn’t pay off, taxpayers will eat the loss — potentially $93 out of every $100 invested.

Investors get a chance to profit, while most of the potential losses will be socialized — paid by you.

Tell your politicians to say no to this!

24 Mar

Naked Short Selling: A Complete Waste of Resources

Patrick Byrne Naked Short SellingThe issue of Naked Short Selling stocks (NSS) is getting some airtime, thanks to the likes of loony Overstock.com (NASDAQ:OSTK) CEO Patrick Byrne. He’s a crusader for NSS, claiming over and over that the practice almost destroyed his company. The sad truth is that NSS didn’t really do anything to Overstock.com. Byrne and his incompetent staff ruined the company all on their own, without any help from short sellers.

Still, it makes for interesting bedtime reading. I always love a good conspiracy theory. Read More

23 Mar

Are We Really Getting Tough on Financial Fraud?

Consumer outrage about “bailout madness” and the proliferation of Ponzi schemes and investment fraud is fueling a push for greater oversight and regulation. The government is talking tough, saying that there will be more prosecutions for financial fraud forthcoming..

That sounds good, doesn’t it? Of course we’re all in favor for more aggressively pursuing those who swindle others out of their savings or cheat the system. But while more prosecutions make good headlines, how realistic is this goal?

Currently, the rate of investigation and prosecution is very low. There simply aren’t enough resources to investigate all allegations of fraud. Even cases with all the proof ready for prosecutors often don’t make it into court for a variety of reasons. Read More

22 Mar

Jurors tweeting?

Our laws have not kept up with technology. Social media like Twitter (with users posting “tweets” for others to read) and Facebook are having a big impact on life, and the impact on the legal system is yet to be determined. The one thing I’ve observed related to the legal system and social media is that lawyers usually overreact about these things.

Take the recent situation with a juror tweeting. Attorney Anne Reed at Deliberations has an excellent summary of the situation. Read More

17 Mar

Does a Down Economy Cause an Increase in Fraud?

Two weeks ago the Association of Certified Fraud Examiners sent out a survey to members, attempting to determine whether a bad economy makes fraud rise. I’ve written about this topic before, and the truth is that there is no way for us to know.

People suspect that a poor economy causes more fraud, but it’s absolutely impossible to determine if that’s true. It sounds logical, but at the end of the day, no one will be able to prove how many frauds were “caused” by the state of the economy. Adding to the difficulty is the fact that many frauds are never discovered, so it’s clearly impossible to determine the reason behind the (undiscovered) fraud. Read More

14 Mar

The idiots in Milwaukee government have finally won

Wisconsin is one of the highest taxed states in the nation. If you live in Milwaukee, you’ve got it even worse. All taxes are through the roof… highest sales tax rate, highest property taxes, most “fees” that are nothing more than disguised taxes…

Every time we turn around, a politician is looking for new ways to tax us and worse ways to spend that money. Somehow, Milwaukee politicians seem to think they’re entitled to take as much money from us as they want. (But then they cry when businesses don’t open in Milwaukee, providing jobs for the residents…) There are constant cries that the government just doesn’t have enough money to do what it NEEDS to do. That argument is slapped down time and again with proof like this… the fact that the public school system spends over $14,000 per child and they still can’t read.

For years the politicians have been fighting over the bus system, the Milwaukee County Transit System. As usual, the big spenders think it doesn’t have enough money.  The truth is that the system is under-utilized. Why? Well it’s not the cost. $2.00 is a cheap ride to anywhere in the city. Those in charge think maybe there aren’t enough busses running. (I say a little wait for a bus won’t kill anyone.)

But the economics of the bus system are such that it’s in danger of going under.  So instead of finding new ways to be more efficient, spend less money, and still offer the bus system to those who need it…. Mayor Tom Barrett instead has found new ways to waste tens of millions of dollars in a way which doesn’t enhance the city or the bus system.

For 17 years, politicians have been arguing about a “streetcar” system in downtown Milwaukee. What this would be is an add-on to the bus system which virtually no one would use, would cost a lot of money, and would duplicate services already provided by the bus system. Worse yet, it would be a “fixed” system. You can’t move it or use the assets anywhere else because the system is literally built into the street.

What happens once this is a miserable failure? Politicians say “oops, sorry for spending your money.”

The best indicator of whether such a system will be successful is the trolley car system that has run in downtown during the summers. Its biggest success is running empty trolleys around downtown. Why does that happen? They’re not needed or wanted in the heart of downtown. Just as this streetcar system is not needed or wanted.

The pork in the latest bailout bill includes handing $91.5 million to Milwaukee. 60%, or $54.9 million goes to the streetcar system and the rest goes to the bus system. Mayor Tom Barrett is claiming that the system will “spur development” in downtown Milwaukee. And anyone who lives or works there knows we don’t need development “spurred” there. It already has plenty of development, and it’s easy to get around down without this waste of money.

You should also know this streetcar system can’t run in the winter. So it will be useless 4 to 6 months out of each year.

So there you have it. An inflexible system that is useless for a big chunk of the year, can’t be moved anywhere because it’s built into the street, is incredibly expensive to build at about $25 million per mile, isn’t wanted by the people, and won’t be used. What a way to spend our taxpayer dollars.

12 Mar


entrepreneur10 Potentially Sticky Work Situations and How to Manage Them

Entrepreneur Magazine
By Chris Penttila

As an entrepreneur, you’ll run into sticky situations at work, whether it’s grumbling employees or distractions, that get in the way of productivity.

Dealing with weirdness in the office is never easy, but it’s essential to running a successful company. “Human resources problems that get ignored have a really nasty habit of not going away,” says Margaret Hart Edwards, a shareholder at employment law firm Littler Mendelson.

Never fear: The experts are here to offer their advice for handling 10 sticky HR situations that might otherwise leave you floored and fumbling.

Reasons 1 through 9 are found at Entrepreneur.com.

10. An employee is taking advantage of company money or equipment
Unfortunately, every employer will have employees who secretly take from the company. In fact, hidden employee fraud filches 7 percent of a company’s revenue every year, according to the Association of Certified Fraud Examiners. “The dollars lost to fraud can grow quickly,” says Tracy Coenen, a forensic accountant and the author of Essentials of Corporate Fraud.

Employee pilfering increases in tough times, when an employee might take home a roll of paper towels or buy unnecessary office supplies just to get a free $20 coffee card. Coenen suggests writing a clear fraud policy that educates employees about what’s unacceptable.

For larger cases of fraud, Coenen advises small-business employers to contact a fraud investigator and an employment attorney for legal advice. “The worst thing a company can do,” she says, “is ignore a fraud problem.”

11 Mar

In Agreement: Overstock.com Sucks and Patrick Byrne is Wacky

Patrick Byrne, CEO of Overstock.com O.coI’ve written plenty here about perpetual money-loser Overstock.com (NASDAQ:OSTK) and its wacky CEO Patrick Byrne. Unfortunately, I’ve mostly lost interest in the topic. Why? It’s the same old, same old.

Overstock.com continuously loses money for shareholders. Byrne pretends that profits are right around the corner. More money is lost. Dishonest accounting tricks are used to pretend the company made money. Financials are restated. More money is lost. Financials are restated again. More money is lost…

You see a pattern, I hope? Read More