Last week, Reason Magazine ran an excellent article entitled “General Motors Will Never Repay Taxpayers.” I don’t really have anything to add in the way of commentary, but wanted to reprint some of the information here for your enjoyment.

I was against any and all bailouts from the very beginning. I truly believed that the markets should be allowed to work. If one or more of the automakers had a business model that could not survive in today’s economic climate, than it should have been allowed to die. There would still be demand for cars that would need to be made up somewhere, and another car company would have filled that need (at little or no cost to the taxpayers).

I thought it was a hoax. Surely this couldn’t be true? An actual college, offering a curriculum in “network marketing”????

You know – - network marketing – - as in multi-level marketing, as in legalized pyramid schemes. Yes, folks, it’s true. Bethany College in Kansas is going to be offering a curriculum in professional scamming!

But if a college is going to be teaching this network marketing, multi-level marketing stuff to students, then it has to be legit, right? Wrong.

I have no idea what would possess any educator to think that they ought to spend valuable classroom time teaching this type of legalized scam to students as if it was a legitimate business pursuit. I can only assume that the powers that be, namely one Robert Carlson, M.B.A., professor and chair of business, has done no research on MLM and has no idea how these scams operate. He says about the new network marketing stuff:

If there is any quicker way to bring negative attention to negative news, I don’t know of it. Joseph Rakofsky seems to have a lock on ruining his own career by “suing the internet.”

It all started with Rakofsky, a new-ish lawyer who was representing Dontrell Deaner in a murder case in Washington, D.C.  The Washington Post reported in its article D.C. Superior Court Judge Declares Mistrial Over Attorney’s Competence in Murder Case:

Yes, I’m quitting Twitter. After 2.5 years, 2,154 followers, and 2,917 tweets, I have officially called it quits on Twitter. And I believe other professional services firms – - accountants, auditors, lawyers, engineers, etc. – - should do the same. Stop wasting your time on Twitter and get back to generating new business and goodwill with your existing clients.

What do I know about Twitter or web marketing?
Why should anyone listen to me? I’d like to think I’ve got a pretty good handle on using the web to generate new business and create professional relationships, at least in the professional services space. Accountants, auditors, and lawyers should listen to me because I know how to get results.

Here’s the proof: I’ve been a solo practitioner in a niche practice (fraud investigation and forensic accounting) for over 11 years. Today, my website is ranked third in traffic for forensic accounting firms. The two ahead of me (and several of the firms behind me) have hundreds of employees around the world. 

Hundreds of thousands of Americans get sucked into Multi-Level Marketing (MLM) companies each year. From Mary Kay to Amway to Herbalife to PrePaid Legal, the list is seemingly endless. Each offers its own special spin on the products it sells, but the main focus of an MLM is on recruiting new members.

MLMs live and die by the recruitment of new members, who make the bulk of the product purchases from the company. Little of the product is resold to an actual end user, but the MLM company doesn’t care. The sale has been made to the distributor (or associate or representative or member or consultant or whatever term you like).

Earlier this week,i-Sight Investigation Software posted an article based on an interview with me, Stop Fraud at the Door Before it Enters your Organization.

Making a bad hiring decision is sometimes only a minor inconvenience and a waste of time, but in many cases, it can leave you vulnerable to workplace fraud. One bad apple can wreak havoc in your organization and open you up to theft, legal trouble and even bankruptcy. In today’s litigious environment, it’s more important than ever to stop fraud at the door by conducting background checks on potential employees before making a job offer.

We interviewed Tracy Coenen, forensic accountant and fraud investigator, on the strategies for hiring people with high ethical standards as part of a company’s fraud prevention program.

In Chapter 7 of Dr. Jon Taylor’s book, The Case (For and) Against Multi-Level Marketing, he details the failure rates of participants in multi-lievel marketing companies. In order to analyze the true failure rates and to calculate actual profits or losses from participation in these (improperly termed) “business opportunities,” it is necessary to wade through confusing and incomplete disclosures and to estimate figures that are critical but not provided by the companies.

Dr. Taylor completes a thorough analysis of the numbers. Of the hundreds of multi-level marketing companies active in the United States, Dr. Taylor could find income disclosure statements for only 30 of them. What are the others hiding?

The analysis of these 30 income disclosure statements was completed through the following process:

Yesterday i-Sight Investigation Software posted an article based on an interview with me, Walk the Walk: Preventing Workplace Fraud Starts at the Top.

When it comes to workplace fraud prevention, actions sometimes speak louder than words. This is one of the key messages that forensic accountant and fraud investigator Tracy Coenen wants people to get when they are looking at ways to reduce fraud in their organizations.

When we interviewed Coenen on the subject of preventing workplace fraud, she stressed the importance of developing a culture of integrity in which employees know what’s acceptable and what isn’t, and ensuring that the actions of management reflect this culture.

In a follow-up to her original article about whether Isagenix is a scam, Harriet Hall, M.D. prints some of the criticism she got and her responses. This article was originally published at the Skeptical Inquirer website.

Defending Isagenix: A Case Study in Flawed Thinking
Volume 35.1, January/February 2011

Do those who comment on blogs even read the articles they are responding to? Here is a case study in emotional thinking, ad hominem arguments, logical fallacies, irrationality, and misinformation.

The Internet is a wonderful medium for communicating ideas and information in a rapid, interactive way. Many online articles are followed by a section for comments. Like so many things in this imperfect world, comments are a mixed blessing. They can enhance the article by correcting errors, adding further information, or contributing useful thoughts to a productive discussion. But all too often the comments section consists of emotional outbursts, unwarranted personal attacks on the author, logical fallacies, and misinformation. It provides irrational and ignorant people with a soapbox from which to promote prejudices and false information.

Multi-level marketing company Isagenix offers a cleansing product which it claims helps people lose weight. Is this MLM scheme offering a bogus product, or is this a legitimate weight loss program?

Let’s start off by clarifying that in general, multilevel marketing companies are legal scams in the United States. The government allows them to exist and multiply. They offer products which are little more than a “front” for the schemes, since without a legitimate looking product or service, the companies would be at risk of appearing to be illegal pyramid schemes.

In this article, we are not focusing on the MLM method of selling an opportunity or product. We are looking at the product itself.  Isagenix has its roots in colon cleansing products. These are detoxification products which they claim help people lose weight. The company also offers vitamins, supplements, and anti-aging products for the skin.