Is Food Babe a Fraud?

vani-hari-food-babe-fraudI have Facebook friends who regularly “like” posts by Food Babe Vani Hari.  She has a cult-like following of people who listen to her as she screams bloody murder about all sorts of food.  FoodBabe, known to some as a “food activist,” loves to talk about all the chemicals and toxins in the food we eat. Sounds great, right? We all need to be more aware of what we’re eating!

But it’s not quite so simple. Food Babe (Fraud Babe?) isn’t doing this out of the goodness of her heart. This is a business, people.  Paranoia and hysteria bring readers, readers bring revenue. It’s just that simple.

I’m not against anyone making a money, but I think it is important to look at how that money is made and what actually makes the “expert” an expert. More particularly, is someone a blogger who claims to be an expert? Or is someone an actual expert who just happens to blog?

FraudBabe is a self-annointed expert (who as you will see, is no expert at all) who makes money via pay-per-click advertisements (you click on an ad, she gets paid), affiliate links (she makes money when you click and buy), the sale of her “eating guide,” and speaking engagements.

Read moreIs Food Babe a Fraud?

Seeing the Signs of Fraud

Would you recognize the clues that you (or your client) have been ripped off by one of your employees? Or would management conduct business as usual, blindly trusting the employees?

Companies make the mistake of not actively searching for fraud. They tend to trust their employees and trust the procedures in place to safeguard company assets. It may be good business to trust employees and empower them to make real contributions to the growth of the company. However, it is not wise to turn a blind eye to signs that a trusted employee may be stealing.

An unexpected increase in affluence may signal an employee with sticky fingers. Favorite toys of fraudsters include new Harley Davidson motorcycles, luxury vehicles, and high-end watches. Those things are easy to spot, although management doesn’t always think through the implications.

Behavioral changes can also point toward a guilty conscience. Changes in activities such as starting or quitting time, without any obvious business reason, could be problematic. Non-compliance with established policies and procedures can also be problematic.

Read moreSeeing the Signs of Fraud

TSA Agents Demand to Pat Down Passenger AFTER His Flight

Via Amy Alkon, the stupidity of this speaks for itself. Kahler Nygard had “SSSS” on his boarding pass, which means he should have gotten extra groping from TSA in the security line BEFORE his flight. Someone decided he didn’t get enough groping, so TSA met him when he exited the plane at his destination. Nygard … Read more TSA Agents Demand to Pat Down Passenger AFTER His Flight

“MLM Lawyer” Sued For Legal Malpractice

MLM Lawyer Kevin Grimes
MLM Lawyer Kevin Grimes

This may be old news to some of you, but I’m finally getting around to writing about it. In June 2014, the receiver in the Zeek Rewards Ponzi scheme case sued the infamous MLM lawyer Kevin Grimes (and his law firm) for legal malpractice, negligence and breach of fiduciary duty. The lawsuit initiated by receiver Kenneth Bell names Kevin Grimes and the law firm Grimes & Reese PLLC, and alleges damages of $100 million. (A separate lawsuit against Howard Kaplan also makes similar claims.)

The lawsuit alleges that Grimes knew or should have known that Zeek Rewards “…was perpetrating an unlawful scheme which involved a pyramid scheme, an unregistered investment contract and/or a Ponzi scheme.”


The Securities and Exchange Commission sued RVG Venture Group, LLC (dba ZeekRewards) in 2012, alleging that it was a $600 million Ponzi scheme (also called pyramid scheme). Of course, up until that point, participants in the multi-level marketing industry were claiming that ZeekRewards was a legitimate and legal MLM. (That’s what the lawyers said, anyway!) The company was forced into receivership later that year, with the receiver seizing assets to attempt to pay back victims of the scheme.

Read more“MLM Lawyer” Sued For Legal Malpractice

Proof that Herbalife Sucks

mlm-scheme-pyramidI have researched multi-level marketing companies for nearly a decade. During that time, I came to the conclusion that the vast majority of participants fail. What does that mean? 99% or more lose money. Since the participants are largely getting in because of the “business opportunity” to “earn unlimited income” and find “financial freedom,” failing to turn a profit is indeed a failure.

A few weeks ago, a wonderful article on Herbalife was published on Seeking Alpha. It started out by discussing hedge fund manager John Hempton’s blind (and incorrect) defense of the Herbalife business model. In essence, he claims that since meal replacement shakes are sold, this is a legitimate business opportunity.

This is the defense that every MLM company uses. “We have a product. People buy it. Therefore we are not a pyramid scheme.”

Read moreProof that Herbalife Sucks

MillerCoors Fraud: Embezzlement by Executives Colluding With Vendors

millercoors-fraudLast week MillerCoors filed suit against 14 individuals and 15 companies, alleging over $10 million was stolen from the company. The claims include civil theft, fraud, breach of fiduciary duty, unjust enrichment, civil conspiracy and racketeering. Former MillerCoors executives David Colletti (vice president of on-premise marketing) and Paul Edwards (director of on-premise channel marketing) are accused of masterminding the fraud for a period of at least 13 years.

The alleged fraud is a billing scheme, in which the company made fraudulent disbursements. One component of the fraud was a shell company scheme.  The lawsuit claims that David Colletti and Pamela Colletti created a fake company which billed MillerCoors for goods and services never provided. The other component was an overbilling scheme, in which legitimate companies billed MillerCoors for goods and services not received. The participants in the schemes allegedly shared the funds paid by MillerCoors.

Read moreMillerCoors Fraud: Embezzlement by Executives Colluding With Vendors

Stopping Fraud Before It Starts

My idea of a good time: Digging through boxes of documents for hours on end, looking for that smoking gun that proves an employee was stealing from a business.

An attorney’s idea of a good time: Going to court with the expert witness who proved the employee was stealing, and burying the guilty party with a verdict in favor of the client.

The client’s idea of a good time: Having employees who don’t steal from the business in the first place.

Let’s face it, dealing with employee theft is no picnic. And while I certainly don’t mind making a living busting thieves, it’s always disheartening to see business owners put in a bind because of someone’s sticky fingers.

Read moreStopping Fraud Before It Starts