Defenders of multi-level marketing (MLM) will tell you that some companies “do it” right, while some companies “do it” wrong. One such example is John Hempton, a clown who thinks that Herbalife is the greatest thing since sliced bread. He says the following in an article about Nu-Skin:
Disclosure: I am predisposed to believe that multi-level-marketing schemes like Avon, Herbalife or Nu Skin are likely to be good cash generative businesses. I have done much looking at Herbalife and got very long. I do not think a negative interpretation of Herbalife is sustainable. Herbalife’s business is legal, sustainable and will generate vastly more cash in five years. Nu Skin does not lend itself to such definitive opinions. History is littered with MLMs that no longer exist – and a few like Avon, Nu Skin, Herbalife, Amway and Mary Kay which have lasted decades.
The fact that a multi-level marketing company like Mary Kay Cosmetics has been around for more than 50 years does not define whether it is a fraud or scam. Remember Enron (in business more than 15 years prior to the fraud being discovered) and Bernie Madoff (whose investment firm was in business for more than 40 years before his Ponzi scheme was revealed)? Length of time in operation has nothing to do with whether something is a scam or a fraud. Being traded on the New York Stock Exchange is not an indicator of legitimacy either.Continue reading
More than ever, competent and dynamic expert witnesses are critical to winning legal cases. Even if a case doesn’t go to trial, a credible expert can be the key to settling the case for your client. I believe that an expert witness has the opportunity to make or break a case. We all know that there are few chances to fix a bad opinion when you go to court. There is one chance to express the correct opinion and support it fully. A faulty opinion, or one with little reliable support, can doom a case.
Some attorneys have their preferred experts, while others get referrals from colleagues. Each attorney works with an expert witness in the way that she or he is comfortable. However, it never hurts to hear about it from the other side. This is my perspective on best utilizing your expert witness to her or his full value.
Finding the Right Expert
The most critical part of working with an expert witness is finding the right one. Naturally, the selection of an expert involves the evaluation of education and credentials. The examination of an expert’s credentials is a particularly critical process.
There are credentials that are earned through a bona fide process, such as the CPA (Certified Public Accountant), CFF (Certified in Financial Forensics), CFE (Certified Fraud Examiner), and CVA (Certified Valuation Analyst). Then there are credentials that are meaningless because they are simply purchased, none of which are even worth mentioning. It is important to research which credentials truly enhance the credibility of the expert.Continue reading
When a divorce is pending, it is not uncommon for one of the parties to manipulate the finances. Tracy discusses some common items that can be manipulated such as salary, selling assets to related parties, and more.
Despite all the warnings about tax scams, consumers are still falling victim to these types of fraud. Tracy Coenen talks on CNBC about the top five tax scams that consumers should be aware of.Continue reading
A collection of annual income disclosure statements published by multi-level marketing companies, continuously updated.
Some MLMs release income disclosures or earnings disclosures. These numbers are not required to be disclosed in the United States, but some of the companies do it anyway to appear transparent. The disclosures theoretically provide insight into how much distributors earn in commissions or overrides, but they are generally worthless. They are worthless because of what they do not disclose.
Multilevel marketing companies purposely omit important information that would allow potential distributors or investors to have real insight into these plans. In general, earnings disclosure statements often fail to provide the following information that is critical to understanding the plans and the results:Continue reading
Income tax returns and supporting information such as W-2s and pay stubs are the most common and basic documents which evidence income in family law cases. This article discusses the sources of income that are disclosed on a personal income tax return (Form 1040), and some ways the items can be evaluated to search for hidden income and hidden assets.
Wages – The figures reported on the income tax return should be matched to the W-2. The W-2 and the pay stubs will provide additional information on the employers, pay rates, total pay, certain benefits, and taxes withheld. Additional analysis may include tracing bank deposits to ensure that all wages were used for the benefit of the family.
Taxable Interest and Tax Exempt Interest – These items of income must be considered when calculating income available for support. They are also important because they can point to bank, investment, and brokerage accounts that may not have been specifically disclosed in the family law case.
Family Law Attorney Miles Mason discusses the kinds of documents that may be used to verify income in divorce and child support cases. These may include tax returns and related forms, but can also include things like financial statements, loan applications, or evidence of spending.
Forensic accountants and Certified Divorce Financial Analysts often use Quicken personal financial software to complete the lifestyle analysis in divorce cases. Unfortunately, Quicken is not the best option for accurately and thoroughly analyzing a couple’s finances before and during divorce.
Why is it used so often? For years, Quicken was one of the better options available for compiling and analyzing personal finances. Also, since a fair number of consumers use Quicken to manage their finances, divorcing spouses sometimes provide a Quicken file to the attorney, which may be used as a starting point for the lifestyle analysis. The drawback to this is that clients don’t always keep accurate records, and the Quicken file is often incomplete or just plain wrong.
Quicken software should not be confused with QuickBooks software, which is a software package used for small business accounting. QuickBooks can be used effectively in divorce financial analysis, while Quicken is much more limited and does not produce as good a result in terms of accuracy or usability. Note, however, that even QuickBooks may not be the best option for litigation purposes.Continue reading
The skills of a forensic accountant can be useful in bankruptcy cases. In this video, Tracy talks about a case in which she was retained by a creditor to examine the finances of the debtor. There were allegations that the debtor concealed material facts about its financial position when it originally applied for credit, and that certain disclosures in the bankruptcy filing were fraudulent.