Thursday, October 14, 2010

Always, Always, Have Checks and Balances In Place

As the tragic story Amplified here shows no one is immune from being duped out of their money. It seems now it's John Elway who has been taken in yet another Ponzi scheme. That is why you can trust those who you use to advice you in important business matters but don't let that trust go so far as to not have checks and balances in place.

John should have done as I've always advised clients to do and had at least notification in place on this so called trust fund account. Anytime a fund like this or any other fund containing money that others have access and control over is established you need to have monitoring and supervision in place on that account.

Set up right John could have verified that all the money went into the fund and be notified of any attempt to make withdraws or changes to the account. For failure to do that simple thing now he stands to lost millions.

So remember if your investment cost more than a Starbucks coffee have some protections in place that allow you to verify what's going on so you're not being stolen blind.

Amplify’d from sports.yahoo.com

Hall of Fame quarterback John Elway and a business partner invested $15 million with a hedge-fund manager who was recently arrested for running a Ponzi scheme.

The Denver Post reported that the two invested $15 million with Sean Mueller in March with the understanding that the money would be placed in a trust until a final decision was made about where it would be invested. 

About 65 people had invested $71 million with Mueller over the past decade. Yet in April, Mueller only had $9.5 million, according to a state investigator. He turned himself in to authorities on Wednesday on charges of racketeering, securities fraud and theft, and is being held in prison on $2 million bond.

Elway and his partner have asked that their claim be processed ahead of any other investors' because their $15 million was supposed to be placed in a trust, not pooled with the money of the rest of the hedge fund. According to an April filing, $12 million of Elway's money was placed into a Morgan Stanley trust account, as expected. The other $3 million has gone missing.

Read more at sports.yahoo.com
 

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