UBS apparently offers some investment accounts for which the fees can constitute an effective $8,800 per trade. They’ve been sued by the New York Attorney General and will now pay $21.3 million to settle those charges.

I can’t help but wonder, taking all the fees charged in the 3,000 affected accounts, and subtracting the $21.3 million fine, if the investment company still comes out ahead. One customer in the example was charged $35,000 in fees. If we assume that’s high and go with an average $20,000 for all of the 3,000 accounts, that’s a total of of $60 million.

I could be way off on the average fees, but $21.3 million no longer seems like a stiff penalty. It’s more like paying extra tax on the income.

Meanwhile, I’ve paid no outright fees in my investment accounts over the past few years. I hope that when I’m 91 years old, I’ll still have the mental faculty to avoid being suckered into bad deals. More importantly, I just hope I live that long and maintain any sort of mental faculty at all.

UBS Settles Fee-Based Charges for $23.3 Million [Marketwatch]

Chuck Jaffe, a writer with MarketWatch, set his sights on the Teach Me to Trade seminar last year, and ordained the event his “Stupid Investment of the Week.” This year, he attended Robert Kiyosaki’s “Rich Dad Academy,” and came to the same conclusion.

Robert Kiyosaki, whose advice is short on concrete ideas, has built an empire with his Rich Dad, Poor Dad series of books, videos, and board games, has developed a series of seminars. This is particularly ironic since his philosophy eschews education in all forms. Here’s what Jaffe has to say about this experience in the teaser seminar.

The free come-on seminar was pitching the most basic training basic real estate course, one which focuses on taking advantage of foreclosure situations and distress situations to find ways to finance your deals. While Huffman showed a diagram with 11 different three-day training courses—and he mentioned the possibility of hiring a mentor instead of going to the classes at all—the focus was just on doing the one class.

Most people might have thought they were getting a one-and-done deal and at a significant discount (attendees at the free seminar were offered the chance to register for the class, normally $995 online, for just $495). But there’s little doubt that one training seminar will lead to hard-sell pitches for others. Several members of the audience had previously paid for Rich Dad training; interestingly, the three I talked to said they have yet to turn a profit, but expect to soon.

The seminar leader focused on foreclosures, which are seen as a surefire way to make quick money thanks to the sub-prime mortgage meltdown. But there are still lots of foreclosed property shoppers as well, and competition in the marketplace is making these “investments” less favorable.

Jaffe ends with this:

Clearly, everyone who liked Huffman’s pitch and bought Rich Dad Academy training has the potential to be the next success story, but most won’t be; Kiyosaki’s advice—however flawed some people find it—has worked for at least a small-but-dedicated group of followers.

But that success story is not likely to be the “average” attendee, but rather the exceptional one, the person who dives in with a passion and single-mindedness that stand out from the crowd.

The introductory seminar was free, and you get what you pay for. If you want to learn the “66 Ways to Find Bargain Properties and Motivated Sellers” and “17 Key Internet and Realtor Search Criteria,” you have to attend a three-day seminar with the price of $1,000. Attendees were given the “opportunity” to buy their tickets for “only” $500 a piece.

Before you pay for a seminar you must do your due diligence. Ask about the success rate of people who have taken the class. If you can’t get accurate information—or worse, you’re mocked for asking a valid question—pass on the seminar. There’s no need to fatten Kiyosaki’s wallet.

A common theme in seminars, whether it’s the get-rich-quick type or the change-your-life type, is the instruction to dismiss any contrary arguments as not valid. I see that is what Jaffe experienced in this seminar. That’s also what I experienced when I was strongly suggested to attend a Landmark Education Forum. Anyone who disagrees with the effectiveness of the “education” “just doesn’t understand.”

“Rich Dad Academy” a Poor Choice for Investors [MarketWatch]

The Chief Executive Officer of Whole Foods, John Mackey, has been posting on internet message boards, promoting his company’s stock (example) and pointing out the faults of others in the same category (example).

I find it unlikely that a few messages affected the stock’s price to a significant degree, but that’s not the point.

Is posting on message boards part of the job for the CEO of a large corporation? Personally, I don’t think so. There should be more important matters for him to attend to. At the very least, he should have disclosed his relationship with the company in his posts. Doing so would inform unsuspecting readers of his access to insider information and his particular biased point of view.

Not only does Mackey spend time on the message boards, he also keeps a blog and finds more time to argue with his commenters.

If the CEO of the company for which I work was spending his time posting anonymously on message boards, I’d be questioning the millions of dollars he’s getting paid in salary and stock to do so.

This isn’t the first time, but now the State of Florida Office of the Attorney General is investigating FreeCreditReport.com. You’ll notice I don’t link to the site. This site, run by credit reporting agency Experian is taking advantage of the ruling that anyone can receive a free annual credit report from each of the three major agencies.

FreeCreditReport.com is not the website that offers free credit reports in conjunction with this directive. It’s misleading, and here’s the fine print on the site:

When you order your free report here, you will begin your free trial membership in Triple AdvantageSM Credit Monitoring. If you don’t cancel your membership within the 30-day trial period, you will be billed $12.95 for each month that you continue your membership. If you are not satisfied, you can cancel at any time to discontinue the membership and stop the monthly billing; however, you will not be eligible for a pro-rated refund of your current month’s paid membership fee.

FreeCreditReport.com has been investigated by the Federal Communications Commission (FCC) and has been required to pay a significant penalty. However, they apparently have been allowed to keep operating.

The only way to get your free annual credit report is by going through AnnualCreditReport.com.

Hat tip to Red Tape Chronicles for the news about the Florida AG investigation.

I just found this in my inbox (for an email address that wouldn’t be used for anything official):

Subject: IRS Notification – Please Read This .
From: Internal Revenue Service

After the last annual calculations of your fiscal activity we have determined that you are eligible to receive a tax refund of $63.80. Please submit the tax refund request and allow us 6-9 days in order to process it.

A refund can be delayed for a variety of reasons. For example submitting invalid records or applying after the deadline.

To access the form for your tax refund, please click here

Regards,
Internal Revenue Service

Needless to say, I didn’t click there. If I had, I would have been taken to a website on a server named arcdoors.com. The whole thing sounds pretty phishy too me.

You would be surprised, intelligent people fall for these things all the time. Out of curiosity, I clicked on the link they sent. As you can see if you click on the thumbnail below, the site looks legitimate. Don’t fall for this scam.

By the way, you know this can’t be legitimate because the scam email promises to process the request in 6-9 days. The real IRS is not nearly as efficient as the scammers and wouldn’t be able to make any such guarantee.

As you may know, I’ve resigned my current lease and I’m no longer looking for a new apartment. Back in early June, I described the best and most affordable apartment I found. I also described how they advertised the unit as being available July 1. After showing us the apartment, they mentioned it wouldn’t be available until August 1, past the end of my lease.

While I felt deceived, perhaps it was an honest mistake. Regardless, I put down a $300 refundable holding fee and a $40 non-refundable application fee. For a variety of reasons, we decided not to take the apartment, and I expected to receive the $300, which I paid in cash, back promptly.

What a mistake that assumption was. What follows is a detailed account of what I went through, more for my own records, but feel free to read and comment on my experience. Read the rest of this article »

Wonderful. After reading Ben Stein’s column, which I mentioned earlier today, I came across Robert Kiyosaki’s latest on Yahoo Finance, Lying is Easy, Wealth Takes Work.

Let’s just start right at the top: Read the rest of this article »

I can’t believe I’ve spending so much time working towards my second degree. I could have made the process much simpler. What I can only assume is a reader sent me the following advice:

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