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An Employment Scam in the Financial Services Industry > HOME
BIG FAT LEGAL DISCLAIMER : This site represents my OPINIONS, i.e. what I have come to BELIEVE based on over a decade of research, and should under no circumstances be construed as condemning any company of wrongdoing unless I've so noted a legal case or opinion that indicates such. Only a court is qualified to make such a decision, hence it is so important for victims to get their cases on the books. Such legal notations here should not be interpreted as being all-inclusive; I've quoted only enough to make my arguments. Nothing on this site should be construed as taking the place of the advice of an attorney. It is up to you to do your own research, come to your own conclusions, and make your own decisions. Lastly, the opinions of all sources quoted remain theirs and do not necessarily represent the views of this site.
BIG FAT LEGAL THREATS : As of October/November 2009, this site was threatened by two legal threats, the first ** alleging I've somehow directly accused his company of running a scam despite the many disclaimers clearly stating that this site personally accuses no specific company of running it, and the second *** alleging that this entire site is somehow illegal and thus must be taken down. In January 2010 I won the first case.It remains to be seen if the second case actually materializes given it's a virtual carbon copy of the first.
A stable job with a future, or a scam that will leave you penniless? Sometimes it's not so easy to tell!
Due to expansion, nationally respected firm is seeking career minded individuals who desire training in all aspects of operating a branch office. Excellent career opportunity to earn $50,000 first-year management income. Prior experience desirable but not necessary. Call (XXX) XXX-XXXX for immediate interview.
The above ad is NOT real. The author made it up as an example.
Any resemblance to anyone's actual ad is coincidental .
Sounds reasonable enough. You apply. Your interviewer advises you that the average rep in the industry makes over $100,000 a year, not just the low-end $50,000 advertised, and the firm will help you get there quickly. The risk sounds reasonable. You agree to pay over $700 for your licensing/background check, and in spite of your lack of experience, you are hired. You note upon the first day of the training class that the ten other new hires are primarily young and inexperienced. You stick it out and pass your exams; now you are told to create a list of friends and family that will serve as your leads, and you memorize a sales script. After six months of being a "star performer" slaving 60+ hours a week, you have grossed less than $5000, and a good portion of that has been depleted by "business costs" revealed to you only as they cropped up. Your leads are drying up. The help you were promised is now minimal as your manager focuses on attracting and training new reps. The vast majority of your original class has left(as well as even many reps hiredafteryou), and you finally decide that the job involves far more risk than was represented to you. Although you signed a Non-Compete Agreement indicating that you must leave your clients behind when you leave, you still expect the commission trails from those clients' investments to continue to help support you while you seek new employment. You quit. The commission trails never come.
You're not alone.
I've just describedone victim's experience* . In fact, this is one of theless extremeexamples.
Some reps leave heavilyin debtbecause they've been convinced to pay as much as $75,000 for the licensing/background check as well as the firm's
"exemplary" training classes. They may even have been advised to "fake it till you make it" and maxed out credit buying expensive business attire and a car beyond their means just to project a successful (but false) image.
I am not describing the many legitimate financial services positions in which it takes months to establish a clientele but ultimately pays off. In a legitimate job, the risks are disclosed up front. With a scam job, the scammer deliberately misleads reps about the job's true earning potential and then profits on them till they are forced to quit for lack of income, and then continues to profit even after on their commission trails. In fact, it sets up the recruits to fail, much like many of today's illegal MLMs and pyramid schemes , continuously mining an inexperienced work force who is willing topayto get "trained" to make a "fabulous" income and leave their hard-won clients behind as they fail.When the above-mentioned rep and over a dozen others sued the firm for fraud, the firm defended itself by pointing to its official corporate literature, which described an average rep being expected to earnonly about $12,000 his first year !* Of course, each rep claimed to have never been informed of this. The Internet is rife with such complaints.
And the scammers don't just mine new college graduates and similarly inexperienced job hunters. Victims have included seasoned former attorneys, IT professionals, and even financial industry professionals seeking an exciting new opportunity. Perpetrators of these types of scams have become increasingly clever to avoid detection, and ultimately, prosecution. The law has yet to catch up.
WhileI can take no responsibility for a decision that is ultimately someone else's to make , my goal is to help NEW COLLEGE GRADS and THOSE NEW TO THE FINANCIAL SERVICES INDUSTRY to enter the field forewarned with what I believe to be critical information, to aid those who have been defrauded, and to do my part to help end the scam.
Note that if you came here looking for evidence that a particular firm is involved in the scam, you willnotfind absolute proof here . I am not interested in getting sued(hence I have NEVER accused ANY company on this page of running this scam)** / *** ; I am interested in imparting information I believe is helpful to researchers, and guiding potential fraud victims. The next pages describe an overview of the scam and then examine the components in detail as far as I can make them out.
* Cases were found in public court records.
NOTE: The financial services industry is one of SEVERAL that has been directly influenced by the MLM (multilevel marketing) industry -to its detriment, hence this site exists at all. If you are considering employment in a sales job of any sort in which you will be classified as an independent contractor (particularly in the real estate, financial services, delivery, taxi, personnel staffing, and auto rental industries), you will benefit from reading this site in its entirety and understanding the MLM connection.Chances that you will fail are extremely high , but you may miss your window of opportunity for recovery if you spend too much time blaming yourself when you have in fact been defrauded.
I've compiled the truth about MLM into this site's opinion article conveniently called "ALL YOU NEED TO KNOW ABOUT MLM: IS MLM A SCAM?",which educates jobseekers and consumers on the big picture: how MLM's questionable legality was established, why it continues to flourish despite defrauding millions of consumers, andhow it's silently spread to other industries (including financial services) to defraud even more consumers . If you're in an MLM, you will learn how to operate your business "legally" and avoid getting scammed and inadvertently scamming others you care about.Don't miss it.
Category: Financial group