Disclaimer: For legal purposes, this is not financial advice.
Earlier today, both the Pace Chronicle and Investment Club hosted an event called “Guide to Proofreading: Financial Advice.” James Steigerwald and Evan Mahanna kicked things off with a presentation on why financial proofreading is so important. Here is a rundown of the speakers if you missed them:
Dan Gabel works for the USPIS’s federal department. He discussed various issues, such as mail and revenue fraud. He said, “If they’re falling behind, sometimes there’s a pressure to commit fraud.” He also said it was important to read financial statements and notes, looking back over the years.
Capital fraud and investing in small companies are where lots of people can lose their savings; their money is not secure in those two cases. Even if they’re investing in friends and family, Gabel weighs in heavy on being skeptical. Something to note is legitimacy: Are the photos real? Are the endorsements real? It is not always easy to tell. He also showed some bank statements, a real one and a fake one. The fake one has many inconsistencies in dates and was not proofread.
He shared lots of great real-life examples of this, one of a man who managed a hedge fund and created a partnership with family. He lied about investing in the hedge fund, yet it was still growing. He turned himself in, but it’s important again to be keen on the details.
Gabel warned the group about mail theft, stating that there are 2,222 arrests per year regarding mail theft. Violent crimes are also serious. When employees get robbed, keys can be stolen, and it can cause a lot of destruction to not only the postal worker but also the community. Cybercrime is another big issue, where hacking and fake emails are sent to victims to capture control of their financial records and money. To invest in treasury might have the least risks, but they have the least returns.
The next speaker was Robert Beranger, a Pace Alumnus, who investigates fraud and does a lot of work in anti-money laundering. Private equity types are important to note as something to focus on when it comes to stocks. It’s important to think about risks, especially with the new tariffs, when it comes to investing in stocks. You could double down or pull out, but it’s almost like a gamble. These tariffs are not predictable, you can see if it reaches a certain level, or even what people online are saying. Timing the market is also extremely difficult, he mentioned how he went from $1,000,000 to $800,000 in just a few days.
Stocks go up and down by buying and selling. Heavy demands make stock prices go up, and vice versa. He spoke about someone driving the market by buying from their investments. This would be called a false demand, when stocks are bought in house, and it’s something to be careful of. You must also look into the business and its footprints. Another is to look into the people involved, make sure to search the people working in this company. Finally, it’s important to see their earnings; if they’re not listing them, this could be a big red flag.