web analytics
September 20, 2014 / 25 Elul, 5774
At a Glance

Posts Tagged ‘finance’

How to Avoid Being the Next Ponzi Scheme Victim

Tuesday, September 11th, 2012

One of the main headlines in world financial news this August has been the fate of ZeekRewards.com, an online company that offered investors the chance to get rich quick. Interestingly enough, I heard about ZeekRewards before this company hit the headlines, when one of its salespeople contacted me and asked me to represent them. The very pushy salesman nagged me to set up a meeting, but the more he pushed me, the more uneasy I felt. So I decided to follow my mother’s adage of, “If it sounds too good to be true, it probably is,” and I didn’t meet him.

Reading the headlines, I’m very relieved with my decision. ZeekRewards offered promises of returns such as 1.5% of the investment at the end of each day and shares of 50% of the daily profits. Wouldn’t everyone want that kind of deal? However, this August, the Securities and Exchange Commission (SEC) filed an emergency action in a North Carolina federal court because this investment project was yet another Ponzi scheme.

The owners of ZeekRewards must have realized that many of these potential investors were going to ask questions. So, in a bid to protect themselves they added a clause for new users stating that they were not purchasing stock or any kind of “investment or equity,” and they even labeled the whole thing as an “e-commerce subscription.” The SEC saw through their ruse and said that this was not the case and in fact the company was offering its subscribers false securities. However, the average investor did not have the knowledge to understand what they were getting into, and the abovementioned clause probably sounded fair enough.

As people kept subscribing and playing the company’s game, investing and reinvesting, the company’s cash outflows began to exceed its total revenue, leading to a collapse and many unhappy subscribers who were left with nothing.

This time, there are more than 1 million victims of the scheme, making this the largest such bankruptcy case, with around $600 million at stake.

Interestingly, many observant Jews, both in Israel and America, have fallen prey to this scheme. It’s not the first time that Jews have been hit hard by Ponzi schemes (think Madoff).

This raises the question of why Ponzi schemes such as ZeekRewards are tempting to the religious Jewish community. One possible answer is that many religious Jews have large families and in this economic climate finances may be tight. Offer a person who is trying to find legitimate ways to support his family a way to make some extra money, and it’s tempting to find out more.

Sadly, as stated above, ZeekRewards is not a one-off story. Apart from desperation to make more money, another possible reason people fall for these schemes is that the scammers may have gotten smarter.

However, there are three basic measures that you could follow to protect yourself from falling victim in a financial scheme:

1. Remember my mother’s rule: “If it sounds too good to be true, it probably is.” ZeekRewards offered high gains for pressing a few buttons and looking at some ads. This is the first sign of something suspicious. When something sounds too good to be true, ask yourself, “What’s the catch?”

2. Do your research. One potential investor who decided against investing with ZeekRewards said that when he heard about it, he did his homework. He discovered that the company’s securities offerings were not registered with the SEC as required by U.S. federal law. Recognized authorities monitor investments for a reason; their absence speaks volumes.

3. Don’t feel pressured. If the company/salesman/friend keeps nagging you, saying that the investment opportunity will be gone if you don’t “buy now,” it may be wise to let the opportunity pass.

While there are no guarantees in the world of finance, taking these three steps will provide a basic level of protection against becoming a victim of the next Ponzi scheme that rears its ugly head.

If you are interested in hearing more about the biggest investment fraud in history, watch this TV interview that I did on the subject of Bernie Madoff. Although this was four years ago, the points remain the same. If anything, there are more frauds out there and we need to be more careful than ever. So be wary and tread with caution.

Transferring Wealth with Stocks, Bonds, and Bicycles

Friday, September 7th, 2012

Wealth transfer is a hot topic in financial planning. Thinking about how to pass funds from one generation to the next can be emotionally difficult. Perhaps the older generation doesn’t approve of the way the younger spends the money, or the younger generation isn’t involved in the family business. Furthermore, tax and legal issues can complicate matters.

While estate and inheritance planning can be complex, other wealth can be transferred more easily: the wealth of knowledge. My grandmother successfully passed a financial education to my mother, who transferred it to me, as I am a proud third-generation licensed broker. My maternal grandmother Miriam Rosofsky struggled against social norms to enter the work world. But eventually she had the distinction of being one of the first women to hold a U.S. Securities license. She started as a secretary in a brokerage firm, but then began picking up her own book of clients. My mother Rhoda Goldstein was an associate vice-president in Dean Witter. Dinner-time conversation around my childhood table alternated between medical issues (my father was a surgeon) and economic discussions. I saw how both my parents helped people gain and maintain their physical and financial health. It was therefore only natural for me to begin my financial career partnering with my mother on Wall Street.

After I made aliya, I founded Profile Investment Services, Ltd. with the aim of helping people living in Israel create financial plans and maintain U.S. brokerage accounts. I try to follow in my mother and grandmother’s footsteps in transferring the wealth of financial knowledge to my own children. Even though none have announced their desire to be financial planners (but my wife recently became a licensed U.S. broker), they do check stock prices regularly.

We frequently discuss fiscal responsibility, budgeting, and other economic topics at our dinner table.  Some of the kids are reading books on behavioral finance, and others are reading books about loyalty, fidelity, and trust. My mother, keen to pick up on children’s natural curiosity about money and the way the “grown up” world works, recently came out with a book geared for young adults about how the stock and bond markets work, and how an entrepreneur can raise the funds necessary to fulfill his dream. If you’re interested in sharing this information with your children and transferring the wealth of financial knowledge to them, visit my website to get her new book Stocks, Bonds, and Bicycles. Let me know if you recognize any of the characters in the story.

Tishrei: A Time to Examine Your Deeds and Your Portfolio

Tuesday, September 4th, 2012

What did you do when you built your portfolio? Did you invest the money and then simply walk away? Did you then expect to take another look in ten years’ time and find that you had miraculously become rich?

The financial world, like many other things in life, is always subject to change. Markets go up, and markets go down. What if there is a war in your part of the world, or a huge banking crisis? The financial markets are affected by so many outside factors, a lot of which are not necessarily as dramatic as the above two examples but still have their ramifications upon investments. For this reason, it is always a good idea to take a periodic check of your portfolio to see if the level of risk is still appropriate and if you need to readjust your investments in favor of something that would be better for your present circumstances.

This fiscal check could be compared with the annual reevaluation that Jews are supposed to make at this time of the year. The months of Elul and Tishrei are a time to examine your deeds. You look at what you have done over the past year and where you are going. Are the decisions that you made in the past for yourself and your family still right for you, given the circumstances in your lives that may have changed during the year? How have various challenges that you may have undergone affected the way that you live your life? When you look at the future, what do you see? Although you cannot predict what will happen, there are certain things that you may need to keep in mind and prepare for. Are you prepared for these events?

Spiritual accounting is similar to the financial accounting. In order to be an effective investor, it’s a good idea to sit down once a year with your financial adviser and ask:

- What has happened over the past year that might have changed the balance in your portfolio? – Which of your investments have become more or less risky as a result of market performance? (Learn more about assessing whether high or low risk is good for you.)

- What are your goals for this year, and do you have the means to accomplish them?

- Do you need to change anything in order to improve your financial situation? And if so, exactly what?

- What are the pros and cons of any possible financial move that you may be considering, in terms of hidden costs and taxes, as well as potential profits?

With best wishes in starting the New Year with renewed spiritual strength…and a reevaluated, stronger portfolio.

Only 5,000 Showed Up, One Caped

Sunday, August 5th, 2012

A mass rally that was supposed to combine Social justice activists with the ‘Suckers Camp’ proved once again that there’s such a thing as too many rallies. Last night the Tel Aviv square looked very sparsely populated, despite organizers’ promises/hopes.

But whether or not this spells the end of this wave of rallies – the prime minister, his finance minister and the Israel bank governor made a compelling case for budget cuts, fuel, cigarettes and beer taxes, and imposing an extra point on the already high VAT – it’s clear that someone somewhere in Tel Aviv last night managed to turn on the bat signal.

A lot of good it did them…

Despite Fervent Objections by All Seven ‘Green Line’ Universities, Ariel U. Becomes a Reality

Wednesday, July 18th, 2012

Samaria will have its first full university, pending the go-ahead of the Israeli military.

The Ariel University Center on Tuesday was recognized as a full university by the Judea and Samaria Council for Higher Education, which handles educational concerns in the “disputed territories.” The center, which has more than 10,000 students, Jewish and Arab, would be called Ariel University.

The 11-2 vote came despite a vehement recommendation against approval by the planning and budget committee of Israel’s Council for Higher Education, as well as opposition from the country’s other seven universities, and from public figures, all of whom objected to upgrading a college which had passed all the prerequisites for the boost, but was still unable to conceal the damning fact that it was located in the “West Bank.”

Last month, in a letter to Netanyahu, the presidents of Israel’s seven universities said that an eighth university would deal a “fatal blow to the higher education system in general, and the universities in particular.”

On Sunday, Finance Minister Yuval Steinitz announced that his ministry would earmark extra funds for the Ariel University Center, so that it would not cut into the funding of Israel’s other universities. Steinitz said he will ask the government to grant an allocation of some $5 million to $7.5 million for the next two fiscal years, with plans to increase the sum in future years.

That’s an approximately $4 million a year fatal blow.

Professor Daniel Zajfman, head of the Weizmann Institute of Science, said he would cancel all academic and professional cooperation with Ariel U.

Hebrew University President Menahem Ben-Sasson was concerned about gentile reaction to the move, specifically Norwegians and Swedes, warning: “We are putting the next Nobel Prize in danger.”

MK Einat Wilf, head of the Knesset Education Committee, said it was still all about the money: “If the Finance Minister and the Education Ministry have tens of millions of extra shekels for higher education, they should have been used to assist the existing universities, which are recovering from a decade of tough budget cuts.”

Again, that’s approximately $4 million a year.

For comparison, as of 2010, the Hebrew University deficit was estimated at $2.5 billion.

And the Tel Aviv University salaries and pensions alone have reached $165 million a year.

No doubt, depriving the fledgling Ariel of $4 million a year would go a long way to balance those hemorrhaging deficits.

Of course, the report on the center’s progress that was submitted to the committee of Israel’s academic establishment praises Ariel’s accomplishments and left no doubt as to its ability to take its rightful place as a major academic institution.

The final authorization for making the Ariel center a university will be made by the IDF central commander in the West Bank, Maj.-Gen. Nitzan Alon. At this point, Alon is expected to back up the Judea and Samaria council’s decision.

The Judea and Samaria council was established in 1997 after the Council for Higher Education refused to discuss academic issues concerning the “West Bank.”

In 2007, the Ariel academic center was granted temporary recognition as a so-called university center, and its status was to be reexamined within five years. The city of Ariel, with a population of about 20,000, is located southwest of the biblical city of Shchem, where the patriarch Jacob was hoping to settle down and study some Torah, when unexpected thing started to happen.

Like it or not, Jacob’s dream is becoming a reality now.

JTA content was used in this report.

Alex’s Blog Round-up

Wednesday, July 4th, 2012

 

Where’s the Line Between Tznius (Modest) and Sexy?

In this post, Jew in the City responds to questions about dressing modestly in a positive way.  Coming from a secular background, I see people make judgments about orthodox Jews all the time, sometimes even just based on their appearance.  While I don’t think every woman should dress so modest that they’re Tznius, I do think that modesty could be practiced a little better among young adolescent women.  Or a lot better.  Portraying modesty in a way that is approachable and still attractive can make it more connective.  Clothes are meant to cover, not expose.  That being said, dressing in a modest way can take away the distraction in the way of discovering who that person is on the inside.

 

My Frizzy Curly Jewish Hair

Reading Talia Levin’s story is comical, true, and hits home.  One night I was walking down the boardwalk on the beach with some friends when one of the shopkeepers asked me if I was Jewish.  I asked him why he was asking that and without words, he touched the bridge of his nose.  I was stunned.  Yes, maybe I had a big Jewish nose, but are you serious?  Sometimes I am amazed by the anti-Semitism that still exists, being that I’m surrounded by Jews a lot of the time.  Regardless, I certainly am proud of my own Jew-fro, even if it does frizz up on those rainier days.

 

Stuff Jewish Girls Like

Stuff Jewish Girls Like focused her most recent post on a DIY (do it yourself) project that any J-Girl could tackle on a weekend.  My friends and I are looking for fun new projects all the time.  A couple of them are becoming really talented jewelry makers actually.  I just question why the title of the blog itself is ‘Stuff Jewish Girls Like’. Non-Jews like jewelry too, no?

 

Jewish Women’s Archive: Jewesses with Attitude

This blog is one any young Jew should keep bookmarked.  It’s part of a national nonprofit whose mission is to uncover, chronicle, and transmit the rich legacy of North American Jewish women and their contributions to the world.  Amen to that. This week, one blogger posted about Gilda Radner and the legacy she left.  She would have been 66 this week, but spent the many years she was here devoted to raising awareness about hereditary cancers.  Ashkenazi women are more likely to develop breast cancer than others, at a rate of ten to 40 percent.  Honoring Gilda Radner by getting the word out about breast cancer and its daunting contraction rate is definitely a message worthy of a retweet.

 

Jewish Boy Problems

If you’re on Twitter these days, you’ve probably seen the hashtag, #insertstereotypehere followed by problems.  Whether it’s #firstworldproblems, or #citygirlproblems, each one is meant to poke fun at some of the ridiculous things people say in those lifestyles.  They’re stereotypical yes, but have taken over the Twitterverse.  One of my personal favorites is Jewish Boy Problems.  If you’re unfamiliar with this character, you can get a better idea from the bio listed: “I have brown eyes and hair. My legs are uncomfortably hairy. My dream is to crack 5’8. I think my Dad works in finance. My Mom loves to spend his money.”  Growing up in a Jewish town in northern New Jersey, this boy is one I encountered frequently.  The Twitter handle has turned into a blog, in which sentences or phrases are posted that typical ‘Long Island-style’ Jewish boys might say.  Some gems from this week:

  1.  #overheard at my office: “Which Melissa Schwartz are you talking about? The one I know went to Mich, not UPenn.”
  2. According to my father, no food expires. Not even produce.#JewishBoyProblems
  3. “My grandparents are letting me stay in their Upper East Side apartment while they’re in Boca for the season.” #Overheard

Happy Stalking!

 

 

 

 

 

 

Planned Polish Jewish History Museum to Receive $7 Million Grant

Sunday, July 1st, 2012

The Museum of the History of Polish Jews, which is set to open next year, will receive a $7 million grant from two Jewish philanthropic foundations.

The gift from the Koret and Taub Foundations will finance eight galleries that will take visitors through 1,000 years of Jewish history in Poland. The exhibits will include a scale replica of a 17th century synagogue roof’s interior and will feature original artifacts from the Polish Jewish community, as well as multimedia.

Work on the museum began in 2005. It is a joint project of the Association of the Jewish Historical Institute of Poland, the City of Warsaw and the Polish Ministry of Culture.

“Poland is where my parents and grandparents were born,” said Tad Taube, president of the Koret Foundation and chairman of the Taube Foundation, in the press release. “This is their story. Poland is where I was born. This also is my story.”

Printed from: http://www.jewishpress.com/news/breaking-news/planned-polish-jewish-history-museum-to-receive-7-million-grant/2012/07/01/

Scan this QR code to visit this page online: