Customer Reviews

From Hard Knocks to Hot Stocks: How I Made a Fortune Through Smart Investing and How You Can Too

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According to published articles, D. H. Blair & Co. was a training ground for the "pump and dump.

In this strategy, prices for an IPO are artificially "pumped" by a group of brokers who control the shares by creating demand selling to each others' customers in a closed artificial market. Once the price increased, the insiders dump while the unsuspecting retail clients are aggressively encouraged to hold their shares and not sell. After the insiders have dumped their shares, the cold calling stops and because there is no longer support for the price, the shares free-fall as the brokers move onto the next issue.

On March 7, 2002, in an action before the Supreme Court of the State of New York, County of New York, Blair pled guilty and was convicted of three counts of violating the Martin Act-the New York state securities law
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Manhattan District Attorney Robert M. Morgenthau announced today the stock fraud indictment of securities firm D.H. BLAIR & CO., INC., and fifteen of its officers and employees for enterprise corruption. Included among those indicted are KENTON WOOD, the Chairman of the firm; ALAN STAHLER and KALMAN RENOV, the firm's Vice Chairmen; VITO CAPOTORTO, the head trader of the firm; ALFRED PALAGONIA, the top-producing broker for the firm; and ten other Blair brokers. In addition, three other former D.H. Blair brokers have pleaded guilty to felony charges arising from this investigation.

The sixteen defendants have all been indicted for Enterprise Corruption, Scheme to Defraud in the First Degree, and securities fraud in violation of the New York State General Business Law. The Grand Jury alleged additional pattern acts, including perjury and violation of New York's antitrust law. Various defendants were also indicted for Grand Larceny in the Third Degree and Falsifying Business Records in the First Degree. The Enterprise Corruption charge, which is punishable by up to twenty-five years' imprisonment, alleges that managers and stockbrokers at D.H. Blair ran the business as a criminal enterprise.

The 173-count indictment charges that the defendants participated in the "D.H. Blair Criminal Enterprise" from 1989 through 1998, and that the members of the scheme defrauded numerous people - including their own customers, other investors, other brokerage firms, and securities regulators - in order to realize massive illicit profits. Members of the D.H. Blair Criminal Enterprise conspired to commit, and did commit, a variety of crimes to advance their common criminal purpose. They manipulated stock prices -- including securities being offered in initial public offerings ("IPOs") -- for the benefit of the firm, certain favored customers, stockbrokers, and other people associated with D.H. Blair. They engaged in a wide range of illegal and high-pressure sales practices to generate excessive commissions and to facilitate the manipulation of stock prices. In addition, they illegally colluded with other securities firms to manipulate stock prices. They fraudulently increased commissions by selling securities to customers at far more than prevailing market prices. They increased the size of the firm's customer base by trafficking in client information stolen from other firms and by opening accounts for customers whom they knew were not suitable for the kind of high-risk securities marketed by D.H. Blair.

More than 50,000 customers invested with D.H. Blair & Co., Inc. during the period of the existence of the D.H. Blair Criminal Enterprise. Many suffered severe economic losses as a result of the criminal conduct of the enterprise. For example, a 56 year-old disabled man from Colorado lost approximately $150,000 from a disability settlement upon which he relied to pay for medicine and other living expenses; he was given false price predictions and so-called "inside" information which did not pan out. Another investor, a 63 year-old disabled racetrack worker living on a fixed income in Manhattan, lost $35,000 of a $38,000 IRA due to unauthorized purchases in her account and refusals to sell. A tugboat pilot from Brooklyn lost the $45,000 she had saved to buy a house; while she was at sea, unauthorized trades were made in her account and when she complained she was falsely assured that she would be the recipient of windfall future profits. Another Blair customer, a 70 year-old Florida resident who had retired as a trumpet player for the New York Philharmonic, lost approximately $250,000 from his IRA and trust accounts due to false price guarantees and high pressure tactics designed to prevent him from selling.

D.H. Blair made large profits by fraudulently distributing and manipulating the securities of companies that had been brought public by its associated investment banking firm. In 1996, for example, the brokerage firm made gross profits of over $85 million from such over-the-counter securities trading. The indictment charges that among the IPOs that the D.H. Blair Criminal Enterprise fraudulently sold and manipulated were Amerigon, Inc., Telepad Corp., Premier Laser Systems, Inc., Interactive Flight Technologies, Inc., Sepregen Corp., Food Court Entertainment Network, Inc., Titan Pharmaceuticals, Inc., Digital Video Systems, Inc., Conversion Technologies International, Inc., and Advanced Aerodynamics and Structures, Inc.

In order to commit these crimes and evade detection, members of the D.H. Blair Criminal Enterprise falsified business records, suppressed customer complaints, hid illegal practices, gave false and evasive testimony, and otherwise misled regulators charged with enforcing the laws and rules governing the securities industry, including the United States Securities and Exchange Commission ("SEC") and the National Association of Securities Dealers ("NASD").

This was definitely one of the best books I've ever read! It's a real page turner(I couldn't put it down!) Davis' life story is intriguing and really makes you laugh out loud many times. It simplifies the techniques of how to make big money in the stockmarket. A friend recommended the book with a rave review, saying he read it in one sitting, and described it as "inspirational" and "exciting." The lessons of the stockmarket are woven into the book with humor (most chapters begin with an apropos joke). It makes great reading for both the layman and the savvy investor. The ideas are fresh and exciting, and based on a high school drop-out turned Harvard businessman's years of real life experience and wisdom learned on the streets and on Wall Street. Davis cuts through all the boring terminology and stuffy theory, to give practical, simply stated advice (guidelines) on how to make it happen. Davis is humorous, honest, colorful, enthusiastic, dynamic and generous (in that he seems to genuinely want to share his formula for success). I highly recommend this book to anyone who wants to learn how to invest and win big, or for anyone who just wants to have a good laugh and be inspired by a regular guy who turned his life around through hard work, good values, and the undaunting pursuit of a dream.

I always felt that with hard work and determination I could succeed.After reading morty davis's book I'm sure of it.

I knew from Hard Knocks To Hot Stocks would be an outstanding book because it got rave reviews from Larry King, Donald Trump, Senator Dole, Ace Greenberg, Barry Farber, John Westergaard, and Carl Icahn. I took their recomendation and read it. They were right , It made me laugh and learn simultaneously. It was inspiring.

Larry King's review (on the back cover) said it best, "this is the best book I've ever read on making it big. You're in the hands of a master. Enjoy!"

Morty Davis shares his inspiring rags-to-riches story while outlining an insightful path toward stock market wealth. The book is packed with real-life anecdotes that teach tremendous lessons on business and true success. I devoured the book and loved every minute of it. I can't wait to call my broker and start using the techniques on a portion of my portfolio. The humor and simple strategies make this a book that all will enjoy. I will be sure to include it as a gift idea for many of my friends.

In reading the book I found the first half some what hard to get through. I was looking towards getting the info he was to give on investing. The second half of the book was what I was looking for. If you use his discipline in trading you could make alot of money in the market. I would recommended it just to have a base to use in your stock trading methods.

I know the author personally,he gave me my "shot" on Wall St.when I was 18 years old.There are a lot of "empty suits" that have written books on investing,I promise you Morty is not one of them. If you love facts as I do regarding investments...buy this book it will be of value to you.