Customer Reviews

How to Smell a Rat: The Five Signs of Financial Fraud

5 star:		(13)
4 star:		(5)
3 star:		(3)
2 star:		(1)
1 star:		(1)

 

 

Fisher offers five signs of potential financial fraud. The good news is that they seem useful, and the book's an easy read; the bad news is that the book could have been shortened to a page. The rules are: 1)Never hire any form of money manager or advisor who takes custody of your assets. That is the #1 biggest, reddest flag. (What about mutual funds - they take custody of your assets?) 2)Returns are consistently great - almost too good to be true. Bad years indicate integrity, says Fisher; schemers don't want complaints or reasons for investors to redeem their money. 3)The investing strategy isn't understandable, "too complicated" for him to describe so you can easily understand. 4)Your advisor promotes benefits like exclusivity - eg. secrecy, lack of advertising or bragging. Or he tries to make it sound difficult to get into - need to know somebody. 5)You didn't do your own due diligence.

I would add another criterion - don't buy anything sold by salesmen on commission. While perusing this book at a store I overhead a securities salesman talking to a friend about the money he was making selling securities, while bragging that his knowledge was limited. Scandalous!

For those reviewers who said this book was "simplistic"-- they were right! This bok is "simple" to UNDERSTAND, that is! Which means you'll read it. And, unlike some of the other dry financial books out there, you'll actually get some useful information that really can prevent you from getting scammed.

Remember those old "Fight Back" shows? This book reads like THAT. It's fast paced, funny, and the author has really tried to make the book easy to digest for the average person. I liked it. The ideas are sound, and I think that the main goal of the book was to warn people how NOT get taken by a fraudster. In this respect, the book succeeds admirably.

Now, a word of caution. If you are a financial professional, you might find the book a bit simplistic. But I doubt the author was writing for CPAs. This book is for everyone else.

There were a few points that I thought the author could have covered a little better, but overall, the book is a fun read, and it's worth the purchase price. Recommended.

Thankfully I've never been duped (knock on wood) out of my hard earned investments and I can only express sympathy to those who have. However, if you asked me to come up with a sure fire way to sniff out individuals with nefarious intentions I could come up with maybe one or two. I believe most people would say the exact same thing. However, Ken Fisher and Lara Hoffmans provide FIVE key traits, which I believe help uncover the entire gamut of possibilities that unscrupulous investment firms design to grift money from honest and hard working investors.

This book is invaluable and straightforward. It was incredibly easy to understand and is written in a way that any everyday investor can understand. This book doesn't try and masquerade as anything other than a deeply honest and telling account of the financial scandals that occurred over the last 2 years.

Anyone looking to avoid being misled should use this book as a manual for interviewing their next money manager. "How to Smell a Rat", could have been titled "Choosing the Right Investment Manager - Things to Ask and Look For In an Advisor".

This book was excellent, to the point, and will be invaluable to me. I am taking it with me next Thursday when I am having a meeting with a possible money manager. I'm opening it a page 36 and asking those questions and checking his answers. Thanks to this book I will not be scammed.

Not only is this another entertaining read, it is important education which all investors should absorb. In today's day and age, you must avoid being naive to the investment industry. Fortunately, Ken is also a well-regarded & ethical wealth manager for high net worth investors like myself, so I don't worry. Thanks Ken for another great read.

This book is a great resource for all investors. I learned an incredible amount about financial fraud and the signs I could potentially be getting scammed. I was actually pleasantly surprised by the quality and number of tips there were on avoiding fraud. Some investors may claim they know it all but Fisher really tells the inside story on what to watch out for and common pitfalls investors fall into when searching for a money manager. An entertaining read and beneficial guide that could really save investors a lot of time and money! I enjoyed it and already bought a copy for my mom too!

I see most of the reviews on Amazon raved about this book. I wasn't as enthusiastic. Some of it was informative, but overall it's pretty basic stuff (e.g., Sign Number 2: Too Good to be True, Usually Is). It's also repetitious. After each chapter is a recap, and the last chapter summarizes everything all over again just in case you didn't get it the first two times. Seemed to me this was just a magazine article disguised as a book.

Not worth the money. Better off to read it in the library. He excuses the SEC's incompentence regarding Madoff's scam, and tries to convince us that Financial Advisors like him are safe and we bring the money over to him. I feel that he is very subtle in his self serving statements, but this could have been an article in Forbes, rather then an entire book. I expected more financial information for Fraud detection, rather then a repleat of the same topic in 5 chapters. Save your money and wait for the movie.

While the most famous book by the author, "The Only Three Questions That Count: Investing by Knowing What Others Don't", is dedicated for investors with background in economics, who make investment decisions by themselves by buying directly stocks, bonds, real estate, businesses and commodities, this book, "How to Smell a Rat: The Five Signs of Financial Fraud" is for those who hire a money manager or financial advisor. The author presents an easy to understand, clear and straightforward toolkit of how to distinguish between a real money manager and a fraudster. The framework laid out in this book is highly practicable.

Another valuable point of this book is that Fisher also includes suggestions for further reading. This is very uncommon for such kinds of books. I would like to give great respect to Fisher for that. The author encourages to increase your financial IQ. Some people rely on SEC and other agencies and get cheated. You can help SEC by not allowing to be cheated. Fishertells you thoughout the book that it is not gambling if you know what you're doing. It is gambling if you're just throwing money into a money manager and praying. The idea in anything is to use your technical knowledge, wisdom and love of investing to cut the odds down, to lower the risk. Of course, there is always risk. It is financial intelligence that improves the odds. Thus, what is risky for one person is less risky to someone else. That is the primary reason why the author encourages the readers to invest more in their financial education than in the stock, real estate or other markets. The smarter you are, the better chance you have of beating the odds.

This is another thoughtful and applicable tome by Mr. Fisher. He clearly details the methods used by crooks to part the foolish and surprisingly not so foolish from their money and outlines steps that individuals should take to avoid being used by a Wall Street Wolf in sheep's clothing. I highly recommend this book as well as "The Only 3 Questions That Count."