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Posted 24 Feb 2001   For week ended September 03, 2000
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Sent on Mormon-News: 08Sep00

Summarized by Melisa Davis

LDS Investment Guru Under Investigation

SEATTLE, WASHINGTON -- Former cabbie Wade Cook created a large financial-seminar business, sharing strategies of triple-digit annual returns on investments. Now the Federal Trade Commission and authorities from 13 states are nearing completion of settlement pacts with the Wade Cook Financial Corporation because of numerous customer complaints.

Cook, owner of LDS book publisher Aspen Books and a member of the Church of Jesus Christ of Latter-day Saints, gave two-day seminars in hotels about his "meter-drop" investment philosophy. From his experience driving cabs, he learned that because customers paid $2 just to get into his taxi, short trips were more lucrative than long ones. His strategy on investing was the same -- quick buy-and-sell trading would bring bigger returns, and he promised investors that they could earn more than 20 percent in a month. In a Washington State investigation, returns on his accounts between 1995 and 1998 were actually between 3.3 percent and negative 5.3 percent.

These seminars netted Cook $118.2 million in revenues in 1998. The proposed settlement would require that he reimburse to the tens of thousands of participants up to $5,695 and pay $400,000 to the states to cover investigation costs. Although the settlement restricts Cook's promotions -- he has to show three years of returns using his investment advice -- Cook is allowed to continue selling his seminars, books, audio and video tapes and infomercials.

It is not know what effect, if any, the settlements will have on Aspen Books.


Self-Annointed Investment Expert Investigated
Wall Street Journal 2Sep00 B2
By Jeff D. Opdyke: Wall Street Journal


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