|
Summarized by Kent Larsen
Financial Guru Wade Cook Settles Claims
SEATTLE, WASHINGTON -- Two companies owned by Wade Cook, the former
cab driver turned millionaire who gives stock investing seminars,
have settled claims that they deceived customers with the Federal
Trade Commission and with the state of Washington. Under the
agreement, Wade Cook Financial Corp. and Wade Cook Seminars, Inc.
will give refunds to customers that lost money following Cooks
advice. Investigators say Cook's claims of exceptional investment
results were deceptive.
Cook is not personally accused in the settlements, and neither he nor
his companies admitted any wrongdoing. However, the companies did
agree to change their business practices and Cook agreed to use his
personal fortune to pay refunds, if necessary.
Cook's companies have been under investigation since 1995.
Investigators say that he misled investors, leading them to believe
he had used the advice he gives in his seminars to get rich when in
fact he gained most of his wealth through the seminars themselves.
They also say that the companies manipulated the investment results
given to subscribers to their on-line service, making the company's
investment results appear better than they actually were.
Investigators estimate that as many as 50,000 people paid $3,000 to
$5,000 for Cook's "Wall Street Workshop" seminars. They estimate that
refunds could total as much as $250 million.
Cook is a former cab driver who has recently tried to broaden his
activities. An LDS Church member, he recently purchased the LDS book
publisher Aspen Books and associated companies. Aspen's distribution
company, Origin Books, now distributes Cook's investment books. Since
Cook's personal fortune is on the line for the refunds, it is
theoretically possible that the refunds could have an effect on the
health of his LDS publishing operations.
The settlement agreement with Washington State was filed on Thursday,
October 5th, as was the agreement with the Federal Trade Commission.
Thirteen other states are participating in the settlement with Cook's
companies.
Source:
State and Feds Settle Case Against Wade Cook Financial
Excite News (Business Wire) 5Oct00 B2
|
