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The Con Men

The Con Men

A history of financial fraud and the lessons you can learn

Leo Gough

Aug 2013, Paperback, 224 pages
ISBN13: 9780273751342
ISBN10: 0273751344
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Financial fraud, whether large or small is a persistent feature of the financial markets. If you scratch the surface of the investment world you’ll find a continuous stream of major financial scandals which are almost unbelievable in the sheer scale of their subterfuge.

The Con Men shines a spotlight on some of these gargantuan frauds from the last 25 years. It questions how these men did it, why they did it, how there were able to get away with it, proposes strategies and tactics so that the reader can avoid being swindled.


About the author


Part One A brief but efficient history of trickery

Chapter 1 The horror stories

Bernie Madoff

Allen Stanford

Could you have spotted a problem?

Lessons from the past

If you can’t trust the analysts and the auditors, who can you trust?

Chapter 2 Our touching need for confidence

Insider trading

Ivan Boesky and Dennis Levine

Robert Vesco

Plus ça change. . .

Chapter 3 Shiny new inventions and old tricks

Ponzi and ‘Pump and Dump’ schemes

The SEC and Bernard Madoff

Further SEC investigations

Some frauds just never go away

Part Two Let’s go to work: the confidence men in action

Chapter 4 Sharks or maniacs?

Are some financial fraudsters psychopaths?

Routine activity theory

Nigerian scams – a different type of fraudster altogether?

The problem with plausibility

Chapter 5 Yielding to temptation: the Allen Stanford story

Offshore jurisdictions

Good old boys

Making sense of Stanford

Chapter 6 Shamanagement: financial wizardry to create paper profits

The Olympus scandal

The man who became the ‘Man from Del Monte’

Investors versus business shamans

Part Three Why we get the swindlers we deserve

Chapter 7 Some deadly sins of investment: trusting false prophets,

investing for the Apocalypse and the money illusion

Selling the sizzle, not the steak

Gold bugs: waiting for Armageddon

The money illusion

You can fool some of the people all of the time …

Chapter 8 Moral hazard in the system

The LIBOR scandal

The swindling of Jefferson County, Alabama

Surviving the banks

Chapter 9 Due negligence: failing to do the analysis

Harry Markopolos and Bernie Madoff

A word on funds and funds of funds

Due diligence always matters

Part Four How to avoid being swindled

Chapter 10 Funds are not all the same!

The Bayou hedge fund fraud

Avoiding hedge fund fraud

Chapter 11 All the books are cooked: the trouble with company accounts

Legal differences

Corporate governance from the investor’s point of view

Company accounts

Crazy Eddie


Investors and accounts

Chapter 12 Safer strategies

The first line of defence against fraud

Lower your expectations

Asset allocation

Staying sane in the investment jungle


Further reading


Leo Gough was the editor of two investment newsletters during the 1990’s, ‘The Zurich Club’ and ‘Taipan’ for Fleet Street Publications. Since 1997 he has spent much of his time in the Asia/Pacific region, working with banks, such as Citibank, and consultancy firms, such as AT Kearney. Currently Leo is working in management consultancy in the Middle East. He is the author of more than 20 books on personal finance and investment.

Leo Gough’s book ‘The Con Men’ is something that has needed to be written for a very long time. It gives a potted history of the major frauds that have been perpetrated on the investing public, who have lost masses of their hard earned capital, and who have no redress for the theft of their money.

Charles Vintcent, author of Investing for Recovery (FT Publishing, 2010)