People with money do the darnedest things. Here's some recent evidence.
• The Securities and Exchange Commission reports that about 150 U.S. investors collectively contributed $300,000 or more to a fraudulent pyramid scheme that promised them returns of 2 to 3 percent per week.
According to the agency, the hefty payouts were touted by Mutual Wealth, which said the outsized returns were possible because it used an extra special high-frequency trading strategy that invested in securities for no longer than a few minutes. Investors were promised commissions and referral fees for recruiting other suckers. Efforts to make Mutual Wealth's website more convincing included posting a list of what the SEC terms "make-believe executives."
"Mutual Wealth used Facebook and Twitter as well as a team of recruiters to spread a steady stream of lies that tricked investors out of their money," Gerald Hodgkins, with the SEC's enforcement division, said in a statement.
Regulators got a court order freezing accounts holding the investors' money and deactivating Mutual Wealth's website. The investigation continues.
• Nearly 70 percent of parents are very or extremely concerned about setting a good financial example for their children, according to T. Rowe Price's Parents, Kids & Money survey. But that doesn't stop 30 percent of them from occasionally "borrowing" from their kids' piggy banks, the Baltimore investment firm discovered. Another finding: While 49 percent of the children had tablets and 55 percent had computers, only 45 percent of them had bank accounts.
• Thousands of taxpayers have lost more than $1 million after fraudsters posing as IRS officials called them and demanded payment for unpaid taxes. In some cases, the callers knew the last four digits of the victim's Social Security number and were able to make the victim's phone display caller ID information that made it look like the IRS was actually calling. Some sent bogus emails that appeared to be from the IRS to support their scheme.
Victims are told they owe taxes and must pay them with a wire transfer or pre-paid debit card. Those who refuse to pay are told they may be arrested or lose their driver's license. Immigrants are told they could be deported.
"If someone unexpectedly calls claiming to be from the IRS and uses threatening language if you don't pay immediately, that is a sign that it really isn't the IRS calling," J. Russell George, the U.S. Treasury Department inspector general in charge of tax administration, said in the press release.
The IRS first warned about the scam in November. This month, Mr. George said his office has received more than 20,000 reports from nearly every state, calling it "the largest scam of its kind that we have ever seen." The IRS usually notifies tax delinquents by mail first and won't ask for a credit card number or payment by pre-paid debit card or wire transfer, he said.
People who receive calls and either owe taxes or think they owe them should hang up and call the IRS at 1-800-829-1040. Those who don't owe them should report the incident to the IRS at 1-800-366-4484.
• TIAA-CREF reports that 15 percent of Americans spent two hours or more planning an investment in an Individual Retirement Account. While that may sound like a substantial commitment in an age of shrinking attention spans, that was not the point TIAA-CREF was trying to make.
The company, which manages about $564 billion for college employees and other individuals, was trying to demonstrate that larger percentages of people spend just as much time on less pressing concerns. Among those who responded to its survey, 25 percent admitted to spending two hours or more selecting a restaurant for a special occasion. Another 21 percent said they devoted that much time to picking out a flat-screen TV.
TIAA-CREF found that only 17 percent contribute to an IRA, down from 22 percent in 2012.
• Not coming to a theater near you: "The Smuggler," starring Donald Sutherland and/or Jean-Claude Van Damme.
Seems like the SEC shut down "production" even though more than 60 investors had chipped in $1.8 million to fund the feature film. What they did not know was that Mr. Sutherland or Mr. Van Damme were never asked to lend their talents to the project and that the promoters spent most of the $1.8 million on themselves, according to SEC officials. What's left is not enough to produce a public service announcement, regulators said.
However, three individuals targeted by the U.S. attorney for their part in the scheme have landed leading roles in criminal proceedings. Turns out one of them was barred for life from the brokerage industry as the result of a 2009 SEC enforcement action. That's something that unwitting investors could have learned through a simple search of the agency's website.
• Fewer than half (42 percent) of those surveyed by Pentegra Retirement Services who are enrolled in a 401(k) plan understand that they do not pay income taxes on their contributions. Pentegra, which manages more than $8 billion in 3,500 retirement plans, also learned that 37 percent of 401(k) plan participants say they're not really worried about how their money is invested as long as it's there when they want it.
Good luck with that.
Len Boselovic: firstname.lastname@example.org or 412-263-1941.