PipStop

Amidst all that was going on last week, I missed this, and I think many others did too, as I didn't see any other bloggers comment on it. Thanks to Robert who forwarded me this news today.

Last Thursday, Phillip Bennett received 16 years in prison for orchestrating the fraud that bilked investors of over $2.4 billion.

With our previous company I was around when the whole Refco situation blew up and it was not pretty. There were many blind traders not really realizing where they were putting their money.

The regulations surrounding brokers has improved, but in the United States at least none of investor funds are insured, while in Canada with the Canadian Investor Protection Fund funds can be eligible to be protected up to $1,000,000.

Too many times traders are focused on the wrong things. I've spoken with traders who want to find the best off-shore broker to do business with. The assumption is that one can then better shield trading profits from the government.

There are other Phillip Bennett's out there. It's just a matter of if you will be caught in the web of fraud or not. Just as in trading, there are no guarantees, but you can minimize your exposure to risk.