First PPD Gets SEC'd, Then it Gets FTC'd. It Seems to be a Bad Year for Ponzi Schemes

By: Reggie Middleton | Fri, Nov 20, 2009
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When I first came out with the PPD research (which I released for free as a public service, may I add), many were doubtful as the market was literally manipulated upward. I feel my blog's patrons were confusing the alleged "scam's" fundamental viability over time (and ability to avoid regulatory discipline) with the overall movement of the market. As you can see below, things are not going well for this company. If one had faith in the research and rolled puts and protected shorts over, one should start seeing some decent gains. If I am right and this market is simply in a bubblicious bear market rally, any aggressive action by the SEC will drive this beta driven stock into the ground, making what you see today and last month look like an actual rally. Hey, it couldn't have happened to a better company.

Prepaid Legal press release:

Pre-Paid Legal Services Announces FTC Developments

ADA, Okla., Nov. 19 /PRNewswire-FirstCall/ -- Pre-Paid Legal Services, Inc. announced that on November 18, 2009, we received a proposed draft complaint from the Federal Trade Commission ("FTC") seeking permanent injunctive relief (there goes that revenue stream), disgorgement of proceeds (that will hurt, a lot) and other relief, including costs, relating to our Identity Theft Shield and Affirmative Defense Response System ("ADRS") Program. The proposed draft complaint alleges our ADRS program and related materials violate Section 5(a) of the FTC Act regarding asserted misleading representations, express or implied. The proposed draft complaint also names Harland Stonecipher, our Chief Executive Officer, and Mark Brown, our Chief Marketing Officer, as defendants (That is something. The officers of the company are named personally, as well as the entity itself). We previously received a Civil Investigative Demand from the FTC on March 23, 2007 on the ADRS program. We have made voluntary revisions to the marketing materials originally provided to the FTC in 2007 and 2009. The FTC may decide to commence federal court proceedings with this proposed draft complaint. The ultimate outcome of the matter is not determinable but we will vigorously defend our interests in this matter.

Let's see what comes of this. If the SEC hits them, I would consider this a penny stock.

Previous opinions, and more than a few "I told 'ya so"'s' on the Flim Flam Scam:

  1. Flim, Flam, Scam: Would a PPD Ponzi and Pyramid scheme cause your wealth to Scram? Wednesday, 18 March 2009
  2. Reggie Middleton's Continued Public Service Announcement on the Flim Flam Scam Friday, 03 April 2009
  3. A Demonstration of How PPD Management is Destroying the Company Tuesday, 07 April 2009
  4. Additional Commentary on PPD Tuesday, 07 April 2009
  5. The Flim Flam Scam gets SEC'd - I'm not going to say I told you so, again! Tuesday, 06 October 2009



Reggie Middleton

Author: Reggie Middleton

Reggie Middleton

Reggie Middleton

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