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Re: sentiment_stocks post# 46784

Tuesday, 12/08/2015 9:46:48 PM

Tuesday, December 08, 2015 9:46:48 PM

Post# of 708087
Another way to think about your question Senti.

Sometimes a con artist will both cause the problem and already have the solution. Let's look at it logically.

Let's say you have Large Investor A. He likes Biotech. He also employs a consulting firm B to help vet and oversee companies.

Large Investor A thinks biotech C looks very promising. He has his science/financial team D evaluate them, and they say, yes, it does look promising and undervalued.

He also asks consulting firm B to help vet, but the consulting team has reservations. "Well, if anything comes up, we should do a complete internal/external vetting."

Large Investor A makes significant investments in biotech C. Unbeknownst to Large investor A, consulting firm B uses media contacts to hit the biotech with destructive analysis, and this started to occur before large investor A even put money down on Biotech C. Large investor A invested anyway because he's used to that sort of thing.

Next, after large investor A is deeply financially committed with biotech C, and it appears the science still stands up, consulting firm B secretly writes/outsources a 69 page anonymous attack on biotech C.
Next, they go to large investor A, and state, we can't ignore this, we must fully internally and externally vet them. They suggest another conflicted consulting firm, a conflicted and unsuited board member, and themselves (who are very conflicted), in fact their partner is a director for a company being sued by biotech C's close manufacturer.

Large investor A trusts consulting firm B, and makes his next financing contingent on biotech C agreeing to consulting firm B's demands.

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Such a scenario would make it seem fairly easy for consulting firm B to dupe a very large billionaire investor who must delegate and trust his subordinates and consultants.

Respect Risk. Conduct Your Own Due Diligence. Manage your assets wisely. Diversify.

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