Anthony Davian the “mini Madoff”, Twitter and the ever gullible investing public…

Ever heard of one Anthony Davian? No, neither had we until last week. But this 34 year old “fund manager” has been catching publicity for all the wrong reasons in recent weeks…

A bit like our old friend the fraudster “Miss Daytrader” aka Dave Robertson/Warren Needell/The BigSexyCool (who is the seeming friend of Mr Jason Sen of Daytradedreams or whatever it is…), it seems Twitter was his primary tool for enticing in the ever gullible investing public with hopes of gaining big in the stock market (I suppose it beats trying to catch flaming or is it smoking rockets for a few quid a month!!).

Wannabe hedge fund mgr Anthony Davian

Davian created an investment company called Davian Capital Advisors LLC a few years ago that seemed, at face value, to have a veneer of respectability. Within its portfolio of funds were the Rubber City Pure Alpha, Cleveland Precious Metals, and Davian Capital Fund and all appeared to be legitimate. He marketed himself and his own company as a multi-million dollar operation, supposedly dealing with serious amounts of money and displayed what seemed to be an ability to generate the ever elusive “alpha”.

Davian’s real twist and modus operandi however was to use Twitter to great effect. Unlike the usual scammers that ask you to pay money into paypal accounts that are largely untraceable (sound familiar?!), this chap engaged in the well-worn “pump-and-dump” technique in micro-cap stocks. End result? Short term flash cars for Davian, but for his followers – $1.8 million in accumulated losses.

Not content with the simple “pump and dump” operation however, Davian used monies that were deposited by newer clients into his “funds” to pay back older investors whose money had already been used to buy personal perks for himself like a luxury home and an Audi Q7 Prestige – a classic Ponzi.

Inevitably of course, as with all Ponzi schemes, events caught up with the fraudster and the authorities closed in resulting in Davian pleading guilty to charges relating to security fraud, mail fraud, wire fraud, and money laundering.  His whole business was nothing more than a simple Ponzi scheme where those gullible investor’s funds were used, in the words of the prosecutor, as “Davian’s personal piggy bank”.

It is somewhat unfortunate that there are still so many scammers out there, always looking for an opportunity to sell their junky tips that are worth precisely zero, peddling shortcuts to wealth accumulation and prosperity and appealing to the inherent greed in human nature. That so many continue to fall for it perplexes us…

As we have always said here at SBM, if you KNOW how to make money in the markets then you don’t sell it for coppers or tweet about it. You either trade it yourself or you set up a fund management company and go out and create a legitimate record and invite investors to join you. Remember that next time an email drops into your inbox offering you the road to riches for a few quid.