An interesting bit of drama played out a few days ago inside the EliteTrader messageboard. After becoming a paid sponsor, Traders International started posting about their star trading teacher Franz Shoar (Faramarz Vahdatshoar).
At TI, Franz, was supposedly trading the spoos live, and pulled in hundreds of thousands of dollars a day on average. For a fee, he was willing to teach anyone by letting them look over his shoulder. As you can imagine, that got a lot of attention. Finally, the man himself came and told everyone that he would be happy to answer any and all questions. That really got things going.
Especially since it had already been revealed that Franz uses a counter-trend strategy and simply doubles down. Some piped in that they knew all the big players in the spoos and Franz, definitely was not one of them. After all, the kind of size that he was throwing around gets a trader noticed.
People started to suspect that it was trading but trading on a simulator and that Franz was flat out lying. It didn’t take too long for the whole thread to deteriorate into juvenile ad hominems. But not before there were some very polite and coherent comments. Some astute trader mentioned that TI and Franz were probably going to get a visit by the CFTC soon.
Lo and behold! We were told not soon after that yes, Franz was on a simulator. Those dollars that he was throwing around were just digits dancing on the monitor and were not really in play.
Next thing we know, Franz “retired”, due to bad health; TI’s website was overhauled and all mentions of Franz excised and the threads on ET were also erased. Oh and this new Yahoo! Group was created by a whistle blower from within TI to organize legal action against Franz and TI.
If you’re a vendor, the moral of the story, is to watch where you tread. The same medium that allows you to market your services so freely and inexpensively can be used against you. Venture into ET to make outlandish and fraudulent claims and you might very well get your lungs ripped out.
Finally, I can’t leave this topic without mentioning the role of the financial press. TI bought an advertorial (an ad that looks like an article) on SFO and Traders World Magazine did a fawning piece on Franz. I hope that this whole sorry episode can serve as a wake up call for the them and their peers so that next time, they don’t think that due diligence is just pretty sounding legal jargon.
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