Conservative Media Sell Out Their Followers To A Disgraced Financial Firm
Blog ››› ››› ERIC HANANOKI
Stansberry & Associates, an investment research firm catering to right-wing audiences' fears of President Barack Obama, has been fined $1.5 million for engaging in "deliberate fraud" and profiting from "false statements." Despite its shoddy history, numerous conservative outlets and personalities including Newt Gingrich, Fox Business, Glenn Beck, Mike Huckabee, Alex Jones, WND, and The Washington Times, have helped legitimize the firm and its wild investment schemes. The firm has also enlisted the help of former Fox News contributor Dick Morris, who has frequently promoted the firm in sponsored video pitches.
Stansberry & Associates was founded in 1999 by Porter Stansberry and claims to have "been predicting the most promising emerging trends and the most influential economic forces affecting the market - with uncanny accuracy - for the past 13 years." Stansberry advertises its services to right-wing audiences with attacks on President Obama and warnings about a forthcoming apocalyptic type collapse of the American government and financial system. Stansberry emails carry subject lines like, "A Survival Secret That Could Save Your Life."
In 2007, Stansberry and his firm -- then called Pirate Investor LLC -- were ordered by a district court to pay $1.5 million in restitution and civil penalties as a result of a Securities and Exchange Commission complaint. As reported by the Baltimore Sun, Stansberry was accused of "disseminating false stock information and defrauding public investors through a financial newsletter ... They claimed investors could double their money if they paid $1,000 for a stock tip involving Bethesda energy company USEC Inc. In total, 1,217 people purchased the report, although 215 of them got their money back after complaining."
A judge in 2007 ruled that Stansberry's activity "undoubtedly involved deliberate fraud" and "making statements that he knew to be false." An appeals court later found that "it would take an act of willful blindness to ignore the fact that Appellants profited from the false statements." Stansberry's defense of his actions can be found here, and a group of publishers, including The New York Times ("The Right to Be Wrong"), defended Stansberry's case on First Amendment grounds.
The Social Security Administration's Office of the Inspector General announced on September 12, 2011, that Stansberry & Associates "agreed to pay a $55,000 civil monetary penalty to the Social Security Administration" to settle an allegation it violated the Social Security Act. The firm settled the case by paying the fine while not admitting a violation. SSA's complaint alleged that Stansberry advertised it services by claiming to have information from "insiders" on how to increase your Social Security check, and "the SSA OIG believed that the characterization of Stansberry's SSA contacts as 'insiders' falsely implied that the information was not available to the public. The claimed 'insider' information was, in fact, available to anyone upon request."
Photo Credit: Youtube
Conservative Media Host Stansberry & Associates For Investing Advice
Despite Stansberry & Associates' history of fraud, shady practices, and transparently ludicrous investment pitches, conservative outlets like Fox Business, WND, and Glenn Beck have welcomed the firm as financial experts in recent months. For instance:
- Stansberry is a columnist for WND. Since January, WND has published 10 of Stansberry's financial advice columns. WND describes Stansberry as a "well-known investment adviser" who exclusively offers WND readers his insights. WND publisher Joseph Farah has emailed readers on behalf of Stansberry claiming the firm has found "a rarely publicized loophole in the consumer banking system" to "accumulate some silver anonymously."
- Fox Business' Markets Now hosted Stansberry & Associates analyst David Eifrig on May 1, 2013, to discuss the bond market. Fox Business made no mention of the firm's shady past. To the contrary, anchor Dennis Kneale suggested at the conclusion of the segment that Eifrig's Stansberry newsletter, Retirement Millionaire, has been a winner for investors. Retirement Millionaire claims to show its subscribers "secrets" such as "How to help prevent cancer with two foods" and "How to receive a free wine vacation."
- Porter Stansberry appeared on the May 2 edition of Glenn Beck's radio program "to talk about gold and the reasons for holding it." Beck held up Stansberry as a financial expert during the interview, and promoted his website. He also thanked Stansberry "for your sponsorship" of the program. A note on GlennBeck.com states that "Glenn's radio and TV broadcast from the NRA is brought to you by PrimeGuard Personal Defense, Target Focus Training, and Stansberry and Associates Investment Research."
- Conspiracy theorist and radio host Alex Jones has hosted Stansberry throughout the years on his program. Stansberry appeared on the November 15, 2012, edition of Jones' program to promote his website and claim that Obama is seeking a third term. Jones enthusiastically praised Stansberry and his ideas during the interview. Jones also appeared on Stansberry's own radio program in January for "a friendly, spirited discussion about the current political environment of the United States, gun control laws and what each calls the socialist agenda of the United States government." Jones' website Infowars.com has reposted financial articles (see: April 3, April 3, April 25), by Stansberry, accompanied by "Sponsored" links to his company's website ("Barack Obama's entire presidency could be ruined by this single, approaching event"; "Don't let government spending destroy your savings"; "There's a 100% legal way to hide both money and income from the government").
Numerous Right-Wing Newsletters Send Emails For Stansberry
Numerous conservative newsletters have sent sponsored emails from Stansberry & Associates to their email subscribers. In 2013 alone, Media Matters has received advertisement emails for Stansberry Research through such conservative newsletters as Dick Morris Reports; Gingrich Productions; Human Events; Mike Huckabee; Newsmax.com; Townhall.com; and The Washington Times. The sponsored emails contain language from the newsletter indicating that the ad does not necessarily reflect the views of the newsletter.
While Stansberry has rented out CNN host Newt Gingrich's newsletter several times, a Gingrich spokesperson previously claimed that Stansberry is blacklisted from associating with Gingrich. ABC News reported in November 2012 that after a questionable email was sent by Stansberry to another Gingrich list managed by Human Events, then-Gingrich spokesman R.C. Hammond said, "We do not rent to the entity in question ... In fact, we go to lengths to vet where we rent." ABC also reported that "Gingrich has a say over which advertisers can have their messages go out to the [Human Events] list."
Stansberry's emails prey on conservatives' fears about the Obama presidency. Recent emails include subject lines like:
- "Bet you don't know this about Obama" [Sponsored email in Washington Times newsletter, 7/25/13]
- "A Survival Secret That Could Save Your Life" [Sponsored email in Newsmax newsletter, 7/17/13]
- "New Scandal in the White House?" [Sponsored email in Gingrich Productions Newsletter, 7/11/13]
- "Astonishing find in Michelle Obama's tax returns" [Sponsored email in Gingrich Productions newsletter, 6/20/13; sponsored email in Townhall newsletter, 6/13/13; sponsored email in Newsmax newsletter, 6/6/13]
- "Why You Must See Line Item 12 of Michelle Obama's Tax Returns" [Sponsored email in Dick Morris Reports, 6/19/13; sponsored email in Newsmax newsletter, 6/17/13]
- "Could This be Even Worse Than ObamaCare?" [Sponsored email in Newsmax newsletter, 5/13/13]
- "The Big 2015 Surprise For Democrats" [Sponsored email in Newsmax newsletter, 4/17/13]
- "One thing that could ruin Obama" [Sponsored email in Newsmax newsletter, 3/24/13; sponsored email in Townhall newsletter, 3/20/13]
- "One thing Obama hopes you never figure out" [Sponsored email in Dick Morris Reports, 1/3/13; sponsored email in Townhall sponsored email, 1/3/13]
Stansberry also sponsors videos for Dick Morris' website. A message appears at the end of several of Morris' recent "Lunch Alert!" videos with Morris stating: "This video was sponsored by Stansberry Research. They have some important information that I think could really affect your future. I found it fascinating and I urge you to look at it at the end of this video." Morris has also filmed numerous other sponsored reads for Stansberry in recent years at the end of his videos. Morris has a long history of dubious ethical practices.
One of Stansberry's pitches involves scaring potential customers that the American economy and government will collapse, and martial law will be imposed:
As this problem comes to a head, I expect there will be a near-complete shut-down of the American economy. Life as we have known it for more than 40 years will essentially cease to exist. Our governments on both the Federal and State level will shut down. Banks will not open. Businesses will at least temporarily shutter their doors. I expect we'll see martial law, enforced by the U.S. military.
The video concludes that "the savings of millions will be wiped out" except for the people who "take a few simple steps and take charge of your family's fate" -- by subscribing to Stansberry's monthly newsletter, Stansberry's Investment Advisory, for $49.50.
In November 2012, Mother Jones' Asawin Suebsaeng reported on another Stansberry scheme warning that Obama will somehow circumvent the 22nd Amendment and grab a third term in office.