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Show (S)rm-((kueua 5imea I:' (SECD 411700) Published each Thrusday for $7 per year by the Orem-Geneva Tunes, 546 South State Street, Orcm, Utah 84057. Second Class Postage Paid at Orem, Utah 1'lJSTMASTER: Send address rh;ni:is to the Orem-Ccncva Tiiiu-s, P.O. ftox 65, Omn, litiliiSliM. f- II L .ILlXMlNATINi; TUB IMIOHKKMS, THIS I'KOI'I.K. TIIK ISSI KS OK Ol H TIM? Fraud: Hoiv To Avoid Being A Victim J If someone wants you to put money into a "high-. "high-. return" investment, but "they can't explain it to you so that you can understand it, and your accountant ac-countant can understand it, and your lawyer can understand it, then don't have anything to do with it." ITiat was the advice of a Brigham Young University business management expert during the second annual Management Society Conference on campus recently. Dr. Stephen D. Nadauld, director of the university's master of business administration program, was one of several experts who spoke on topics related to the conference theme, "An Unchanging Un-changing Ethical Standard." In his presentation, "The Great American Scam and How to Avoid Being Victimized," Nadauld pointed out that intelligent people who easily see through a flamboyant, phony preacher can still be taken in by a similar con game in a different guise. The setting may be a quiet, conservative business office with a picture of an LDS Church ! leader on the wall, for example, but the proposition ! may be much the same-high returns, little or ho risk. "The first and foremost feature of every fraud is promised high returns," Nadauld explained. The proffered investment opportunity may be -in precious stones or metals, commodities, or some other thing of value. The promised rate of return is typically far higher than anything offered by legitimate financial institutions. One scheme promised a rate of return that would have yielded, within a little more than three years, an amount equal to half the nation's gross national product. But in a typical fraud, "the first few promised high return payments are always made," using money from friends and acquaintances recruited by those first eager investors. Eventually, though, the resulting pyramid cannot sustain itself and collapses because the number of investors needed to continue those high payoffs becomes astronomical. Another characteristic common to investment frauds is an implied endorsement by a respected community leader or other authority figure. In Utah, con artists often intimate they have the blessing of some respected LDS Church leader. A fourth characteristic of investment scams is that the con artist usually approaches the prospect ; in a spirit of altruism, pretending a desire to share something wonderful. The inflationary economy of the late 1960s and early 1970s in. which many investments really did appreciate dramatically, particularly in real estate, made it seem for many, that simply "daring to invest" led to wealth. . "Having seen some easy money for a period changed our thinking, ever so subtly, and caused us to question the conventional wisdom" which tells us that "there is no free lunch," Nadauld continued. : Then, too, "There's something about our ego that says it's more important to get. a good deal than it is to be careful." : Some people jump in because they're excited by positive thinking philosophies that tell them success is close at hand if only they will trust in themselves. Others say later that they were in a financial bind and "reached for a straw." He said people looking for a profitable investment in-vestment should guard against fraud by carefully scrutinizing any program promising unusually high returns. They should know whether economic value is actually being created by use of the money invested, in-vested, or if wealth is simply being transferred from one pocket to another. I There are three broad questions Nadauld asks himself in examining any investment opportunity: ; -First, "What is my motivation?" Is it simply tin get a high rate of return? Economic laws dictate tjiat a high rate of return cannot be guaranteed, and (hat the promise of high return always carries a high risk with it. ; -Second, "What are the characteristics of the (leal? What makes this thing work?. ..Have I used proper business procedures" in examining it? J -Third, "Does it square with my understanding of business principles?" Often he is asked, Nadauld said, whether the brincipals in an investment scheme deliberately perpetrated a fraud, or whether it might be possible fo take the more charitable view that they simply fxercised poor judgment. It's a difficult question to wswer, he commented, but many whose plan goes jiwry because of initial errors in judgmnet end up .ommitting fraud because they don't have the pourage to admit their mistakes. Instead, they Continue with their scheme, in a desperate attempt to salvage it, until it simply falls apart, j He commented that the light sentences and lack vf social stigma for those who commit fraud encourage en-courage this type of crime. While many victims, want to be charitable and refuse to prosecute, "I suggest to you that it is very difficult for a person like that to learn a lesson" unless he or she receives "ome punishment. PR0UD ' Xfy. TRADITION t 1 .- sauo A Concerned Citizen ,eV POLITICIANS! FT M 1 LEFT 6V CONSERVATIVES IN MARXIST COUNTRIES! IJR2 Gipley Nw Seri Aw A xA ' 1-98 2 ... 1 V&r-aitv Clyde E. Weeks . September is the month when the pace of life quickens across America: students return to school, community projects begin and business looks forward for-ward to the fall season. The U.S. Postal Service has chosen this time to remind Americans how the written writ-ten word and letter-writing bind our nation together, and how the Postal Service serves all citizens in all corners of our country. National Card and Letter-Writing Week will be held Sept. 19-25. For the past two years, this event has sparked the attention of educators, businesses, our customers and the media. Co-sponsors of National Card and Letter-Writing Letter-Writing Week this year include the National Council of Teachers of English,, the National, Association of Elementary School Principals, the National Art Education Association, the American Library Association and the American Family Society. We are focusing on two projects this year: the Student Stamp Design project and a continuation of the Volunteer Scribe Program. STAMP DESIGN PROJECT In the Student Stamp Design Project, teachers are being asked to transmit the students' designs to tlieir local post offices so that they can be exhibited there, as well as in schools, libraries and other local public facilities. The designs will be reviewed by members of the National Art Education Association before being submitted to the Postal Service's Citizens' Stamp Advisory Committee. The committee will recommend selected designs to the Postmaster General for final approval. One of these designs will serve as the basis of a U.S. postage stamp which will be issued at a later date. ANY SUBJECT Students participating in the project are free to submit designs on any subject, but it is recommended recom-mended that they concentrate on thematic subjects, rather than on persons. Particularly appropriate subjects are friendship, love, physical fitness and recreation, patriotism, Christmas and other holidays, building a better world and similar topics. The stamp design may be vertical or horizontal, as long as it is in the ration of 0.84 by 1.44 inches (preferably developed five times actual size to 4.2 by 7.2 inches.) Designs may be prepared in any medium-pen and ink, pencil, crayon, watercolor, poster paints, oils, etc. NOV. 30 DEADLINE All designs must have the following information on the reverse side: student's name, teacher, grade, name of school and school address. All designs become the property of the U.S. Postal Service and no designs can be acknowledged or returned. Designs must be submitted to local post offices no later than Tuesday, Nov. 30, 19S2. In this community I know there are many talented and imaginative young people in grades kindergarten through high school. Since Orem has more children per family than most cities, there may be several children in one family who will be submitting proposed stamp designs. Depending on the number of designs received at the Orem Post Office, they will all be displayed here and possibly in other locations. I urge every youngster with a flair for design to take advantage of this opportunity. Who knows? You might be the designer of the next U.S. postage stamp! LOVE LETTERS Love letters have a very special value to people who have written or received them, but rarely do they have much cash value. An Associated Press story with a London dateline recently reported that Franco's national library paid $3.r),2(M) for more than 200 love letters from the late French writer, Paul Valery, containing 30 unpublished poems. The letters were written to Valery's mistress, the Belgian critic Emilie Noulet. Their sale was part of a two-day event which included manuscripts by Beethovan and Wagner, a letter in English by painter Vincent van Gogh and the autograph draft of Mussolini's revolutionary proclamation the evening before the 1922 inarch on Rome. Proceeds of the sale totaled $671,620. . Waterways Create Complex Issues A touching plea by Beth Peterson, founder of "Save Our Children" captured cap-tured the attention of Utah Senator Orrin Hatch, Utah County mayors, newspersonnel, and others who met Wednesday to discuss the controversial CUP proposal to build several new canals through north Utah County cities. Hatch responded sympathetically to Mrs. Peterson who lost a son and a nephew, ages seven and nine, in the Murdock Canal. In her brief remarks she deplored a callous attitude by water board officials who refused to turn off the water through the Murdock Canal long enough for searchers to locate the bodies. "You know they are dead; they vill come up sometime," was the official response, she said. One body was in the water nine days. Mrs. Peterson was accompanied by Dr. Carl Bell of Pleasant Grove who called for a "spirit of cooperation" in solving the complex problems of water conveyances. Headed by lpine Mayor Don A.i! Christiansen who conducted the" meeting, local mayors representing the Timpanogos Planning and Water Management Agency addressed the problems already created by the Mur-cock Mur-cock Canal and the impact further construction con-struction would have. Most felt a single boxed culvert would meet future water needs as well as today's needs. Pleasant Grove Mayor Dave R. Holdaway pointed out that when land needed to build two new systems is taken off property tax roles the impact will be felt for a hundred years. "That impact should have some consideration," con-sideration," he said. "But," he added, "Unelected officials (water boards) don't care to listen to elected officials." Holdaway also reported on the threat an open canal poses to the safety of - citizens particularly when it goes through a major residential area. Senator Hatch listened intently to issues presented and cleared up criticism that he had not been interested. in-terested. He said, "No single issue has consumed as much of my time proportionately propor-tionately since 1979." He said he had never received a memo he requested from the group outlining their feelings and assured them, "You will never see the day when I am not willing to meet with mayors together or singly." Hatch said he doesn't know if the complicated matter can be resolved and doesn't know what position senators should have, but added, "The matter should be resolved locally and should not be in the political area." He offered to check into federal laws and positions in the matter and said his office of-fice is available for assistance. ; Hatch had before him a study recently compiled by. Mountainland .' Association of Governments under the direction" of Governor Matheson concerning con-cerning Jordon 4 and Alpine 3 Conveyance Con-veyance Alternatives. He said he would study it thoroughly. One of those present commented that the proposed waterways couldn't be built for the cost of refurbishing the Murdock. Another said the canal is in violation of federal standards for ; treatable water conveyances. The committee promised an official response to the study following an address ad-dress by Governor Matheson on Tuesday. reals Disease Barrier UtahB Utah's livestock industry has won the battle against brucellosis. According to Dr. Kenneth Creer, Director of Animal Industry, "Utah has been declared a brucellosis free state by the U.S. Department of Agriculture, making it the only state in the western United States to attain such a status." Brucellosis is a common disease found in animals and is most frequently characterized by fetal abortions. However, the disease can also be . transmitted to humans through contact with an infected animal or through consumption of contaminated food.. When humans are infected, in-fected, the disease is called undulant fever. Becoming a brucellosis free state is significant because it allows those in Utah's livestock industry to freely trade cattle with other states, thus avoiding burdensome restrictions and testing requirements. It also cuts down on financial losses due to drops in production and animal deaths. Oran-Geneva Times- -September 9, 1982 Caution Is Advised On Short Term Investments For more than a year banks, state savings and loan companies and other financial institutions have been encouraging small investors to buy repurchase agreements, called repos. These repos are promoted as a sound investment opportunity. They are made available for as little as $1,000 at competitive money market rates. Dr. Don L. Snyder, extension ex-tension economist, Utah State University, reminder remin-der that repos are not money market mutual funds or insured certificates cer-tificates of deposit as some investors ; have assumed. The repurchase agreements, also called money funds and investor funds, may or may not be a good investment for an individual or family. It's important to know what they are and what can be expected of them before purchasing. Snyder explained that when you buy a repo, you acquire an interest in a group of government securities held by some financial institution. In effect, you make the institution in-stitution a loan the matures in 89 days or less. The institution agrees to repurchase your share and pay interest in-terest on that share. Since repos are not deposits, they are not guaranteed or insured by the U.S. government or the Federal Deposit Insurance In-surance Corporation. Advertisements -indicating that repos are backed by U.S. government gover-nment securities might be misleading. Actually the securities set aside as collateral to secure your investment will likely be treasury bills or issues of various agencies of government, Snyder said. He noted that the Federal Reserve Bank of San Francisco has notified its member institutions in-stitutions that customers should be told whether they have a perfected lien against such underlying collateral under state law, and whether it is being held by an independent in-dependent trustee or custodian. The legal consequences con-sequences of not having such a lien should be described. Customers buying repos should also be told that the collateral's market value could depreciate before the agreement matures. This would make the investor an unsecured creditor of . the financial institution. The investor would owe the difference between the repurchase price and the actual market value of the underlying collateral. Advise customers that the interest paid on their investment is not necessarily related to the actual yield on the underlying un-derlying collateral, the Federal Reserve Bank directed. The bank will pay a fixed amount at maturity (including interest) in-terest) regardless of fluctuations fluct-uations in the market value of the underlying collateral. Usually general banking assets will be used to satisfy the bank's obligation to the investor rather than actual ac-tual proceeds from the sale of the underlying security. . The extension specialist advised anyone considering repos to review the printed information: infor-mation: on the agreement, referred to in the prospectus, or indicated in-dicated in the offering circular or other document. Letter To Editor Indksn School h'cccsssry I strongly disagree with Hansen's remark that there is a lack of interest in the In-termountain In-termountain Indian school. Let's face it. Hansen would say anything and do anything to support his party politics. The Republican platform is to cut spending spen-ding at the expense of people who need those fiscal services to make ends meet. Of course the Indian people also know that Hansen is out on the warpath to annex the Indians and their reservations. It then becomes not only a Republican political move to close the In-termountain In-termountain Indian School, but it also becomes a moral issue with the rights and privileges of American Indians at stake. What will become of those people who currently work at tne school? What will become of Brigham City which now takes in thousands of dri '- annually as a result of Intermountain? What about the unemployed? unem-ployed? Most of all, what about the Indian student? If Hansen were to be reelected, he would push for policies and procedures which would negate Native American rights by abolishing old ' and current treaties. The Intermountain Indian School must continue. It is an institution in-stitution which has a legacy of success in the field of higher education and opportunity. - What would compel a man to turn his back on his own state and the people he is supposed to serve. The answer is simple, "The power of politics at the people's expense." J. Lone Wolf M j .bLe""- '" ill 1 1 U L' '! " :" CI. -"ZJ to. trade up. The only buy beller than a quality, fully eleclionic Olympia ES Series Winter is a greal buy ol an ES tor hundreds less. Thanks' to your , enthusiastic response, Olympia has increased production and lowered Prces: ES100 previously $1,195 now $999. ES101 previously $1 295 now $1,199 ES105previously$1.595now$t,399andonl$999with lrM-inihrough September 15, 1982 : - 'l8MCoir(timj Solocli.'.'" HI loi II l an alhmunrv ol tllXMcs) In wo.kinij oiiirf Trade' np: with working Correcting Selectric 111 trada-in Dusinsss Osffcfec' 324 VUn UnUt, ttm rb-st 374-0723 i : S i'j |