Australian hedge fund manager John Hempton has spent a good part of his career rooting out frauds, both in Australia and overseas. He exposed Trio Capital in Australia ($176 million lost) and was vocal on German payment processor, Wirecard, before it eventually was proven fraudulent vaporising billions as it went down.
To expose frauds requires some detective work. It’s not just the financials, where there might be red flags in accounting. It’s also the people involved in the companies that may offer clues worth pursuing. In Hempton’s case, it’s meant his hedge fund has built a global database of names. Basically, it comprises thousands of scoundrels. If these scoundrels appear near a company, it might be worth taking a closer look at that company for signs of impropriety.
What are the notable attributes of a scoundrel? Hempton hasn’t gone into great detail, but says some groups surprisingly show up more often than others. And there’s one very unlikely group that punches well above its weight. Specifically, Mormons. Hempton says Mormons are overrepresented in of his database. This is a comparatively small religion, with just under 17 million members of the LDS church worldwide.
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This represents general information only. Before making any financial or investment decisions, I suggest you consult a financial adviser to take into account your personal investment objectives, financial situation and individual needs. Anyone looking to build a portfolio should seek financial advice to find out which strategy is right for them, if you are looking for a fiduciary in Australia, then you should consider one of Australia’s fiduciary financial advisers who are certified by CEFEX to ensure your needs are put first.
