RICH MAN, POOR MAN 71 those goals while minimizing the risk of a catastrophic loss. After all, unless the latest hot trader is going to include you in his will, what does his trading have to do with you, really? Like a dog that chases cars, those who constantly chase returns often wind up flattened. The vigilant investor stays away from alternative investments that use an affiliated broker to execute trades and investigates to determine whether supposedly independent brokers and auditors are truly inde- pendent. Bayou traded through Bayou Securities and Madoff through Madoff Securities not to save on trading costs, but to control access to the information that would have revealed their frauds sooner. Bayou created Richmond-Fairfield Associates out of whole cloth as a supposedly independent auditor. Had an investor investigated Richmond-Fairfield, either in person or by sending an investigator to its offices and interviewing the people there, that one visit would have ended the Bayou fraud on the spot, saving the nest eggs of everyone who gave Bayou money from 1997 to 2005. Although they target accredited investors and institutional inves- tors, hedge fund frauds also reach investors who are not accredited when scamsters simply ignore the rules about accredited investors. Certainly, most investors have neither an understanding of the accred- ited investor definition nor an appreciation of how it is designed to protect them. There is no shortage of scamsters who simply ignore the securities laws altogether, raising money from the more than 99 percent of the population who are not trained in what the securities laws require of those who sell investments. The Scam Mall Imagine that you are a financial scam artist. How do you decrease the risk that a prospective mark will say no? What many scam artists do American Managememt Association · www.amanet.org