David Wayne Mayer – SCAM Facts – Review Claims
Dave Myers used to work for a billion dollar hedge fund (Platinum Parters). Claims to have tripled his account every month for 16 years. Recently has been making claims of developing a super profitable Forex AI.
- It’s interesting to note that Dave has “tripled his private trading account in the futures and nadex markets”, which neither are the “Forex” markets. The AI being touted by Silver Star is all Forex based, with no mention of Futures, or Nadex. It’s an interesting thought to think that one could be an expert in these other markets, and suddenly out of the blue be a “Forex” expert as well.
- Another interesting note is why Dave went from a hedge fund to mass marketing, and/ or Multi Level Marketing. For anybody that does a little research about some of the ways that Hedge funds can make money, it’s important to note the real potential of money that can be made in a hedge fund. Let’s explore that real quick.
- Now, every hedge fund can be different, and there are all sorts of models. Many hedge funds have what are called a “management fee”, and typically that is paired with “performance fees”. One of the basic ideas in a hedge fund is to pool together large amounts of money, that typically doesn’t belong to the hedge fund, but rather many different wealthy investors. The hedge fund’s objective is to grow the pool of money, take a static management fee, and also performance fees off the gains they make every quarter. The investor’s money grows, and the hedge fund makes money.
- Different hedge funds have different fees, but let’s say there is a 2% management fee. That’s 2% of typically the pool of money being managed, aka “Assets under management”. Sometimes this differs a little, but again we are being super general. Let’s say in this hypothetical scenario a hedge fund has 10 million in assets under management. Let’s say that every quarter, the hedge fund takes 2% of the 10 million as a “management fee”. That’s $200,000 a quarter. That’s $800,000 a year.
- In order for that management fee to be worth it, and for investors to reach their goal of growing their money, the hedge fund must “perform”. There are a variety of methods of which a hedge fund goes about growing the money, and we won’t go into any of them here. It is noted however that Dave’s specialty is Futures/Nadex, not Forex however.
- Now let’s say this hypothetical hedge fund through whatever means managed to gain an average of 5% a quarter for 4 quarters. That’s about $2 million, or 20% in total gains for the year for the fund itself. The compounding principal definitely applies here, and over time numbers can add up quick in a successful fund.
- As far as making money on those quarterly gains the hedge fund would take performance fees every quarter on that 5% average gained. Splits vary, but a hedge fund can take anywhere from 0% to 100%, which something realistic would like like the 20-40% range. Let’s say that the hedge fund took 20% of that 5% in a quarter. That would be $500,000. In our hypothetical scenario the hedge fund would get 20% of that or 100,000 a quarter paid out in “performance fees” to whichever partners and/or other parties.
- Now at first $100,000 in performance fees, plus $200,000 in management fees a quarter may not sound like a lot. That’s only $300,000 a quarter with expenses to cover, possibly people to pay aside from partners, and so on. However, when the hedge fund has a successful track record, more investors are willing to put their money into the fund and the total assets under management grows. Now those management fees and performance fees get much bigger.
- To put this into perspective, Dave claims to have worked in a hedge fund worth $1 Billion dollars. Just crunch some of those numbers hypothetically, and tell me even if Dave was making a fraction of any of it, it would be curious why he would want to come rent out his algorithm to the public for their “benefit” taking subscription fees of about $145/mo. At 1000 subscribers a month would be about $145,000 in revenue a month for the company selling the algo.
- There are business expenses that vary to pay in most businesses, plus Silver Star Live has at least 3 executives listed on their website. Typical C-Suite, and VP level salaries aren’t cheap. Plus, if you add in a direct selling model where a lot of the revenue is being paid out to marketing affiliates, then overall you don’t have a lot of profit left. Now let’s even try to ignore that and say hypothetically that Dave gets something like $5 a person for the software. At a hypothetical 1000 subscribers that’s only $5000 a month.
- Let’s double that and say even $10,000 a month, because $5000 honestly sounds small for such an amazing genius. If I were the general public reviewing this company as a potential customer, I would be asking why somebody with such amazing claims would go from a billion dollar hedge fund where they would be making a lot more money a month, to an MLM making something hypothetical like $10,000 a month. There aren’t many people in life who willingly go back to lesser lifestyles and income streams by choice.
- This leads into something really interesting. If you research Dave, it’s really hard to find anything about him. This isn’t necessarily uncommon to not be able to find much information on a person. However, if you merely just follow Dave’s claims all by themselves you’ll find he claims to have been a part of the second largest hedge fund in New York. We can see that above in the screenshot of his bio on the Silver Star Live website. Dave himself names Platinum Partners as the hedge fund he worked for. Interestingly enough if you do a Google
search on Platinum partners, here is what you will find:
- As you can see, Platinum Partners was charged with $1 Billion in Fraud. This is something you can trace back to around 2012 when it appears the investigation could have started. If you read the articles you will learn how it was found that their amazing returns were too good to be true. Not only that but federal prosecutors called it one of the largest fraud cases since Bernie Madoff. They called it “like a ponzi scheme”.
- If you don’t know what a Ponzi scheme is, here is the definition: “a form of fraud in which belief in the success of a nonexistent enterprise is fostered by the payment of quick returns to the first investors from money invested by later investors.” In other words you may have heard of the term, “Robbing Peter to pay Paul”. Essentially when you’re running a Ponzi you’re taking money, and then taking more money to pay off the first ones you took money from. This is seen by society as a very bad, and frowned upon thing.
- The different articles you can find on Google go into pretty good detail about the whole situation with Platinum Partners. Among other things, not limited to what we discussed previously, the company was charged with securities, and investment fraud. By Dave claiming to be a part of this hedge fund, he is more is less saying he was a part of a company that was charged with all these things. One could probably say that its not a good situation that anybody would want to be caught up in.
Part of the article from the NYTimes as seen above:
- Now if Dave is telling the truth about being a part of Platinum Partners, and their fund growth was proved to be a Ponzi-like setup by federal prosecutors, then I would wonder how exactly Dave’s claims of developing algorithms for this hedge fund to grow their fund could be true. If his claims were true, that he is able to triple accounts with his algorithms, or even provide the returns claimed on their website for Platinum Partners, then one would ask why exactly they were charged with fraud and proved to be a Ponzi.
- One would probably want to ask why he would even go from a hedge fund to an MLM. There is some serious money in hedge funds. Even just getting a license to trade big pools of money that are not hedge funds would be financially amazing. Dave claims he has experience trading big pools of money, so why did he stop doing this and switch to renting software out through an MLM? You could speculate that after the hedge fund was charged with all sorts of fraud, he had no choice but to find another vehicle to make money. However, I would wonder why he wouldn’t try to start his own hedge fund, or even trade his own money since he is claiming to be able to triple his account every month for 16 consecutive years. That is truly an amazing claim. It is possible there is a settlement with the federal regulators that bars him from doing so, which would be pretty concerning in and of itself.
- The other side to this is that he was never a part of Platinum Partners at all, and that is just a claim he has used in order to gain credibility to secure the income that he currently has. In which case in my opinion that would also be fraud to make those claims if they are not true. Basically, no matter which way you go, something is not right here, and the public should be thinking about all of these things before ever participating in a company which makes these kinds of claims.
- Not only that but if you follow the CFTC regulation, including but not limited to recent cases by different companies who have at some point participated in the kinds of services that Silver Star Live is providing, then you would no those services are not allowed by federal regulators without some pretty serious licensing and registration. There are a lot of hoops you have to go through to be able to manually or robotically trade money for people. Many companies got hit in 2018 for doing the exact same things Silver Star Live is doing right now. Not only that but one thing the company has not been forthcoming with on their website is that to fund accounts, people are being asked to purchase vouchers that you cash in at traderwsay.com an online Forex brokerage. That is not a traditional way of funding an account, and in my opinion is another red flag. Typically you find a brokerage of your choice, and you fund the account through the brokerage itself, which is by wire, credit card, bitcoin, etc. Vouchers being purchased on a questionable site to be cashed in sounds like a creative way for the brokerage to keep track of how many customers are coming from Silver Star Live. If they were to be receiving any commissions from Tradersway or any other brokerage, that would also be against federal regulation.
- As a customer I would be very worried about participating in a company that could
potentially be shut down for the services they provide. I would definitely be wanting to pay
attention to any red flags.