Two self-proclaimed stock-picking experts who persuaded consumers on late-night infomercials to spend tens of thousands of dollars on software and other products to play the market were convicted of fraud and conspiracy in federal court Thursday.
Linda Woolf, 49, of Sandy, Utah, and David Gengler, 35, of Draper, Utah, passed themselves off as successful stock traders. In reality, Woolf lost money in the market while Gengler at best made a nominal profit, according to tax records.
They sold wares offered by a company called Teach Me to Trade. Sometimes, customers paid as much as $30,000 for the stock-picking system and software.
Although playing the market wasn’t profitable for the pair, they did make millions of dollars in commissions by traveling to hotel seminars across the country and selling Teach Me to Trade products.
Prosecutors said consumers never would have purchased those products if Woolf and Gengler h ad not portrayed themselves as successful investors.
In a monthlong trial in U.S. District Court, defense attorneys acknowledged that Woolf and Gengler occasionally misspoke or embellished in their sales pitches, but said the two were being held to an impossibly high standard, especially because the law distinguishes between fraud and “puffery” or sales talk.
“What has happened here is the government has criminalized the sale of legal products,” Woolf’s lawyer, Mark Schamel, said in a phone interview after the verdicts. “Every person in America involved in sales has to have a serious concern when they get up and go to work.”
Gengler’s lawyer, Christina Sarchio, said the verdict “has a chilling effect on salespeople everywhere” and said Gengler is reviewing all his options to get the conviction overturned.
The jury deliberated for only about three hours before convicting the two on all seven counts – one conspiracy count and three counts each of wire f raud. The government dropped eight other fraud charges midway through the trial.
Sentencing has been set for July 31. U.S. District Judge Anthony Trenga can set aside the verdicts and dismiss the case.
Schamel declined to comment on the pending motions to dismiss or on whether he might appeal.
Gengler and Woolf worked as independent contractors for Teach Me to Trade, which is a division of publicly traded Whitney Information network in Cape Coral, Fla.
It is unclear whether the convictions might result in other charges against Whitney or companies that put on similar seminars. Government agents said during trial that the investigation of Whitney is ongoing.
Assistant U.S. Attorney Derek Andreson said after the verdict that “this is an unregulated nationwide industry that targets unsuspecting members of the community. Its financial impact is devastating and it warrants continued federal prosecution.”
While Whitney has not been charged, the indictment against Woolf and Gengler said that the two relied on Whitney’s “fraudulent marketing efforts” in their scheme to defraud.
SUPERLATIVE Signs Director Claudia Abend For Spots and Branded Content
Latin American director/editor and documentary filmmaker Claudia Abend has joined SUPERLATIVE for her first U.S. representation spanning commercials and branded content.
Abend's empathetic docu-style POV has garnered several international awards for the documentary films Hit (2008) and The Flower of Life (2018). Her spotmaking credits include such brands as Procter & Gamble, Nestle and Blue Cross/Blue Shield. SUPERLATIVE has already worked with Abend, together producing a new ad campaign for digital agency Tinuiti and The Honest Company, a consumer goods corporation featuring eco-minded products.
“We found Claudia through her poignant documentaries on the festival circuit,” said SUPERLATIVE creative manager Stefan Dezil. “We are excited about her textured narratives, emotional storytelling, and her powerhouse long-form storytelling abilities, currently on her third feature film. As SUPERLATIVE continues to build our brand after premiering our latest films at Sundance and SXSW, Claudia is the kind of multidimensional artist we are excited to partner with on branded content and beyond. Fluent in English and Spanish, her reel shows real prowess with infants, food and skin products, families both young and old. Great visual storytelling and inspirational doc work.”
Abend began her career in her native Uruguay, studying film and editing in college. “My dad would show me films like Citizen Kane,” she said. “I love cinema and became an editor. It was here that I learned all about communicating human emotion.”
From the get-go, Abend hit it big as a documentary director, teaming with Adrianna Loeff on Hit, a movie chronicling pop artists of Uruguayan music. Abend took home a Best Editing... Read More