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American Cash Flow Association™
( ACFA ), also known as the
American Cash Flow Institute ™ ( ACFI ), also known as the
American Cash Flow Corporation™
( ACFA ), also known as the National Mortgage Investor's Institute ( NMII ), also known as Diversified Cash Flow Institute ™ ( DCFI ), among many other names -- all founded by lawyer Laurence J. Pino, also known as Larry Pino -- Goes Under NEWSWEEK's Microscope

After 15 months she could find only ONE of her classmates who had made any money at all: One deal for a profit of $750, and one for $300.

Note brokering and investing in cash flows can be very profitable. Before you invest your money in any seminar, whether run by the American Cash Flow Institute ( ACFI ) / American Cash Flow Association ( ACFA ) or any other company, read this.

The most well-known and respected personal finance expert in the country, Jane Bryant Quinn, wrote about the note industry in a two-page Newsweek story. The article was also syndicated in her column to 154 major newspapers all over the country.

It has become the hottest topic in the note and cash flow industry.

Why is this so significant?  A published story, especially one in Newsweek and all the major newspapers, becomes part of the permanent record. One of the first things a reporter does when beginning to work on a story is to do a computer search for everything already published on the subject. From now on, this story will pop up. It’s part of our industry’s (and Larry Pino’s) permanent file. Whatever the public reads or sees on TV about the note business will be influenced by that story.

How did our business attract the attention of the national news media? Was it because it is so unique and relatively unknown? Because it offers people financing they could not get otherwise? Because it is one of the fastest-growing sectors of the financial world? No, no and no.

 It caught the eye of Newsweek because of an outfit known as the Diversified Cash Flow Institute ™ (DCFI also known as D.C.F.I.), run by an Orlando lawyer named Larry Pino. DCFI sells a class on how to be a note broker for $5,995 through highly-visible national TV infomercials, 4-page glossy ads in major airline magazines, massive direct mail campaigns and sales meetings across the country. DCFI is just one of many names that Pino uses, however. The latest is the American Cash Flow Institute ( ACFI ) or American Cash Flow Association ( ACFA ).

The Newsweek article is headlined,

"Show Me The Money"

"Larry Pino's pricey cash-flow workshops plug an easy way to get rich quick.

It's a real business, all right -- but there isn't much easy or quick about it."

That headline is restrained compared to the ones in newspapers across the country: "Get Rich Course Will Waste Your $6,000" (Philadelphia); "Keep Eye On Pitch To Get Rich" (Akron); "Grim Reality Lurks Behind Sales Pitch" (Washington State); "’Discounted Notes’ Latest in Get-Rich-Quick Parade" (Ft. Lauderdale); "Road To Riches With "Discounted Notes" May Be Rocky" (Orlando) and many, many others.

 "Note Brokering Spiel Feeds Dreams"

Newsweek reporter Temma Ehrenfeld, along with 450 others, attended a "free seminar" in New York City sponsored by DCFI. The magazine said the DCFI pitchman spewed "a spiel that feeds dreams. 'I'll show you how to make $1,000 with one phone call,' he cries. 'You deserve to be making three times as much as you're making now.' He claimed that you could make '$4,900 a month for a few hours' work: $128,367 on your maiden deal.' All this without leaving home."

The price of this dream? Just $5,995 ($2,495 for the tape course).

Newsweek paid the fee and sent Ms. Ehrenfeld to the live course. Then they waited 15 months to find out how her fellow students had done:

"We asked them how many $1,000 phone calls they'd made. Zero, as far as we can learn."

After 15 months she could find only ONE of her 32 DCFI classmates (of the 18 who responded) who had made any money at all: One deal for a profit of $750, and one for $300.

$750 + $300 = $1050. The most successful student she could find is in the hole for $4,945.00 18 months later (the cost of the class minus the $1050 profit).

$5,995 x 32 students = $191,840 for DCFI.

Quinn reported on two DCFI students (not in the above class) who said they were happy with their training.

Larry Pino's Past Associations

Newsweek reports that "Pino himself was reprimanded by the Florida Bar Association in 1988 for misusing an investor's funds." Pino says he paid the money back.

Pino worked for hucksters Charles Givens, Mark Haroldsen and Dave Del Dotto.

Newsweek says Pino's past business experience has "not always (been) in the best of company. He first lectured for (and represented, as a real estate lawyer), huckster Charles J. Givens, who ran some dubious financial-planning organizations.

Here's what John T. Reed says about one of Pino's choice of employers, Givens.  Reed is a graduate of Harvard (M.B.A.) and West Point, has authored several excellent books on real estate finance and writes Real Estate Investor’s Monthly.  Reed’s comments are reprinted by permission from his guru-rating page www.johntreed.com/Reedgururating.html

"If you look up "glib" in the dictionary, you'll find a picture of Givens next to the definition. Givens is the Cliff Claven of finance. His International Administrative Services, Inc., which did business under 16 names including some involved in real estate, went bankrupt in Orlando in the summer of 1996.

"In 1995, the Florida Attorney General got Givens to agree to pay $377,000 to cover refunds and the cost of the Florida investigation. Givens also agreed to stop making certain claims about the value of his teachings and to make full refunds to anyone who requests them within three days of receiving his materials. Two juries found him guilty of fraud.

"The Wisconsin State Bureau of Consumer Protection published a Guide for Wisconsin TV stations which lists several "Questionable infomercials," among them those of Charles J. Givens."

NEWSWEEK: In 1993 and again in 1996, juries decided that Givens had committed fraud.

"Among Pino's other stops were seminars run by Mark Haroldsen, charged by the Federal Trade Commission in 1996 with selling home business "starter kits" deceptively (Haroldsen denies it).

REED: "Haroldsen was publisher of the now quarterly Financial Freedom Report. His main claim to fame is that he invented the densely-worded, full-page, magazine, direct-mail ad to sell his book.

"Financial Freedom Report was accused of 83 counts of deceptive sales practices by the Utah Division of Consumer Protection according to a 5/19/97 KLS-TV story in Salt Lake City. Utah had received over 900 complaints about Financial Freedom Report nationwide since 1993 but only took action based on the 83 complaints from Utah residents. KLS-TV said the Commonwealth of Virginia had also taken action against Financial Freedom Report.

"The Wisconsin State Bureau of Consumer Protection published a Guide for Wisconsin TV stations which lists several "Questionable infomercials," among them those of Financial Freedom Report.

Reed says, "Haroldsen's people once called me to ask permission to reprint one of my book chapters as an article in their magazine. I said, "OK, for $375." They said they only paid $125. I said no deal. They went ahead and printed it anyway and sent me a check for $125. I sent them an invoice for $250 and a strongly-worded note. They ignored me. I then told everyone I met who had the slightest interest in Haroldsen about that incident. Many months later, Haroldsen was coming to Monterey, California to give a seminar. I plotted how I could obtain a judgment against him and have the sheriff execute the judgment by till-tapping, that is, seizing his receipts, at the seminar. About that time, he sent me a check for $250. If you'd like to be treated the way he treated me, deal with Mark Haroldsen."

Pino's past also includes a stint with Dave Del Dotto.

NEWSWEEK: "Dave Del Dotto, an earlier popularizer of "cash flow," settled an FTC action in 1996 with a $200,000 fine."

REED: "Del Dotto is a former sheetrocker from Modesto, Ca. who did infomercials featuring himself sitting on the beach in Hawaii. I debated him on Larry King Live.

"Del Dotto strikes me as the dumbest of the famous gurus. In one of the books he sold with his home-study course, he said to take advantage of a Farmers Home Administration loan. If you're not a farmer, he said, get one to "front for you." Many of the other gurus give similar advice. But Del Dotto is the only one I know dumb enough not to understand that the standard, get-rich-quick-guru way to deal with the issue is not to mention the farmer requirement. For the record, getting a farmer to front for you in a loan program that's for farmers only is a felony. Del Dotto's Modesto headquarters was foreclosed in the '90s.

"The Wisconsin State Bureau of Consumer Protection published a Guide for Wisconsin TV stations which lists several "Questionable infomercials," among them those of David Del Dotto.

"In the 6/8/98 Newsweek, Jane Bryant Quinn said that Del Dotto had gone bankrupt."

"A reader sent me an “Assurance of Voluntary Compliance” filed in court in Davidson County, Tennessee in 1996. The barely legible docket number appears to be 96-3631-III. It is labeled State of Tennessee versus Diversified Cash Flow Institute, Inc. (Pino is “President and General Counsel” of DCFI). It says “The Division of Consumer Affairs...and the Attorney General conducted an investigation of [DCFI's] business practices. These practices include the following:...using earnings claims that are not representative of the results an average participant in the training program could expect; making potentially misleading statements about the value or cost of the training program; stating that the training program was associated with a university when it was not;...and overstating the value of certification offered by [DCFI]...the Division and the Attorney General determined that certain acts and practices of [DCFI] violated the Tennessee Consumer Protection Act of 1977. [DCFI] neither admits nor denies any wrongdoing...and gives this assurance...in order to avoid the expense of litigation.” The court papers state that the DCFI training program cost $6,995.

Interestingly, the “Assurance” requires DCFI to make “verifiable substantiation of...illustrations that may not reflect the average experience of a graduate...available on request.” The word “illustrations” apparently refers to examples of student success or student testimonials. I am very suspicious of the testimonials provided by seemingly average persons on guru infomercials. The Assurance requires DCFI to stop saying the “cash flow” industry is unregulated when, in fact, TN law requires a brokers license for some of the activities DCFI covers. The Assurance orders DCFI to refrain from discouraging consumers from taking notes or otherwise keeping a careful record of the information [DCFI] provides during the introductory workshop.

One item really bugged me. It orders DCFI to not encourage consumers to go into debt in order to take the DCFI course. They do that?!"

The Heart Of The Problem

Jane Bryant Quinn cuts to the heart of the issue:

"The question with Pino workshops, and others like it, is the sales pitch.

Does it give a true picture of what it takes for success? Or does it prey on people's innocent hopes?"

She then summarizes the key points:

1) "Note brokering isn't as easy as it sounds." In spite of claims to the contrary in order to sell seminars, successful note brokers work 50 to 70 hours a week and couldn't earn a living part-time. A Pino booklet called "Getting Your First 10 Deals In 10 Days or Less" met with "um, disbelief" among seasoned note brokers questioned by Newsweek. Pino says he "barely remembers" what he calls the "broad stroke stuff" booklet.

2) "There's probably not as much money in it as you think." Invoice buyer John Fox says he has to retrain many DCFI graduates and finds most of them "unrealistic..about the opportunities to really make money." Pino says he doesn’t teach what Fox requires.

3) "The competition can be brutal. Pino claims that you’re up against "limited competition" for deals that are "as plentiful as raindrops." Veteran note broker Ed Burris calls those claims "baloney." He says he had almost 1,000 "brokers" on his contact list. Most did one transaction and disappeared.

4) You need skills. If you are "young or mature," "rich or poor," or "stuck in a dead end job"you ought to be a note broker -- at least if you believe the advertising. Not so, says Dwayne, a Seattle ironworker interviewed by Quinn who was persuaded by Pino's pitchman to borrow money to attend the class. "I was taken advantage of," he says. "It's not for working-class people...You need a background to do this."

Lorelei Stevens, a regular columnist for THE PAPER SOURCE and president of national note investment firm Wall Street Brokers (www.wallstreetbrokers.com), was quoted in Newsweek saying that these skills would help new note brokers: marketing, making public presentations, negotiation, business math, real estate finance and knowledge of the relevant law.

To find out if note brokering is for you, Quinn suggests two ways to start: Either Jon Richards’ $65 two-tape lecture and book "How To Start A Profitable Discounted Note Business" which will givew you an overview of the note business to see if it si for you. If you are sure you want to give note brokering a try, get the complete training offered in the 18-hour tape course "Profits In Discounted Notes: The Complete Beginning Course" "followed by hands-on courses offered at a fraction of Pino's price."

Quinn concludes, "Pino explains the business, too, but wanna-bes should start small. They're less likely to break their bank accounts, or their hearts."

Those who didn’t read the story in Newsweek will read it in their local newspaper, or a friend will send it to them. There’s no doubt that everyone even slightly interested in notes has or will read it.

To read the full text of Quinn's column on the Diversified Cash Flow Institute ( DCFI ) and Larry Pino, bookmark this page:

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Note brokering and investing in cashflows can be very profitable. Before you invest your money in any seminar,whether run by the American Cash Flow Corporation ( ACFC ), American Cash Flow Institute ( ACFI ), American Cash Flow Association ( ACFA ) or anyone else, read this.