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— On air: beware. Cock an eyebrow at money advisors who flaunt their expertise over the airwaves. They may be getting secretly paid to tout a stock or have an undisclosed relationship with a firm they laud. Increasingly these days, such commentators pay for their air time. Last week, the Securities and Exchange Commission charged that New York's Courtney D. Smith, a well-known television talker, took $1.1 million in secret payments to tout the stock of a now-defunct Van Nuys company, GenesisIntermedia, on CNBC, CNN, CNNfn, and Bloomberg TV. The regulatory agency noted that an uncharged accomplice in the arrangement was "a Saudi Arabian national reputed to be an international arms dealer and financier." That reputed arms dealer was Adnan Khashoggi of Iran-Contra infamy. Along with some other financial journalists, I have reported Khashoggi's ownership position in Genesis through an entity on the offshore tax haven of Bermuda.

San Diego was involved in this one: Amr (Anthony) Elgindy, formerly an Encinitas resident, now a prison inmate, had the GenesisIntermedia scam figured out back in 2001, although he overstated his case by issuing a "terrorist warning," rather than simply saying the stock was overpriced. (On January 24, Elgindy was convicted of fraud, racketeering, and extortion.)

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San Diego media personalities have questionable records. Consider W. Aubrey Morrow, a financial planner who once did a series on the topic for public television. He has authored books on financial planning and recruits clients through seminars. Morrow has a two-hour radio show Saturday mornings on KOGO. "It's what we call a brokered show," says Cliff Albert, program director of KOGO. "Aubrey Morrow pays for the time."

Don Bruning, who now lives in Hemet, used to listen to the show and attend Morrow seminars. "I was a lamb sitting there for the slaughter," says Bruning. He had received money from an estate and went to Morrow. "I told Morrow I wanted it safe."

One of the guests on Morrow's show headed a company selling a device that alphabetized discount coupons for shoppers. Through Morrow's company, Financial Designs, Bruning and his family plunked $255,000 into the coupon-alphabetizing company, called Direct Access International. Through Financial Designs, the Brunings also put $40,000 in an outfit called DocuVision, which was supposed to provide a whopping 20 percent interest. "All the investment funds have been lost," concluded arbitrators when they ruled last year that Morrow had to pay the Brunings $207,000. The investments were unsuitable for the Brunings and were not registered with either the Securities and Exchange Commission or California, ruled the panel.

Morrow was on the advisory board of Direct Access and had a relationship with DocuVision. He was affiliated with both companies, concluded the panel. DocuVision "could only pay Morrow back if he could raise money from other people, and the other people were Morrow's clients," says Floyd Brown, Bruning's attorney.

Morrow's attorney, Erwin J. Shustak, says that isn't true, but Morrow did have his other clients in both Direct Access and DocuVision. "Aubrey had the same investment everybody else had," says Shustak.

Morrow claimed that the Brunings got into the two investments through another person, Steve Schroeder, who was only supposed to help with the radio programs and wasn't authorized to sell investments. However, Schroeder occupied a desk in Morrow's office "and was director of communications for a subsidiary," says Arthur Leider of Investors Arbitration Specialists, who helped in the case. The arbitrators weren't buying the Schroeder alibi: Morrow "was the primary cause" of the Brunings' investment "and failed to disclose material information" to them, the panel concluded.

Morrow used a similar ploy back in the early 1990s. After seeing him on TV and attending one of his seminars, two retired San Diego educators in their 80s entrusted their $775,000 nest egg to Morrow's firm. He determined that the nest egg should be sold off and the money shifted to new investments. But Isaac Cubillos, who worked in the office and was doing the paperwork, diverted $200,000 of the couple's money to his own account. Morrow claimed that Cubillos was an independent contractor, not an employee. And Morrow said he couldn't repay the $200,000.

With help from Sharon A. Dodson, the accountant who discovered the fraud, and from Morrow, Cubillos spent 18 months in prison. But by 1998, he had become a regular on KPBS radio's Editors' Roundtable. "We asked him to stop participating," says a KPBS spokesperson. Later, Cubillos joined Hispanic Vista.com, an online Latino publication, as managing editor. That didn't last, either. "There was never an indication of wrongdoing; it was bad management," says Patrick Osio Jr., editor.

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Gabriel Wisdom is a market reporter for KPBS radio and appears on other stations, such as those subscribing to Business Talk Radio, a nationwide syndication operation. "I have a barter arrangement" with commercial stations and the syndicate, says Wisdom, acknowledging that he effectively pays money to get on the air. He is an underwriter of KPBS programs but insists that has nothing to do with his being a regular performer there.

In 1999, Frank E. Rowlen, former finance director of Vista, admitted that he had put the city in illegal investments, submitted false reports to the council, and received favorable treatment from Wisdom and his stockbroker partner, Michael Axelrod. In return, they got the Vista account, from which the pair generated $768,000 in commissions The funds were illegal under Vista laws, confessed Rowlen.

He said that Wisdom and Axelrod gave him discounted commissions (often zero) and gave him access to hot issues of stock that guaranteed him a profit. Wisdom denies Rowlen's allegations. "I was dropped from that case," he says. "I haven't had any arbitrations since 1996."

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A business broadcaster of the old school is Bill Holland of KFMB. "He does not compensate the radio station in any way," says Dave Sniff, program director. Holland gets paid if he appears in a commercial that is also on the show. His programs are low-key.

But Holland has run into trouble. A client complained that in 2001-2002, Holland put him into stock of UAL, parent of United Air Lines, as well as preferred stock of Conseco, a scandal-plagued insurer. Both went into bankruptcy, and the former is still there. Holland had put clients in United for years, including the prosperous ones, and believed that new management would sweep Conseco clean. "I have 3000 clients; I have some who are unhappy. They always say stocks are unsuitable after they go down," says Holland, flaying "ambulance-chasing lawyers," including some who advertise on his show. In the UAL/Conseco case, the complainant asked for $500,000 and was awarded $190,000.

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