The Federal Trade Commission (FTC) and the NH Bureau of Securities Regulation filed civil fraud action against RagingBull.com in Lee, an online platform that has claimed to teach people about investing in the stock market. The FTC accuses RagingBull.com and its executives of defrauding consumers of $137 million during the past three years.
The company landed on the Inc. 5000 for a second year in a row in 2020 and appeared on the cover of the November issue of Business NH Magazine as the fastest growing company on the annual list of NH’s Top 100 Private Companies.
But, as anyone who invests in the stock markets know, fortunes can quickly rise and fall. This week the FTC filed its action in U.S. District OCourt in Maryland and the NH Bureau of Securities Regulation filed its action in NH alleging that RagingBull.com made false claims to customers, failed to disclose material information to its subscribers, and published false images.
The FTC and the Bureau also named RagingBull’s principals and owners Jason Bond (pictured, right) and Jeffrey Bishop (pictured, left) in the action. “RagingBull sells subscriptions for their online education services that the company claims to teach individuals how to trade stocks and options. However, the Bureau alleges that RagingBull operates as an unlicensed investment adviser. “They do this by alerting stock and option picks, via daily emails and text messages, livestreaming their trading accounts, and hosting training sessions. RagingBull encourages its subscribers to mirror trade the stocks and options alerts of the company’s traders,” the Bureau wrote in a press release.
The Bureau also alleged that subscribers are unaware that RagingBull traders “are entering trades before they send out stock and options alerts to its subscribers, allowing RagingBull traders to receive a better price” than subscribers would be able to achieve.
The Bureau also claims that RagingBull misled subscribers by creating the illusion that their traders earn millions in trading profits annually, are self-made millionaires, and have posted photos of themselves with a private jet when RagingBull does not own one. The Bureau states, based on its investigation, Bond is not a millionaire trader earning millions in trading profits annually and that, despite an image of Bond appearing to speak at Harvard University, he was not invited to do so.
“Although RagingBull bills itself as only an educational service, it’s all a facade in an attempt to circumvent state licensing requirements of an investment advisor,” stated Noah Abrahams, a staff attorney with the Bureau of Securities Regulation, in a press release. Abrahams added, “their marketing claims, which lure the general public to subscribe, just do not add up, and deceive the public.”
In its filing, the FTC states RagingBull buried in fine print at the bottom of its websites a disclaimer that they "do not verify the testimonials they use in advertising and do not track whether consumers who purchase their services make any money at all, much less the kinds of returns advertised. Numerous consumers have purchased Defendants' programs and found Defendants’ claims to be false."
The FTC states the majority of consumers "do not beat the market or make the kinds of returns advertised. Many consumers have lost substantial sums of money in the stock market following Defendant’s strategy or trade recommendations; some consumers have even lost tens of thousands of dollars on just a few trades. When consumers try to cancel their subscriptions, many find they cannot do so easily."
The FTC also accuses RagingBull of profiting off the COVID-19 pandemicby "aggressively marketing their products while touting the success of their so-called COVID-19 and pandemic 'plays' in a market they say is 'creating more money making opportunities than we’ve seen in over a decade.'"
The FTC is seeking to obtain temporary, preliminary, and permanent injunctive relief, rescission or reformation of contracts, restitution, the refund of monies paid, disgorgement of ill-gotten monies, and other equitable relief. The Bureau is seeking an immediate cease and desist, administrative fines of up to $2,500 for each violation, restitution, and barring RagingBull from securities licensure.
A spokesperson for RagingBull denied the allegations but would not offer further comment.
In its complaint, the Bureau stated it has received “multiple complaints” about RagingBull’s trading services and it is also aware of more than 200 complaints with the Better Business Bureau. “The nature of the complaints vary; however, the main focus of the complaints is that the security picks by RagingBull traders are not profitable and subscriber requests for refunds based on dissatisfaction with the respective service are ignored or denied,” the Bureau states. “Subscribers also complain that the trade alerts are of no value as oftentimes the alerts are delayed causing the price to move out of a profitable range.”
However, while RagingBull is not accredited by the Better Business Bureau (BBB), BBB’s website shows the firm has a B rating and an average of 3.98 stars out of five with 44 customer reviews. The BBB reports RagingBull has 196 customer complaints with 149 of those closed in the past year.
A recent complaint in November asked for a refund based on false advertising. Raging Bull responded, “Our traders teach strategies they've refined over the years that work for them (and thousands of their subscribers). But that doesn't mean you're never going to lose with any strategy. We're very transparent with our results, even when our traders lose. Now, because members immediately benefit from the knowledge of the stats, analytics or from RagingBull.com, LLC, we do not give refunds. You should recognize that investing and trading is a marathon, not a sprint so every last piece of information that can help you learn along the way and give you ‘an edge’ over your competitors is worth investing in. We don't want you to follow our stocks, our stock alerts are for you to watch what our gurus are doing and how they are doing it. We want you to find the true value in the education we are providing you to help you achieve your goals. Regardless we're gladly here to talk with you and help you get back on the right track and are willing to give you three free months of Elite.”
Founded in 2010, RagingBull.com purports to bring together successful traders who share expertise through videos, blogs and newsletters as well as stories of their own successes and failures. Bishop and Bond market themselves as self-made millionaires who acquired their fortune through trading and who now teach others to navigate the stock market.
In an interview with Business NH Magazine in 2019, Bishop said he started the company in Dallas and has 20 years of trading experience. Bond had a 10-year teaching career but started using what he’d learned through RagingBull. He claimed he quadrupled his teaching salary in the first year. Then, Bishop tapped him to become a partner in RagingBull and apply his teaching skills in a new way.
In the 2020 profile, RagingBull stated it had more than doubled its staff to 154 employees, had five consecutive years of 100% revenue growth, an expanded portfolio of 30 products aimed at educating investors, and a new office in Baltimore. RagingBull claims more than 75,000 paid members and that nearly 1 million people receive its email. Bishop stated in the article he expects the firm will end the year exceeding $100 million in revenue. “Our goal is to be the Motley Fool of this generation,” he said.
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