That is a, a very disgusting thing, but unfortunately, it’s not uncommon.
[00:00:17] Michelle: Welcome back to AARP’s The Perfect Scam.
I’m your host, Michelle Kosinski.
This week we delve deeper into a scam we started to explore last week.
If you haven’t listened yet, you’ll want to.
Doc Gallagher seemed to be the most attentive, God-fearing personalized financial advisor around.
Now, let’s meet some new characters and see where this all ends up.
Starting with Larry Burdine.
The last job I had was with a multi-national telecom company called Alcatel/Lucent.
[00:01:40] Michelle: It doesn’t get much more Texan than you, I think, Larry.
[00:01:57] Michelle: Perfect.
(chuckles) That helps set the scene.
[00:02:47] (clip of Senior Follies)
[00:02:53] Michelle: It’s for charity.
[00:03:02] Larry Burdine: Of course, I was intrigued.
[00:03:25] Michelle: Yeah.
[00:03:35] Larry Burdine: Yeah, uh I was very hesitant.
Annuities are very similar to that.
[00:03:56] Michelle: He first heard about Doc’s products about three years ago.
[00:04:09] Larry Burdine: She really uh wasn’t very warm toward his uh, BS.
[00:04:16] Michelle: The guys are okay enough with Doc, but the ladies seem universally suspicious.
I think we’re onto something here about the female intuition.
People are more important than profits.
Larry finds that others in his circle all have only positive things to say about Doc’s investment skills.
[00:04:48] Michelle: So your mother-in-law actually was the first to invest with him in your family.
How did that happen?
Or did you use her as the test case?
You’re like, well, I’m not sure, how about the mother-in-law?
Let’s let her try him out first.
[00:05:01] Larry Burdine: Laugh as you wish.
That’s exactly what we did.
[00:05:05] Michelle: Oh, no.
[00:05:10] Michelle: Oh.
[00:05:38] Michelle: Yeah.
Money definitely helps with that.
[00:05:48] Michelle: Yeah.
But he was a blowhard who knew how to invest, I guess.
[00:05:52] Larry Burdine: Yeah, yeah.
[00:05:54] Michelle: Larry, though, still wants to do a little more looking into Doc.
It seems to check out.
[00:06:09] Michelle: No red flags or anything?
[00:06:11] Larry Burdine: Nope.
[00:06:12] Michelle: Then one day, about two years ago, Larry starts experiencing heart problems.
He goes to the hospital and it’s worse than he expected.
[00:06:30] Larry Burdine: Doc shows up, sort of unexpected.
And uh…
[00:06:34] Michelle: Not the Doc you were hoping for.
[00:06:37] Larry Burdine: Yeah, right.
Uh, then he left.
And, you know, about two weeks later I moved my IRA over to him.
[00:07:23] Michelle: Yeah.
So that was a real turning point.
[00:07:26] Larry Burdine: Yeah.
Immediately they get a 612 percent bonus for acting so quickly.
There was just one thing nagging at Larry.
He didn’t take the time to hug me.
[00:08:16] Michelle: Huh.
Doc was one of the speakers.
[00:08:34] Charles: He liked being the center of attention, I’ll put it that way.
Liked to be noticed.
Charles gets a letter from Doc.
[00:09:07] Michelle: Uh-oh.
[00:09:08] Charles: Yep.
[00:09:17] Charles: Yeah, was his way.
His wife had been diagnosed with Alzheimer’s Disease a few years earlier.
[00:09:29] Charles: We were always savers, and we lived a pretty simple lifestyle.
She took care of her parents for years.
We, we were comfortable.
[00:09:50] Michelle: They had a six-figure savings they never expected to spend.
They couldn’t travel, but knew Charles’s wife might need nursing home care.
They just wanted someone to help them manage finances for this next stage.
And maybe that ultimately donate their savings to charity.
Well, right then I, I knew I wasn’t going to send any more money.
[00:10:51] Michelle: You were kind of like, okay.
That’s it for this guy.
[00:10:55] Charles: Yeah.
[00:11:17] Charles: Yeah.
(chuckles) He was not a writer.
[00:11:24] Michelle: I think there were a lot of things he wasn’t.
They had just spent a beautiful day.
This was the time of their lives.
A frantic phone call comes at night from his mother-in-law.
[00:12:00] Larry Burdine: She was okay until the Feds showed up.
[00:12:02] Michelle: Doc Gallagher was in jail, accused of fraud.
[00:12:07] Larry Burdine: She was upset.
[00:12:09] Michelle: Yeah.
[00:12:15] Michelle: Oh… gosh.
[00:12:43] Michelle: This was Doc, after all.
The guy everybody knew, who’d come to your house, send you a birthday card.
The guy who would quote scripture and say that God sent him to help.
There’s got to be a mistake.
[00:13:10] Margaret: It was a terrible day.
And uh, we experienced all the different emotions of grief for quite some time after.
Disbelief, sadness, anger, questioning ourselves.
[00:13:45] Michelle: Yeah.
[00:13:46] Harold: Doc wanted, uh, he wanted attention.
[00:14:36] This is something that, you know, happened over a period of years.
She’s particularly disgusted by this.
I am here for you.
I am more than your financial advisor.
I’m going to take care of you.
No one we spoke to had any idea that Doc had no investor’s license, which is illegal.
Just in January of last year alone, he raised a half a million dollars from victims.
When he was arrested, the total cash he had in the bank was just over 800,000.
[00:17:26] Alexis Goldate: He wasn’t super flashy.
And it was the thrill of the taking, the, you know, it fed his ego.
And he was exactly the opposite of what he said he was.
And they don’t like my style, they don’t like what I’m doing.
He always felt there was something rotting inside The Money Doctor’s bag of tricks.
[00:20:39] Michelle: What was it?
[00:20:39] Dave Lieber: I just had suspicion.
He was a master marketer, and he was doing things that no other financial advisor was doing.
And I mean it was just all too good to be true.
He, he’d send you gift cards, uh to his clients.
But he was the opposite.
[00:21:17] Dave Lieber: This headline, “Why are these leaders talking to Doc Gallagher?”
[00:21:38] Michelle: All part of Doc’s big Texas persona.
He had great eyes, he had a great smile, he had a great voice.
He was just one of the most charismatic people you’d ever, you’d ever meet.
[00:21:59] Dave Lieber: That’s right.
It was really a failure of the regulators here.
[00:22:36] Michelle: Yeah.
[00:22:37] Dave Lieber: Millions and millions of dollars later.
I mean, that’s, that’s crazy.
[00:23:15] Dave Lieber: In a book.
[00:23:17] Michelle: Exactly.
[00:24:01] Dave Lieber: He targeted the sick.
It’s terrible, because I remember when I interviewed her, you know, she cried.
It’s left a trail of devastation the way a tornado would.
In reality, he had preyed on them.
That, that is a, a very disgusting thing but unfortunately, it’s not uncommon.
Another thing I learned about him, was, you know, he wrote a letter to Susan Pippy.
[00:25:11] Michelle: Yeah.
I look forward to seeing you – Doc."
[00:25:25] Michelle: Today, Doc Gallagher has this to contemplate in state prison.
He pled guilty, got 25 years.
He’ll be eligible for parole in less than 6, aged 85 or so.
So many lives turned upside down by one man’s vast fraud.
Let’s hear from some of our characters.
And Michelle, he knew his audience, and he spoke their language and played into their comfort zone.
I mean I literally hugged that man a couple times.
And I, and I’m not a person that even hugs my own family.
We’re not huggers.
[00:27:27] He took part of my future.
I don’t know whether I will ever forgive him.
I don’t, I don’t feel the least bit like forgiving him.
[00:27:57] For a very warm-hearted person that he appeared, he’s just ice cold.
Fortunately, I didn’t invest everything.
I didn’t invest money that I ever intended to spend.
[00:28:08] Michelle: Well, good for you.
I’m happy to hear that.
And I’m also very sad to hear that Jesus is like the worst money manager ever.
[00:28:16] (laugh) Yeah.
And uh, you know, I tried to adopt a forgiving nature toward Doc.
I, that’s what the, that’s what we’re supposed to give, forgive folks.
[00:28:41] Michelle: I love it.
I think that’s the best advice I’ve heard, Charles.
So…
[00:28:54] Charles: Yeah, I hope so.
[00:28:54] Michelle: Thank you so much.
[00:30:09] Michelle: What makes it hard to see?
[00:30:41] Michelle: Got it.
Do it on a regular basis.
Everything’s been fine with me."
[00:32:40] Gerri Walsh: The power of your friends is immense.
It is immense, and you cannot underestimate it.
It’s actually called the social consensus tactic.
It must be okay.
I’m not going to check out this person, because my pastor uses this person.
But you have to remember that whatever’s right for someone else, might not be right for you.
It’s always a good idea to check out somebody and verify that you’ve independently researched them.
It’s hard to go against that tide.
That’s actually another tactic that cons use, it’s called the source credibility tactic.
You might never think that that’s a red flag.
It’s because the fraudster spent an enormous amount of time and energy making their scheme look real.
The reality is, if something is too good to be true, youre probably dealing with an amateur.
[00:35:51] Gerri Walsh: Thanks for having me.
Be sure to find us on Apple Podcasts, Spotify, or wherever you listen to podcasts.
For AARP’s The Perfect Scam, I’m Michelle Kosinski.
Known as theMoney Doctor,Gallagher handles investments for members of his close-knit Christian community in Dallas.
Gallagher is perpetuating a Ponzi scheme.
