The Five Dumbest Things on Wall Street

1. Herbalife's Diploma Debacle

In his zeal to offer premiere meal-replacement shakes and herbal supplements that defend against the vicissitudes of snacking, Herbalife (HLF Quote) Chief Operating Officer Gregory Probert has let a big fib get away from him: He never completed his MBA from California State University, Los Angeles, even though his resume claimed he did. On top of that, Herbalife claimed that Probert had earned the degree -- in as many as 19 filings with the Securities and Exchange Commission.

"The truth is that my vanity prevailed and I did not take action ... even though I was aware it was not accurate," said Probert.

"I suppose that some of us who have been blessed with a certain degree of good fortune are tempted to see the paths we took in romantic vs. strictly factual ways," Probert told The Wall Street Journal. "I was wrong for succumbing to my vanity and apologize for doing so."

Probert resigned Thursday after the board reviewed his exaggerated credentials, saying it couldn't keep him on "given the company's unwavering commitment to the highest standards in business ethics."

That a company honcho would lie about a diploma is perhaps not shocking in itself -- higher-ups at Mylan(MYL Quote) and RadioShack(RSH Quote) have faced the third degree about their credentials. And besides, when it comes to running a multibillion-dollar company, what's one piece of university paper, more or less?

Perhaps Probert thought no one would notice.

He should have known better, especially given the corporate policeman that exposed him. The revelation comes thanks in part to the efforts of Barry Minkow, former jailbird and current Christian pastor/fraud exposer. Minkow had hired a private investigator as part of his ongoing effort to discredit Herbalife.

After serving seven years in the 1990s for check-kiting and other hijinks related to his spotty ZZZZ Best carpet-cleaning/insurance restoration/fraud company, Minkow cleaned up his act, found God and co-founded the Fraud Discovery Institute.

Dedicated to investigating only "companies ... that are currently NOT being investigated by law enforcement," the Institute's distinctly Web 1.0 site derides the "Herba-Lie." Elsewhere, the Institute urgently proclaims that "First and foremost, fraud detection and prevention is more than a state of mind."

We'd say so. Minkow owns Herbalife puts.

Dumb-o-meter score: 88. "Having you on our side is one unknown variable no perpetrator could have planned for," gushes an attorney to Minkow on his efforts in a separate fraud case.