1. Fund Companies Gouge Investors

More gouging for clueless investors: Yet another fund company has said it will tack a sales charge onto its mutual funds. In December, Credit Suisse Warburg Pincus Funds will start selling its funds through brokers in a bid to attract more assets.

The decision fits into a lamentable trend among fund companies adding sales charges to funds that previously had been sold directly. Others who've done it include Scudder, Strong and Invesco.

Sure, it's no surprise that fund marketers are out to rack up more sales, and working through brokers is an easy way to do that (especially for funds with lousy reputations, which are less likely to attract direct investments without outside intervention).

But that doesn't change the fact that load funds are almost always a rotten deal for investors. Legally, funds with loads are allowed to charge up to 8.5% of the initial investment in sales fees.

In effect, paying a load reduces the size of an initial investment. When you consider the effects of compounding, that lost money could add up to a whopping amount in foregone returns over time. And now more than ever, investors can't afford to give up one iota of potential yields.

2. Cipro Is No Savior for Bayer

A coda to the Cipro investment story, which we

argued earlier was unconvincing: Sure enough, a recent earnings report from



, the German chemical conglomerate that produces Cipro, shows that the company's other operational screwups more than outweighed the small gains it received from sales of the anti-anthrax drug.

For its latest quarter, Bayer reported a loss of 183 million euros, compared with a profit of 534 million euros a year ago.

The company acknowledged "substantial" extra business from Cipro shipments, including the U.S. government's order of 100 million tablets. But it said the additional sales were "nowhere near enough to compensate" for difficulties in other pharmaceutical lines, notably the damaging withdrawal of its cholesterol-lowering drug Lipobay/Baycal from the market in August after it was implicated in a number of deaths.

Bayer's stock, which had dropped in the wake of the terrorist attacks, rose sharply as anthrax cases hit the news. From its low point on Sept. 21, the stock jumped 37.3% to its peak on Oct. 12. Since then, with anthrax fears abating and the news of disappointing earnings, the stock has lost 8.3%.

3. Ken Lay, Playing It by the Book

You almost have to admire the gall of



CEO Kenneth Lay, who, in exchange for presiding over the company's brisk slide into mayhem, tried to slip out the door with a $60.6 million pay package.

He backed off that plan, according to press reports, on news that Enron employees were apoplectic about the deal. Some of them may lose their jobs in the merger with



, which came about after Enron's stock cratered on revelations about its fly-by-night accounting practices.

To be sure, Lay's employment agreement had provided for the payout if he left the company within 60 days of a change in control. We can only assume that at the time it was drawn up, the agreement's authors didn't see the need to mention that he should leave the company in one piece.

By the way, lest we convey the impression that Lay has acted cavalierly, he says he's put on his thinking cap lately. "As might be expected, this is a very reflective time for me," he said on a merger-related conference call this week. We're a little skeptical of that claim, given that he said in the same call, "We don't have anything to hide. Quite to the contrary, I think we've been very forthcoming." Enron is currently under investigation by the

Securities and Exchange Commission

; fleeing investors have bid the stock down about 90% from its high last fall.

4. A Blodget Blunder?

Speaking of folks who lost money for investors, analyst Henry Blodget is taking part in a buyout at

Merrill Lynch

, reportedly exiting the firm with a severance package of about $2 million. (



Blodget won notoriety for talking up the prospects of many Internet issues that later went belly-up or were acquired on the cheap, including such resounding losers as Pets.com, PSINet and uBid.

Last summer one irate investor, claiming he'd lost half a million dollars by taking Blodget's advice, extracted $400,000 in compensation from Merrill Lynch.

But despite the lousy stock calls, in retrospect Blodget looks pretty smart. He cultivated a momentarily outsized (if short-lived) cult of personality -- worth doing once during a lifetime, in our humble opinion -- and secured a tidy payout on the way out the door.

We note his exit from the scene not because he was dumb, but because his passage represents the end of an ignominiously silly era -- one in which ordinary investors tossed money into dubious ideas (like Pets.com), then were ungraceful enough to complain they'd gotten bad advice. There's no question analysts may have meted out absurdly bullish stock forecasts. The bigger problem is that investors, suckered by the potential of outlandish profits, acted like they believed them.

5. Unflagging American Opportunists

While we salute the unflagging American entrepreneurial spirit, we note that it also can metamorphose into enthusiastic fraud. Such was the case with three opportunists flagged by the SEC this week: companies claiming to have products that protect against bioterrorism.

Most inventive of the three was from

R-Tec Technologies


, which claimed to have developed a "Chemical and Biological Alarm and Neutralization Defense system," or in trumped-up military lingo, "C-BAND." The company said it's the first "mechanically-operated" (with a wind-up key in back?) system to protect citizens from such attacks.

R-Tec has admitted that it's never tested the device, doesn't have any plans to manufacture it and doesn't actually hold a patent on it. But it gets bonus fraud points for the cool acronym.

More straightforward scams were from

Disease Sciences



The Classica Group


, which said they had technology capable of killing anthrax in the mail. Disease Science touted its "High Pressure Pulse" processing, a fairly intensive-sounding application that, the SEC notes, it does not have a license to use. The Classica Group's alleged microwave technology likewise got a thumbs-down from the SEC.