You dont even have to know anything about business to know that your money manager should only have authorization to trade your account, not the actual custody of your funds. That way you get a statement every month from the custodian, whether it is Schwab, Fidelity, whoever and stuff like this cant happen.
This seems so obvious. Then throw in the outrageous jackets and a little folksy charm and people go crazy with their money. It's almost as bad as the old Nigerian money expatriating scams.