everyone else hit it the nail dead on...
personally, i dont trust anything/anyone when it comes to money simply because i cant afford to.
i hate to imply this about your friend but seriously man...
ya cant fix stupid.
if he's too hard headed and stubborn to hear you then he's gonna have to deal with the consequences when they bite him in the butt, just dont let yourself get suckered into bailing him out when that happens cuz this has to be a lesson he needs to learn on his own if he's gonna put himself in this kind of situation.
the hardest thing your gonna have to do at that point when he comes crying for help is to put your hands up and say "sorry, i tried to tell you but you didnt listen."
he might hate you for it and you might lose him as a friend but honestly i think i'd rather lose a friend then let one drag me through their mess cuz they wouldnt listen to warnings and went and got themselves into trouble.
tough love sucks but it's neccessary for those who dont listen to reason.