References are far from useless. It's like interviewing: if you let the candidate give you fluffy BS answers you'll get snowed every time.

Listen carefully and dig deep. Don't just settle for "I know this guy and he made me a bunch of money." Ask the reference what the guy did to make money, what was his plan, how they met, why he decided to work with him, why they aren't working together any more.

Imagine you're sitting down for lunch with the reference and having a conversation about the person he's referring and you'll do a better job of understanding what he's all about.