A few weeks ago I talked about Getting Advice. How sometimes you look towards friends and family for advice on investments, but you really need to do your own research. It’s how a lot of people got caught up in a Ponzi Scheme by Bernie Madoff.  They listened to investment advice without researching.

Another easy financial mistake is finding interest rates too good to be true!  What do I mean? Well last week the SEC released a statement telling people to beware of a Ponzi scheme by a Caribbean based bank called Millenium Bank, which was selling high yield Certificates of Deposit.

Typically people reasearch the highest yielding CD and think it’s FDIC guaranteed.  In this case, the Millenium Bank waws not FDIC insured, but was offering rates of 6-8% on one year CDs.  Apparently these rates could be found when searching the web for the highest CD rates available.   Unless you were skeptical of such rates and investigated further, you might have easily been sucked into thinking you got a great deal.

Thus a word of caution on returns too good to be true for investments, probably are fake.