Don’t let a Ponzi scheme squash your savings
Back in 2009, Allen Stanford was arrested for running an $8 billion investment scam by selling high-yielding, but fake, CDs to safety-seeking investors.
These unwitting CD buyers lost their shirts when the operation was busted.
The SEC just announced that some of those investors will get their money back.
The SIPC, which is similar to the FDIC but for brokerages, would allow investors with these accounts to file claims with a designated trustee. The trustee then decides whether the investors have “customer” claims that are protected. An investor who disagreed with the trustee’s decision could seek a court review.
CDs are generally a steady, guaranteed investment, to a certain limit, making them appealing bait for scammers to use. If you see an offer for off-the-charts high CD rates, keep your checkbook closed and do your homework.