Millennium Bank in Caribbean: Ponzi Scheme Shut down by SEC

I first saw this last night (burning the midnight oil for you :O) ) on bankdeals.

Many of our readers and visitors over the years have asked about Millennium Bank and I have always urged great caution. It is alledged that “only” $68 Million is in question. Although that pales in comparison to the Allen Stanford and Bernie Madoff fiascos, real people have been hurt. The question begs, why did it take so long? Certainly, questions have surround this bank for a number of years.

The old adage of “if it is too good to be true…” certainly came into play here. If you are investing in CDs because of their safety and guarantee, then stick with FDIC insured banks and NCUA insured credit unions. If your looking for higher rates of return, then look to the markets. It is just too risky, otherwise.

Bloomberg also has a story on this.

Also, please don’t confuse this Millennium Bank with any of the FDIC insured ones that reside here in the states. The following are FDIC insured banks:

• Millennium BCP Bank, NA (35280)-Newark, NJ
• Millennium Bank, NA (35096)-Reston, VA
• Millennium Bank (57175)-Edwards, CO
• New Millennium Bank (35151)-New Brunswick, NJ

Thoughts on AIG

I would encourage everyone to read the linked article. Michael Lewis lays it out and provides us insight into why we should fear the Gov’t being able to modify contracts. I’m as outraged as the next person, but the problem is not the bonuses. The problem is allowing a company to continue way past its expiration date. Let me know what you think of the article.

Mass Hysteria Over AIG Obscures Simple Truths: Michael Lewis

Looking for the best CD Rates – Introducing MoneyAisle

While searching for the best rates for you guys, I came across MoneyAisle awhile back. After some talks back and forth I felt comfortable with their service. You’ve probably seen their ad on our rates page. They offered to write an introduction piece for us, their blogger, Kevin Cafferty, provide the below information. They have competitive rates. I ran an auction today and a 2.50% APY was the top rate. That is in the top 10 rates that we are seeing. So enough of me, here is Kevin. Please leave any questions in the comments, I’m sure we can get Kevin to come over and respond.

Looking for the best CD Rates?
Recent market volatility has made safe investments like certificates of deposit more attractive to consumers looking to get a steady return on their savings. Rates between different financial institutions may vary to the point where it’s difficult to find out if you’re getting the most out of your cash.

The Solution: MoneyAisle
MoneyAisle takes guesswork and time-consuming comparison shopping out of the equation by providing you with great rates, free of charge. Over 100 banks in the MoneyAisle network all want to acquire you as a depositor and are willing to bid against each other in a live instant auction for that privilege.

Here’s how it works: you enter the terms of your CD (deposit amount and duration) into MoneyAisle and then watch the banks battle it out in a live automated auction – the winning rate at the end of the auction is the highest rate available in MoneyAisle’s system at that time. You’ll be presented with comparison rates on a national and state level to give you a sense of what your return will be and you’ll be provided with information on the bank.

It’s free, and you don’t have to commit until you’ve gone over all the information. The entire auction process only takes a few minutes, every bank in the network is a member of the FDIC, and the banks have been further pre-screened using an independent bank rating agency for additional consumer protection (banks rated in danger of failing are not in the network.)

Northeast Community Bank — 1Y at 2.79% APY

Okay, a true freebie for you. My last attempt didn’t fare so well, so no strings attached. The CD Rates are decent.

Northeast Community Bank — FDIC# 29147.
1-year CD at 2.79% APY
18-month CD at 3.05% APY

Their stats look healthy and the rating system we use gives them 5-stars.

They need a copy of your driver’s license and a second form of ID sent in the mail after the on-line process is completed.

Visit their website. Click the open Your NECB account link. The rate isn’t locked in, until they receive the funds.

Let me know how it goes. I also came across this site with some good money advice.

cd :O)

Will IndyMac Return From the Brink?

In a story on Yahoo today, it is being reported that the Gov’t is in talks to return IndyMac to private ownership.

Many are touting this as a blue-print of succes for potential Nationalization with future banks. Of course the stockholders that were wiped out when the Gov’t took over the bank may disagree and the folks who had uninsured funds would certainly not agree. Another key difference is the size of the bank. IndyMac was about $40 Billion in assets when it was seized. It is now about $23BB. Citibank is $1.2 Trillion dollars. Just a wee bit bigger. :O) Bank of America is a tad larger at $1.47 Trillion. Don’t you love decimals, they can make big numbers seem so innocent.

I honestly think they should break up Citibank and Bank of America. If the Gov’t is of the mindset that they are too big to fail, they shouldn’t be able to get that big. I detest too much Gov’t intervention, but they are already way beyond that. They should set a limit on the size and footprint a bank should have. If banks want to maintain a large ATM network, partner with other banks. That is what credit unions do.

Allow some regional or community banks to purchase branches, assets, and deposits of Citbank or Bank of America that are in their area. I bet service would actually improve. Probably rates, too.

Yahoo also carried another story on whether the FDIC can handle all of the bank failures that will most likely happen throughout this year and into next year. The headline of course was an attention grabber and meant to cause fear. But the underlying story was about the efforts the FDIC is taking to shore up the insurance fund. They are assesing a 20 Basis Point or 0.20% premimum on banks insured deposits. So for every $1000 a bank has on deposit, $2 is being paid to the FDIC. That’s pretty significant. However, at least they are trying to be proactive. They also have facilities to borrow up to $500BB. Just turn the printing presses on. I don’t think you have to worry about not being paid back if a bank fails. I do worry about the future tax burden that will be put on our children, grandchildren, and great grandchildren.

There isn’t much other good news in the financial world or any other part for that matter. How about a quote?

You can shower a child with presents or money, but what do they really mean, compared to the more valuable gift of all — your time? Vacations and special events are nice but so often, the best moments are the spontaneous ones. Being there. Every moment you spend with your child could be the one that really matters. — Tim Russert (Host of NBC’s Meet the Press and author of Wisdom of our Fathers.

What are your thoughts?
cd :O)