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POSTED ON BY Ken Tumin
An investigation of the suspicious website, Federal Savings, was described in this Bankrate.com article. Here's how it summarized its findings:
It's interesting to note that this site recently changed its "certificate deal" from a 8.85% yield to a 6.25% yield which makes it sound more believable.
Just like my post from last week, the Bankrate article provides links to the FDIC and NCUA database. If you're looking for a CD or savings account, I highly recommend you stay with federally insured banks or credit unions. In that post I describe how you can confirm a website is connected to a federally insured institution. In most all my posts on deals, I provide a link to the FDIC or NCUA page with the information on the institution. If you're willing to take some risk for a potentially higher yield, I recommend sticking with the major brokerages like Fidelity, Vanguard, ETrade, etc.
without an extensive investigation there's no way for us to say whether Federal Savings's offer was legitimate. What we can say is that there are many signs pointing to potential problems and no answers to any questions.
It's interesting to note that this site recently changed its "certificate deal" from a 8.85% yield to a 6.25% yield which makes it sound more believable.
Just like my post from last week, the Bankrate article provides links to the FDIC and NCUA database. If you're looking for a CD or savings account, I highly recommend you stay with federally insured banks or credit unions. In that post I describe how you can confirm a website is connected to a federally insured institution. In most all my posts on deals, I provide a link to the FDIC or NCUA page with the information on the institution. If you're willing to take some risk for a potentially higher yield, I recommend sticking with the major brokerages like Fidelity, Vanguard, ETrade, etc.
However, compared to other programs that come and go in a matter of days (your HYIP's for example), this looks much more harmless. No FDIC coverage means you have to accept the risk of not being insured if the company goes under. Considering the number of investment vehicles out there that are not insured (mutual funds, for one), this shouldn't be unfamiliar territory for your average investor.
The true test will be if people start being paid on certificates that reach maturity. If Federal Savings is still around in six months, you can probably lower the alert level from orange to yellow ;)
They appear to be at the top of the sponsored links for several google searches, so someone's got some money to spend here. That 'boat dock' mentioned above is actually some of Seattle's most expensive commercial waterfront property.
Do you realize that up to a few hours ago Federal Savings was running ads on this web site?