FINRA Issues Investor Alert Regarding High-Yield CDs

FINRA issued an investor alert, titled "High-Yield CDs: Red Flags That Signal a Scam," that warns investors to be wary of promotions advertising certificates of deposit ("CDs") that promise "substantially higher" interest rates than current averages.

The alert enumerates flags that could signal a scam, including:

• interest rates that are significantly higher than average;
• promotions that claim to be from a U.S. financial institution that has aligned with an international bank;
• emails with addresses that do not originate from and were not sent by the financial institution that is cited in the promotion, and which contain misspellings or grammatical errors; and
• promotions that claim to be for a "limited time only," are directed at "best customers" and require extremely high minimum investments.

In the alert, FINRA recommended that persons should never provide personal information or authorize any transfers of funds to any unknown person.

See:FINRA Investor Alert: High-Yield CDs: Red Flags That Signal a Scam.