The notes, often sold by insurance agents, are in fact very risky and often fraudulent.
Many victims are elderly.
Nationally, regulators in 27 states announced over 800 actions against over 500 individuals and entities. The cases, all brought in recent weeks and months, highlight what state regulators say is a serious and growing problem. In addition, the U.S. Securities and Exchange Commission announced 13 cases against marketers of promissory notes. Low interest rates are great for the economy but hard on people who rely on safe and predictable income from bank accounts, money market funds and dividends. Responding to complaints about promissory notes, securities regulators in 37 states and the District of Columbia1 formed a task force in May 1999.