Convicted Ponzi schemer Bernie Madoff who stole 50 billion dollars from unsuspecting victims may be the last person from whom you would accept investing advice, but in fact, his advice, as contained in a 2014 jailhouse interview Madoff gave to the Wall Street Journal is helpful to people hoping to avoid the fate of Madoff’s many victims. With great “chutzpah,” Madoff blamed his victims for their losses.  He said that his investors were “sophisticated people” who should have known better.  “People asked me all the time, how did I do it.  And I refused to tell them, and they still invested.  Things have to make sense to you.  You should ask good questions.”  About this he is correct. No one should ever invest in anything that they do not totally understand.

And this leads us to Artificial Intelligence (AI) which is a term describing sophisticated technologies that enables computers to comprehend and even learn similar to actual human intelligence.  AI can be used to create a wide variety of content such as writing stories or music that previously could only be done by humans.  It’s capabilities are constantly being touted in news stories and online posts.  Scammers are always alert to whatever is capturing the interest of the public and, in this case, scammers are already contacting people falsely claiming they have developed AI programs that can make investment decisions guaranteed to make large profits.  In particular, the scammers are tying their AI claims to investments involving cryptocurrencies which many people invest in, but don’t fully understand which is a dangerous combination.

Scammers have actually used AI to create YouTube videos touting cryptocurrency investments showing the CEO of the company persuading people to invest with his company.  In this case, however, the CEO doesn’t exist. His image and voice were merely creations of AI.

TIPS

The bottom line is that Bernie Madoff was right about one thing.  No one should ever invest in anything without totally understanding the investment and the inherent risks.  If you understand cryptocurrencies and still wish to invest  in them, that is fine, but all investment decisions should be made  only after being properly informed. You may want to check out the SEC’s investor education website at www.investor.gov.

Before investing with anyone, you should also investigate the person offering to sell you the investment with FINRA’s Central Registration Depository.  http://www.finra.org/industry/crd   This will tell you if the broker is licensed and if there have been disciplinary procedures against him or her.  You can also check with your own state’s securities regulation office for similar information.  Many investment advisers will not be required to register with the SEC, but are required to register with your individual state securities regulators.   You can find your state’s agency by going to the website of the North American Securities Administrators Association.http://www.nasaa.org/2709/how-to-check-out-your-broker-or-investment-adviser/

Here is a link to the SEC’s warning about possible problems you can encounter when investing in Bitcoins or other cryptocurrencies.
https://www.sec.gov/oiea/investor-alerts-bulletins/investoralertsia_bitcoin.html

Finally, YouTube is not the place to go to in order to find investments.