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WHAT CAMS IS NOT By now most everyone has heard the term, "Ponzi Scheme." A Ponzi Scheme occurs when someone takes possession of money belonging to others and steals or "borrows" it for personal use while using new deposits promised "distributions" to prior investors. Such accounts usually promise regular and higher than reasonably normal income distributions, thus tapping the greed factor to generate a high level of participation, normally in the millions or billions of dollars. Others are often involved in the acquisition of new money and therefore sweep "compensation" off the top before the new money even reaches the proposed investment activity. It's only a matter of time before the income distribution drain on the account reduces the account balance to zero, but not before the creator of the Ponzi Scheme removes the cash he wants for his non-investment expenditures. Real estate, yachts, jewelry, private jets, discrete offshore accounts anywhere in the world and otherwise lavish living are the typical destinations for such "evil" money. Shortly after the promised distributions dry up, either over time or when investors innocently begin to request withdrawals or redemptions of their original deposits, everything hits the fan because no more payments can be made. That leads to formal complaints to State regulators, attorneys and maybe the FBI and/or SEC. After a diligent investigation, if evidence creates the stench of a Ponzi Scheme (or other illegal activity), the perpetrator is eventually found and arrested and charged. The ingredients of a successful Ponzi Scheme (always temporary) usually include 1. a well-positioned, male investment guru, 2. a too good to be true investment story, 3. a sole individual who controls the movement of all money, and 4. a sole individual who has ongoing access to all money without accountability.
IN STARK CONTRAST A CAMS account is NOT A PONZI SCHEME. An account with CAMS as its manager is placed with a national brokerage firm and the money is held separately from all other accounts and separately from the corporate funds of the brokerage firm. The CAMS manager will initiate client-understood and authorized fee deductions from each separate account, but any other money that move out of an account MUST go directly to the individual client, either by check or by direct deposit into a designated client bank account. The CAMS manager does cause money to be moved within each account for the purpose of buying and selling assorted securities, but he cannot remove money FROM the account beyond his approved fees. With that said, CAMS cannot remove money from an account for any reason. The CAMS client has instant access to account value and activity by calling the brokerage firm, online viewing and by communication directly with the CAMS manager. CAMS operates under full and ongoing accountability to clients. Growing account values provides CAMS with complete motivation to do well for every client. CAMS compensation is conditioned upon a client leaving money in the account. If a client should become dissatisfied, that client can remove every dime from a CAMS-managed account on any day he or she chooses. A client can also STOP all trading activity within an account, pending further consultation with the CAMS manager. The POINT: Except for the actual trading operations, the client retains full access to and authority over the money in the account. The client simply delegates investment decisions to CAMS until further notice. It is physically impossible for the CAMS manager to take any or all of the money and run away to another country! The money is safe in that regard. There is always investment risk to be understood and managed, but you can't be in the market at all without accepting investment risk. If any question at all arises in your mind about how money moves in and out of a CAMS-managed account, just ask.
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