The investment entity Cash Plus has driven Jamaican investors into a paroxysm of frenzy with people queuing up with their hard-earned Jamaican dollars in the hope of making a 10 per cent return per month.

Yes, the testimonials are very positive, indeed reassuring, but questions need answering. Who is the lead principal of Cash Plus? What are his antecedents? What does Cash Plus invest in? Just how safe is investors' money? What is likely to happen if you should demand your money tomorrow?

It is of paramount importance that one knows who one is investing with and whether that organisation is credible and well established. Are the lead principals upstanding citizens or are they charlatans, carpetbaggers and get-quick-rich artists?

Speaking with investors in Cash Plus, it was patently clear that there were many who were unconcerned about who they were investing with, the character of the persons involved and just how they are able to make those cheques every month.

As far as Caribbean Business Report understands, the lead principal is one Carlos Hill, a former mortgage broker from an unknown company. Little is known about his educational achievements and professional career.

Cash Plus was founded in 2002 and comprises a diverse range of interests including real estate, telecommunications, entertainment, gaming and phone cards. The idea is that investors or rather punters stump up a minimum of J$100,000 and make a 10 per cent return a month. The model has certainly caught the attention of the investing public who are now pulling their savings from the traditional finance houses in the hope of making "a bag-o-money from the new money-makers".  Investors appear blithely unconcerned about what they are putting their money into, which speaks to the unsophisticated nature of Jamaican investors.

The fact is that with the Jamaican dollar devaluing daily, and a general election due some time this year, investors are likely to become skittish and may well form a run on Cash Plus. Can Hill honour all his commitments, considering he is taking short-term deposits and investing in assets that generally are tailored to a long-term return? This may well be weighing on his mind, as now Cash Plus insists that your money has to be with the "institution" for a minimum of three months.

Cash Plus or Hill has invested in a housing development scheme in Sunset, Cherry Gardens. The units are going for about US$1 million which, bearing in mind the perilous nature of the terrain they sit on, might not get many takers at that price.

Phone cards have exploded in Jamaica and taken on currency-like status. Cash Plus has taken a heavy position here, but is it sustainable and how quickly can it turn vast profits to pay out to its clients? Caribbean Business Report understands that phone card sub-distributors earn between half a per cent and one per cent. The retailer earns between 7 and 8.5 per cent but is not the end user. Now considering that Cash Plus was not recognised as one of Digicel's top five producers, just how many cards does it sell a month? If it sold 100 million cards a month, that would spell J$1 million a month in revenue, hardly enough to sate the appetite of its growing client base.

Cash Plus has become inextricably linked with OLINT and many people think they plough the same field. This is a heinous misconception. OLINT, headed by David Smith, is a foreign currency-trading company. Over the last year he has earned the reputation as an exceptional trader. His antecedents are well known - the son of outstanding teachers who cut his teeth at both the Bank of Jamaica and JMMB before setting up shop for himself in a business he is well versed in. He is no dilettante.

In March of last year there was a run on OLINT with it losing 70 per cent of its deposits but it was able to make its payments and has remained viable without any new customers (There is a cease and desist order in place until next month) since November of last year. This speaks to its liquidity.

OLINT has managed to attract a more discerning clientele largely as a result of making returns in US dollars and those who acknowledge Smith's prowess. It is said that he has almost half a billion US dollars in funds under management making him a force to be reckoned with.

Some very reputable players in the financial sector have taken some stick for saying that the high earning returns from these new operations are unsustainable and the height of folly. Michael Lee Chin has said that the best investor in the world, Warren Buffett gives a return of 20 per cent a year, with Lee Chin's own Advantage Fund paying out a maximum of 14 per cent. JMMB has been quick to peruse the landscape and Julian Mair has come up with some innovative products, which are enticing.

Some have said that those who have voiced their scepticism of these high returns are just envious and it's a case of sour grapes. I'd like to think that many of them who are good bankers fear for the small Jamaican investor who cannot sustain shocks. These men are cautioning prudence and advising that investors should make informed decisions before parting with their cash. A Charge of the Light Brigade mentality is not a sound framework to make investment decisions.

Both the minister of finance Omar Davies and the executive director of the Financial Services Commission (FSC), Brian Wynter have warned Jamaicans about investing in dodgy schemes, but their warnings have gone unheeded. They remember only too well the fallout from FINSAC and people begging to be saved. The sector has over the last five or six years staged a recovery and there are those who would like the country to remember well those foreboding days. If dodgy schemes were to take a hold of the investor consciousness and fail, it will be the state that will be expected again to bail them out. The pleas of "Why didn't you warn us? You should have protected us," will be everywhere. These men have a difficult job of creating an environment where investors have a choice and are not inhibited by over-regulation while at the same time having a duty to protect the gullible investor from shady schemes and dubious companies. This may go some way to explain their reticence.