Prosper.com Review continued

Hello all,

Discussing with one of my friend and looking on the internet, It seems like the investment risk is pretty high for prosper.com.

Here are few articles which could help you guys resolve this too. Let me know if someone else has more thoughts on it.

Better Business Bureau Rating
As of December of 2009, the Better Business Bureau rates Prosper as a D+ with 43 filed complaints. [11]

Litigation
On November 26, 2008, a class action lawsuit was filed against Prosper in the Superior Court of California, County of San Francisco, California. The suit was brought on behalf of all loan note purchasers in Prosper's online lending platform from January 1, 2006 through October 14, 2008 and alleges that Prosper offered and sold unqualified and unregistered securities in violation of the California and federal securities laws. The lawsuit seeks class certification, damages, the right of rescission and the award of attorneys’ fees.

Source - http://en.wikipedia.org/wiki/Prosper_Marketplace

Although the website was launched again. I think its not mature yet. May be the strategy should be wait and watch. Ofcourse I am still wondering if there is a way to initiate this thing in a small community.

Here is one more read

http://www.thebigmoney.com/articles/money-trail/2010/01/18/you-are-unlikely-prosper

Excerpt from the article

"Prosper's data now shows that now shows that close to 36% of the loans made before Nov. 27, 2007—the date of the AP story—have ended in default, roughly thirteen times what a casual reader would have thought from Larsen's comments. That is close, coincidentally, to the total 39% (or roughly two in five) default for the Prosper loans that have reached the end of their three year term. (You can go here to see the data for yourself, just try plugging in the ending dates)."