Although it's still a far bigger scam than Bernie Madoff's $50 billion Ponzi scheme, it has gotten a relatively tiny amount of attention. I don't know why but I suspect it's because the victims of the $330 billion Auction Rate Securities (ARS) swindle -- in which money invested in supposedly cash-like investments in government bonds whose rates reset in weekly auctions -- are not bold-faced names like Kevin Bacon and Steven Spielberg.

Nevertheless, when the ARS scandal broke in February 2008, those investors found that their supposedly safe savings were frozen when the auctions to reset those rates stopped happening. My original post now has 7,343 comments from people who have been trying to get their money back. The good news is that some $200 billion worth of those securities have been unfrozen thanks to Massachusetts and New York officials, Bill Galvin and Andrew Cuomo, respectively, who fought on investors' behalf.

Nevertheless, there remain about $135 billion worth of these ARS that remain frozen. There are many individuals whose funds remain frozen with limited prospects of recovery. And there are companies and non-profits whose funds are still frozen as well. These include Vicor (NASDAQ: VICR) with $38 million of its funds tied up until 2010 at the earliest; Tufts Health Care has $30 million, which has half its cash tied up and no prospects for recovering it; and Five Star Quality Care (AMEX: FVE), with $75 million tied up in ARS and just just $39 million in cash.

This is the part of a series of columns called "The Naked Truth," by retirement expert Dan Solin. Please bring him your questions, in the comments box, and he will answer as many as he can.

William Galvin, the Secretary of the Commonwealth of Massachusetts, has sued UBS, accusing it of misleading retail investors to buy auction rate securities when it knew that the market for them was crashing.

The Complaint has a familiar ring to it. It alleges that UBS favored its institutional clients over its retail clients (big surprise!), urging its retail clients to buy these securities when its institutional clients were selling them. UBS sold these securities by representing to its retail clients that they were safe, liquid and secure--the equivalent of cash.

Among the duped investors was a seventy-eight year old retiree who was told that these securities had a "7 day liquidity." He is still waiting.