What does it mean in Windows Vista when you get the little popup saying "This USB device could perform faster"?
Your device is plugged into a USB port running in USB 1.1 mode and thus is capped at 12Mbps. Find another port that does USB 2.0, or install USB drivers, to enable USB 2.0, which caps at 480Mbps.
Check your mobo driver CD or website for drivers.
As tsilb said, try other USB ports on your computer to see if you can find one doing full USB2. You can double-check Device Manager to make sure your system has a USB2.0 Controller device.
Some systems have front ports that only operate in USB1 mode, while their rear ports operate as USB2.
Finally, USB extension cables and port adapters can cause connection problems which might limit the speed of a device; try plugging the device directly in, with a high-quality cable, and no extension cables or adapters.