Con Men's Prime Bank Note Scams on Upswing

--Playing on letter of credit / prime bank note confusion, con men rake off huge profits.

Magalia, California--A departure from letter of credit fraud has been the recent emergence of prime bank note fraud, mostly emanating from Europe, aimed at defrauding Americans, now facing an F.B.I. crackdown. This scam is considered a step up because it requires strict noncircumvention agreements, which impedes the mark's ability to adequately, independently verify information about the investment. Often a tough wrap-around is a nondisclosure agreement.

What advantages exist for con men? Here are some:

Complexity. This always attracts con men, who, scam fighters say, consider themselves mentally superior. And, prime bank notes give them a show-case stage setting from which to demonstrate this.

Prestige. Foreign exchange instruments are always a great lure--for vanity appeal alone.

Easy to apply faulty logic. Because foreign exchange is shrouded in the mysterious, con men have largely a free hand to befuddle the whole issue as to its process and implementation.

Foreign banks use bank guarantees the same way U.S. banks use letters of credit: to insure payment for goods in international trade. Like letters of credit, these are never traded or sold on any kind of market. Knowledge of this non-liquidity has crept out over recent years. Not so for foreign bank guarantees. Victims are still for the most part in the dark about these.

"This scam is a dream for con men who want to shoot big, with a really cleverly concocted premise to peddle," says legal thriller author, Jack Payne. whose book, Six Hours Past Thursday, spells out many such cons. "The bait is that they have access to a block of these guarantees. By reselling them several times they claim to be able to earn a usurious return for the mark. For example, a $20,000,000 deal, turned over 10 times at 2% would produce a $4,000,000 profit."

Payne summarizes, "These large scale scams are whoppers now, and growing.
F.B.I. action against these is picking up.
Once the sucker bites, it's finger-snap clean, fast, and efficient for the con man. His money is speedily dispersed from the foreign bank, in which it was deposited, into an offshore account and washed. Once laundered, it quickly disappears into the pocket of the con artist for his high living pleasures."