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Prime bank guarantee fraud

It refers to fraud involving bogus schemes of bank guarantees from prime financial organisations that promise to get quick riches in a short time. The criminals invite the victims to their schemes, and they offer quick, rich policies through bank guarantees offered at a discount, which you can sell quickly to gain a huge premium. 

They claim you can earn huge money through it, but the firm's offers will disappear once you part with your funds. 

How To Spot It?

They offer a plan and ask you not to discuss it with experts or friends. They claim they offer a lucrative deal to only a few investors invited to be part of the exhibitions and seminars. They even threaten the buyers with legal actions if they try to get independent advice from professionals. 

You are told the banks listed on the documents will not communicate unless you are the key investor. 

They provide complex statistics and information to make the plan appear highly sophisticated and claim "the funds would be secured" through a letter of credit often guaranteed by the endorsed bank. Alternatively, they provide some other kind of fraudulent certificate or legal authorisation to support their claims. 
•    They also give many documents to claim it is a risk-free offer sanctioned by globally acclaimed financial organisations.

How To Know You Are At Risk?

If you received an invitation and joined the scheme of bank guarantees.
•    If you bought in such a scheme at a discount, assume it is a low-risk sector.
•    If you are threatened not to get independent advice, you will be eliminated.
•    If you get official documents that have multiple spelling errors. 

 How To Protect Yourself?

There are no high-return, low-risk options like bank guarantees. Foreign banks offer such plans, but they never sell them for discounts, and they do not offer schemes for trade.

  • Always ensure the investments have reliable research and approved ways of functioning. 

  • You should ask questions if you are asked not to investigate or get independent advice. For example, ask who the firm's directors are, who the investors are, if it is registered, or if you can withdraw the amount early. 

  • Do not decide quickly, and do not be pressured to sign a contract at an event like an exhibition or a presentation.

  • Always ask questions about legal issues involved in offshore options and carefully investigate all aspects to ensure the offer is legitimate.

  • If you are a victim, report it to the regulatory authorities.

Date Published: Sep 14, 2023

Types of fraud

A-Z of fraud

To help understand which fraud you've been affected by, we've categorised them into an alphabetical list.

What is fraud and cyber crime?

Cybercrimes can be of two types. First, it can be cyber dependent, where the fraudsters use online devices to convince the victim to accept their offers.

Advance fee fraud

If you are trying to get a loan for a house or a car, they ask to meet the provider to get the financing arrangement and pay the finder's fee in advance.

Corporate fraud

Corporate frauds can be complicated, committed either by the firm or an individual. Nevertheless, it mostly involves cheating where the employee or the firm.

Individual fraud

There are many types of individual frauds related to advance fees, investments, insurance brokers, bogus tradespeople, Ponzi schemes, pension liberation.

Online fraud

Hence the number of cases of online fraud is increasing each year, and most such cases include – account takeover, direct frauds, or scams related domain names.

Identity fraud and identity theft

The criminal uses the stolen identity of another person living or deceased to conduct unlawful activities like obtaining goods or services in another's name.

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