Prime Bank Notes or Prime Bank Investments are investments which claim “special access” to programs or investments that are reserved for banks or other top financial institutions. These types of investments are usually represented to be overseas and yield a high return in a short period with little or no risk. Only investors with the proper connections or financial net worth are told that they can participate. However, neither these investments nor the market described exist. Some promoters avoid using the term “Prime Bank” to evade the appearance of fraud.

Any investment offering high returns should be questioned. Investors should always question whether the returns promised are too good to be true and how such high returns are possible. Guaranteed high returns are a signature of Prime Bank fraud as well as offshore investments.

Once money has been wired offshore, it is difficult, if not impossible for funds to be repatriated. Most reasons for sending money offshore is to avoid taxes. This exacerbates the problem for victims who complain and hinders securities regulators in uncovering fraudulent schemes. There will often be tax implications for money sent offshore. Remember, once money leaves the hands of U.S. financial institutions, it is extreamly difficult to trace where the money has gone.

Promoters of Prime Bank and Offshore Investments claim “special access” and require that knowledge of this investment should be kept confidential. Investors will often be told that if asked, bank officials would deny knowledge of these kinds of investments. An investment is most likely a fraud when signing a non-disclosure or secrecy clause is required.

Investors should be very cautious any time a promoter describes an investment as exclusive, by invitation only, or only available to a few select individuals. This is often coupled with a sense of urgency to invest. If the investment is as successful as is claimed, why do they need your money and why won’t the opportunity be available tomorrow?

All investments offered in the State of Utah should be registered with the Utah Division of Securities or qualify for a state or federal exemption. Before investing please contact the Utah Division of Securities to confirm registration.

A promoter who seeks investor money for Prime Bank, Offshore, or similar investments must:

1. properly register under Utah’s Securities law;
2. file an exemption from registration under Utah law; or
3. file as a federal covered security, notice file in Utah.

In many cases, promoters fail to properly follow securities laws and offer unregistered securities to Utah investors, which is a violation of the law.

Many promoters fail to provide investors with adequate disclosure documents. Some will mislead or misrepresent the information and risks in their disclosure documents. Disclosure documents will rarely be provided for a Prime Bank or Offshore Investment. Omission or misrepresentation of material information in the offer or sale of a security is considered securities fraud.

If the underlying business of the offering is an investment fund whereby a fund manager makes investment decisions with the pooled monies, the manager is often required to license as an investment adviser. When a fund manager licenses as an investment adviser, additional information about the advisert can offer help to prospective investors seeking to research the fund. Licensing as an investment adviser also ensures that the manager’s fees will not exceed industry standards without proper disclosure.

Additionally, if a third party is compensated for introducing the issuer and investor, that third party needs to be licensed as an issuer-agent, broker-dealer agent, or investment adviser representative depending on the specific arrangements.

Investors are frequently told that these types of investments must be kept a secret. This will often frustrate efforts to prosecute violators and return monies to victims. The time period to bring actions against violators of the securities laws is limited. Contact an attorney and notify a securities regulator as soon as you become aware of any wrongdoing or concerns with your investment.