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Financial Fraud of Different Types

A high caliber Investment Professional with an experience amounting over 30 years, majorly across various facets of Investment.

Simple Financial Frauds

Different Types of Financial Frauds

We are living in pandemic time, every one stressed. This crisis is very different. During this time, life came to stand still, this is first time in known history, that everything came to stop. It has increased bankruptcies and distressed. Another development is, it has increased fraud. All types of financial frauds are at rise.

I am trying to explain here different nature of frauds and how to save yourselves from it.

Simplest and Direct, these frauds are easy to Understand.

Inheritance – These frauds happens through email Someone contact you saying I am close relative of dead person he/she left so much of wealth, need to be invested, we can work together and can use this wealth. They are willing to share the money. Once you start communication with them they will ask for information and proof/documents to move forward. Once you gave them all documents, they will ask you small money to complete the transaction. This is how they cheat you. These are most common frauds. They can use your personal info and create fake identity also.

People in high power present or past – This is another fraud where you will get email saying, I am so and so. I have huge money for investment. I can invest in partnership with, let us work together and we can share everything. These are pure fraud, they will again all your documents and them ask you some money before they transfer money.

Direct Investment Funds – These are another fraud where more sophisticated methods are used to take your money.


Cash Frauds

They will send mail, ask for partnership investment. Once You start discussing with them, they will say we have Cash, we will deliver to you, once everything is agreed, they will tell you, pay some money to delivery guy. This is where they will take your money. The notes delivered to you will be either scraped, or fake notes. These are typical criminal gangs, organized crimes trying to use you to legalize their money. You will be asked to transfer money from your account to their accounting as instalment or profits.

This is Typically used by criminal gang’s. This is most dangerous and can cause you long term problem or you may be arrested for supporting criminals.

Never use unknown channels for getting quick money.

Be Safe

Important Fraud Information

Fraud and Fake Banking Documents

Check Fraud

Check Fraud

Fraud Work

Fraud Work

Structure of Finance

Structure of Finance

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MT 103 Fraud System

MT 103 Fraud System

RWA Fraud

RWA Fraud

Banking Instruments Fraud

Banking Instruments Frauds

Bank Transfer Cash MT103/202

This is another fraud, where companies are made to believe the money will be transferred and will be verified through sender. They will take discount on receipt and then money will be returned over period of time. Once things are agreed they will send a SWIFT copy, and ask you to go to bank, and request you to transfer you some money so that they can send you verification SWIFT and you can withdraw the money.

Once you transferred the money, there is no reply.

There are different types of Money Transfer Frauds, almost all modus operandi are same. Once you transfer the money, there will stop responding.

Manual Download

Manual Download - MT code is transferred and requested for manual transfer. They say we will send you code one by one, once Bank starts working on it, suddenly, it will stop responding. You will remain vulnerable to Central Bank Investigation for Fraud and Money laundering.

These are more sophisticated methods of frauds and these instruments are used to defraud you of your money.

There are different terminologies are used. These frauds are done through agents and supporters; they do not send you any email. They are very professional in doing these frauds. Many times people with Finance understanding fall prey to such frauds.

Bank Certified Check

These are checks, usually they say they will give debt, 5 to 7 years, ask you to pay less than 1% of value as upfront fees. Once you pay fees, they will send you photocopy of check and will tell you money is coming. But the check will never arrive. These are issued through known companies and known peoples. These checks are called certified check and will be cleared at local bank clearance once you send them for clearance. These are claims. But check will never arrive.

Big and known banks are used to defraud the people.

Understanding Banking Channels and directly verifying such things through banks can save you from fraud.

Bank Guarantee Frauds

SBLC and BG Fraud

SBLC/BG – These are most commonly used bank instrument and most trusted. These are Bank to Bank transaction. These instruments are issued for the defined purpose. They are used to issue further LC’s or Local guarantees.

SBLC is for 1 Year and 1 day and extendible. They are discounted depending upon Bank Ratings and Local Banks understanding.

Fraudsters will tell you we can issue you SBLC under such and such Terms and Conditions. Once terms and conditions are agreed, they will ask to transfer some money to verify your bank account. So that they can issue SBLC. Once you transfer money, you will never see them again. This is one of the very sophisticated frauds.

There are different types of SBLC, and different modus operandi. Outcome is same.

Bank Guarantee/BG – These are one of the frauds. They provide Bank guarantee and will tell give us back 40% and keep remaining amount and you can default. Some similar understanding can be discussed. These BG are asset backed or cash backed transactions. It is used where Banks Provide cash against bank guarantees. Once everything is agreed, they will ask you to transfer small amount so that account can be verified. Once you transfer the money, they will stop responding to you.

These are again at big amount BG and used for big transactions.

There is another very size loan Frauds. Fraudsters say, they can arrange big loans, 500 million, and into Billions for big size projects. They discussed Terms and Conditions and everything. Everything is agreed, they will provide loan approval and everything to look genuine, once everything is done. Then comes processing fees. They will ask you to create escrow account, or direct transfer. This is the trick where they will take your money.

Even though, there is lot of information is available, still we see lot of increase in Financial Fraud, so I decided to write this article.


Devika Primić from Dubrovnik, Croatia on November 13, 2020:

Informative and a must read. Such fraud is a continuous problem. You give us all the details and is most useful.

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