Overseas Money – Beware!

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By PETER ROSENTHAL, President
V.I.P. Trust Deed Company

A customer of mine has been offered a large loan. The borrower owns and operates a farm in Southern California and, frankly, could use a large infusion of cheap money. I have been aware of this ongoing loan for some weeks and had expressed MAJOR CONCERNS that the broker (an Ohio company) had already received $5,000 to “get started”. I warned my customer that “up front” brokerage fees are usually prohibited or at least severely regulated by the appropriate licensing agencies.

The oldest scam in the book is to offer large amounts of cheap “foreign” money to businesses for commercial projects that are “desperate for cash”. Over the years I have seen scams that have involved from $10,000 to $30,000 “up front” commissions to arrange $1 million, $2 million and $10 million off shore loans. Unfortunately, businesses and borrowers truly in need are often the most gullible.

Sure enough, my customer received a multi-page loan agreement that he sent to me for review. The agreement asked for more fees (in certified funds) to continue with this multi-million dollar loan. The best part was that the agreement stated: “none of this documentation can be shared or disclosed to anyone other than your business partner, accountant or lawyer as this may be construed as a violation of Federal law”, i.e. please keep this a secret.

Fortunately for my client, the person signing the letter had a VERY unusual first name. I love unusual names, as they are very easy to check out. Simple names like John Smith are almost impossible. Within five minutes I discovered seven CRIMINAL complaints filed against this individual and one criminal complaint filed against a person with the same last name also associated with this company. Fortunately my customer did not pay the last two fees requested and was able to stop payment on one of two checks previously submitted.

Please remember this scam. It’s one of the oldest and it truly victimizes desperate people who often borrow the up-front fee, thinking that they will receive a windfall in a short period of time. If you are in the process of applying for a large real estate loan or business loan, be very careful. If you know the company that you are dealing with and the fees are truly appraisal fees or toxic inspection fees, that is one thing. If large up-front fees are involved PLEASE, PLEASE, PLEASE refer this to your business attorney or CPA. The naiveté of otherwise intelligent people paying $10,000 to $30,000 to an unknown company is truly amazing. Please have a company like this checked out from stem to stern before dishing out large sums of money in the hopes of obtaining those cheap offshore funds.

Peter Rosenthal
VIP Trust Deed Company