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From: Bureau of the Public Debt, "Cheaper by the Dozen"
Time: 8:17:52 AM
Because people think that Government Debt instruments are safe, sometimes they are not too careful when it comes to their evaluation. There is just as much fraud in this market as there is anywhere else and the following list shows a few issues to stay away from.
Examples of Known Phony Securities "Limited Edition" Treasury Securities
We have become aware that certain foreign individuals and groups are attempting to sell fictitious Treasury securities referred to as "Limited Edition" Treasury securities. As part of this scheme, entities such as broker-dealers and banks are being approached to act as fiduciaries for transactions. The proposal to sell these fictitious securities makes misrepresentations about the way marketable United States Treasury securities are bought and sold and it also misrepresents the role that we play in the original sale and issuance of our securities.
We have requested that the SEC investigate this matter and that it notify its foreign securities regulatory counterparts. We have also contacted the NASD, NYSE and financial institution regulatory agencies to alert their examiners and their respective members or financial institutions that they supervise. The Secret Service and FinCEN have also been notified. All of these organizations were advised that there is no such security as a "Limited Edition" Treasury security. In response to our requests, a number of regulatory agencies have issued alerts or warning notices to their institutions and members.
U.S. Treasury Bills - One Year "Fresh Cut"
We have become aware that the above-named fictitious securities are being offered for sale. An individual was offered these securities by a person who represented himself to be a consultant to Lesser Developed or Third World countries. This particular transaction was for $500 billion -- an astounding amount in itself. In another incident, a large government securities dealer was contacted to enter into a transaction involving these fictitious securities. We never issued any Treasury bills that were named One Year "Fresh Cut."
"U.S. Dollar Bonds"
We get many inquiries, mostly from the Far East, about these bonds being issued in the 1930's or early 1940's by the CIA to help Chiang Kai-shek fight the communists. It is alleged that they have been buried in caves by his generals and their heirs for years and have recently been unearthed. They are now being fraudulently offered to people at a fraction of their face value. This story is false. These securities are not genuine and do not bear provisions that even remotely resemble Treasury securities. Click on the thumbnail image at left to view a full-size image of an alleged "U.S. Dollar Bond" (130K JPG file).
Most of these fictitious obligations, on their face, refer to the Ministry of Finance of the United States and the Washington Bank of America. There never was a Ministry of Finance of the United States and to the best of our knowledge, the Washington Bank of America is non-existent. When confronted with this information, fraud artists still fall back on the "CIA did it and didn't tell anyone" routine. The visual appearance of a registered or bearer Treasury security is considerably different from so-called United States Dollar Bonds.
There have been arrests and convictions in the United Kingdom against individuals that were alleging these to be obligations of the United States. Several other investigations are being conducted. Many of our inquiries come from West Coast law firms that are checking on the validity of these bonds for clients that reside in China, Singapore and Taiwan.
"Federal Notes" and "Tiger Zebra" Bonds
We have received more contacts about these bogus securities. Sample securities sent to us proved to be combinations of old $100 bills that had been altered to read "One Hundred Million Dollars" and bogus coupons printed in a foreign language. We have never issued "Federal Notes" or "Tiger Zebra" Bonds. Moreover, we have never issued a security with a denomination of $100 million and have never issued a security with coupons in a foreign language. Click on the thumbnail image at left to view a full-size image of an alleged "Federal Note" (117K JPG file).
"De-facto" Treasury Securities
This term usually appears in offers to assign, rent or lease Treasury securities to an offeree for a fee, for a certain time period. These securities are bogus as we have never issued any securities called "de-facto" Treasury securities.
Philippine Victory Notes
There have been several inquiries regarding Philippine Treasury Certificates of Deposit and their relationship to Philippine Victory Notes. Philippine Treasury Certificates, Victory Series 66, commonly known as Philippine Victory Notes, were issued in 1944 by the Philippine Government. These currency notes were for use only in the Philippines, which at the time was a dependency of the United States, and were obligations of the Philippine Treasury.
The 500 Peso Philippine Victory Notes were demonetized by the Philippine government on December 31, 1957, and were withdrawn from circulation. At that point, other denominations of the Philippine Victory Notes, Victory Series 66, were no longer regarded as legal tender but could be exchanged or replaced at par, without charge, for legal currency until July 30, 1967. After that date, Series 66 was considered demonetized. If these notes are presented to you and purported to have current value today, it is a scam.
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Updated March 16, 1999