Scams Involving the Renting or Leasing of Treasury Securities

Enter Source, Feb 10, 2005

We often hear about solicitations to "rent" or "lease" Treasury securities. Many of these solicitations have originated in the United Kingdom, Greece and South Africa. To date, we have yet to hear of a genuine renting or leasing arrangement. Usually, the securities offered either don't exist (for instance, the offer is for bearer securities in an amount that exceeds the amount that remains outstanding in bearer form for that particular CUSIP) or are not owned by the party making the offer. If you ask a leasing scam artist to produce the securities or otherwise prove ownership, he or she will be unable to do so and will proffer excuses such as "they are frozen at my bank;" "a wealthy philanthropist has assigned them to us to assign to others for infrastructure or humanitarian purposes in third world countries and wishes to remain anonymous;" and "bank secrecy laws of this country prevent such a verification." In addition, the scam artist will use one or more of the following tricks to try to con you: