Scam of the day – January 28, 2015 – Phony Chinese bank scams millions

Scam artists are the only criminals and with good reason, the creativity and audacity shown by these criminals can sometimes be astounding.  Recently, a phony Chinese bank was shut down by Chinese authorities, but not before it had swindled innocent Chinese customers including a large number of small businesses out of an estimated 200 million dollars.  The phony bank, Nanjing Mou Village Cooperation Unit operated in the Chinese city of Nanjing for about a year before the fraud was discovered and the bank closed down by authorities.  Physically it looked like a bank, but it had no legal authority to act as a bank.  As with so many scams, a telltale sign is an offer that is too good to be true.  In this particular case, the bank promised depositors 2% interest on their deposits each and every week.   A phony bank scam is nothing new to China.  In 2012, Lin Chunping claimed to have purchased and then operated an American bank in China that turned out later to be nonexistent.  Lin is now serving a life sentence for fraud.

TIPS

When it comes to investing or banking, you should always check out the legitimacy of the financial institution before turning over your  money.  There are many federal and state regulatory agencies that relate to various financial businesses and it is an easy task to find out prior to investing or saving with a particular company or bank whether or not the company is legitimate.  Of course, anytime you are enticed by an offer that sounds too good to be true, you should be particularly skeptical and at this point in time a promise of 2% per week is outrageously unlikely to be legitimate.

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