Treasury direct account scam

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Frauds, Phonies, & Scams

The Bureau of the Fiscal Service and the U.S.Treasury are aware of several fraudulent schemes or scams that involve what are claimed to be securities issued or backed by the Treasury Department or another part of the United States Government. These scams have been directed at banks, charities, companies, and even individuals, by individuals or organizations seeking payment on the fraudulent securities. These pages will alert you to these scams and help you protect yourself. Select from the links below to learn more.

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How Marketable Treasury Securities Work
Learn about the types of securities, how they are sold, and how book-entry securities are held.

Scams Involving Treasury Securities
Find out more about the renting, leasing, or blocking of Treasury securities

Examples of Known Phony Securities
See examples of phony securities and learn more about the scams.

Historical Bond Fraud
Learn about the many scams involving historical bonds.

Prime Bank Instrument Fraud
Find out about the different types of fraud, and important buzzwords and red flags to watch for. Also, get links for investigative help.

How to Protect Yourself from Investment Scams

Other Fraud Sites of Interest
Links to resources that will help you protect yourself from fraud.

Prohibition Against Misuse of Treasury Names, Terms, Symbols, Stationery, Etc.
See examples of illegal solicitous mailings made to appear like official federal government communication.

Bogus Sight Drafts/Bills of Exchange Drawn on the Treasury

Birth Certificate Bonds
Read about the scam involving birth certificates and savings bonds.

Note: Some of these publications are in Adobe's Portable Document Format (PDF). If you do not have the Adobe Reader, it is free to download.

Sours: https://www.treasurydirect.gov/instit/statreg/fraud/fraud.htm

Scams Involving Treasury Securities

Find out more about the renting, leasing, or blocking of Treasury Securities in the content below.

Renting or Leasing

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 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 offer 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." Also, the scam artist will use one or more of the following tricks to try to con you:

Misuse of Fiscal Service Forms as Evidence of Ownership

Scam artists often misuse Fiscal Service forms to try to prove ownership or to make the scam seem "official." The two forms that are commonly misused are:

(1) FS Form 1832 - Special Form of Assignment for U.S. Registered Definitive Securities
(2) FS Form 1071 - Certificate of Ownership of United States Bearer Securities

The FS Form 1832 and FS Form 1071 have nothing to do with book-entry bills, notes, or bonds. Unless there are securities physically attached to one of these forms, the form is meaningless and worthless. We only use FS Form 1832 in some cases to correct defective assignments of securities already in our possession. We also sometimes use it for the assignment of a large number of securities or where there is an assignment by two or more geographically separated owners. In all cases, the form is not valid unless the registered securities accompany the form.

We use FS Form 1071 to validate the ownership of bearer notes and bonds that are presented for redemption after they have become overdue. A bearer security becomes overdue after the lapse of between one and six months time from its face maturity date, depending on the original term of the security (such as, three months for a three-year note).

Scam artists try to use the forms as "evidence" that they hold the securities and claim that the forms can convey ownership or title to the securities listed on the forms. But, if you look at such a form you should see that the scam artist is misusing the form and cannot prove ownership of the securities listed. For instance, a typical misused FS Form 1071 will fail to list serial numbers for any bearer securities allegedly owned and will fail to provide information explaining why the securities were not presented for payment before they became overdue. (The latter occurs because the bearer securities allegedly owned have not reached maturity at the time the form is misused.) Note:  FS Form 1071 used to be known as PD F 1071.

Misuse of CUSIP Numbers as Evidence of Ownership

Scam artists will also use a valid CUSIP number of a Treasury security that trades regularly in the market so a potential victim can get pricing information and confirm that we did issue the security. CUSIP is an acronym for the Committee on Uniform Securities Identification Procedures. Each security issue (stocks, corporate, municipal, or Treasury securities) has a unique CUSIP number. The CUSIP number is public information and it identifies an entire issue of a security. It does not identify any specific security, nor does mere use of it show ownership.

Claims That the Scam Has Been Certified by an Official Body

Scam artists may claim that an official body, such as the U.S. Embassy in London or the International Chamber of Commerce, has certified their fraudulent offering. They may also claim that we have created a special issue to the United Nations to pass on to other companies that were willing to do humanitarian and infrastructure projects in developing countries. All these claims are patently false.

Blocking of Assigned Treasury Securities

We periodically get requests to block off an amount of Treasury securities so the securities can be used to fund humanitarian or infrastructure projects in developing countries. This request is impossible for us to honor. We only sell securities at public auctions. We cannot block securities that we do not own.

View the Tentative Auction Schedule.

Sours: https://www.treasurydirect.gov/instit/statreg/fraud/fraud_scamsinvolving.htm
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Bogus Sight Drafts/Bills of Exchange Drawn on the Treasury

There has been a proliferation of bogus sight drafts and bills of exchange drawn on the U.S. Treasury Department. These documents have appeared in a majority of states and have been used in an attempt to pay for everything from cars to child support. View image of a "Bogus Sight Draft (230K JPG file, uploaded 12/12/2002)."

The Story

A stripped-down version of this scheme is as follows: When the United States went off the gold standard in 1933, the federal government somehow went bankrupt. With the help of the Federal Reserve Bank, the government converted the bodies of its citizens into capital value, supposedly by trading the birth certificates of U.S. citizens on the open market. After following a complicated process of filing UCC documents with either the Secretary of State of the person's residence or another state that will accept the filings, each citizen is entitled to redeem his or her "value" by filling out a sight draft drawn on their (nonexistent) TreasuryDirect account. The scheme asserts that each citizen's Social Security Number is also his or her account number. As a part of the scheme, participants also file false IRS Forms 8300 and Currency Transaction Reports in the name of law enforcement officials and other individuals they seek to harass.

The Reality

Drawing such drafts on the U.S. Treasury is fraudulent and a violation of federal law. The theory behind their use is bogus and incomprehensible. The Justice Department is vigorously prosecuting these crimes. Federal criminal convictions have occurred in several cases. The Office of the Comptroller of the Currency has tried to alert the banking community to this fraud. See Suspicious Transactions, Fictitious Sight Drafts. (3K txt file, uploaded 5/16/00)

A Note on Bills of Exchange

With early and vigorous prosecution by the Justice Department on bogus Sight Draft cases, we have begun to see Bills of Exchange taking their place. This change occurred on or around January 2001. All these Bills of Exchange drawn on the U.S. Treasury are worthless. All the same issues and background materials applicable to Sight Drafts also apply to Bills of Exchange. This is the same fraud under another name.

For inquiries by anyone adversely affected by this fraud, please contact the Treasury Office of Inspector General (OIG).

Sours: https://www.treasurydirect.gov/instit/statreg/fraud/fraud_bogussightdraft.htm

Prohibition Against Misuse of Treasury Names, Terms, Symbols, Stationery, Etc.

Section 333 of title 31 of the United States Code prohibits the misuse of names, terms, symbols, and stationery of the Department of the Treasury or its subdivisions for business activities that could be reasonably construed as falsely implying that such activities are authorized by the Treasury.

Despite this legal prohibition, businesses sometimes send solicitations that are crafted to look like they are sent by Treasury. These solicitations often contain disclaimers stating that the businesses are neither government agencies nor affiliated with any government agencies, but the use of any disclaimer is legally irrelevant to the determination of whether the statute has been violated.

How You Can Help

Such mailings are illegal under section 333 and can result in significant civil and criminal penalties, including administrative levy of monetary assessments by the Treasury Inspector General against those who misuse protected Treasury words or marks.

Our continued success in protecting the public from such misuse or misrepresentation depends on your help. If you receive such a solicitation, please send it to us at the following address:

Bureau of the Fiscal Service
200 Third Street, Room 305
Parkersburg, WV 26106

Sours: https://www.treasurydirect.gov/instit/statreg/fraud/fraud_prohibitmisuse.htm

Scam treasury direct account

Covid-19 Scams

Information on how to report COVID-19 scam attempts.

Phone and Email Scams

If they claim to be from the Treasury (non-IRS), report it by visiting Report Fraud, Waste, and Abuse. For any report of a fraudulent call, include:

  • The exact date and time that you received the call (s)
  • The phone number of the caller
  • The geographic location and time zone where you received the call
  • A description of the communication.

If they claim to be from the Internal Revenue Service, report it to [email protected], subject line: “IRS phone scam.” You may also report these calls to the Treasury Inspector General for Tax Administration, which has jurisdiction over IRS-related matters.

Mail Scams

If you receive something suspicious in the mail claiming to be from the US Department of the Treasury, report it to the Treasury Inspector General:

If you receive something suspicious in the mail claiming to be from the Internal Revenue Service, report it to the Treasury Inspector General for Tax Administration

Sours: https://home.treasury.gov/services/report-fraud-waste-and-abuse/report-scam-attempts
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Examples of Known Phony Securities

"Limited Edition" Treasury Securities

Some foreign individuals and groups are trying to sell fictitious U.S. 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 securities are bought and sold, and it also misrepresents the role that we play in the original sale and issuance of our securities.

U.S. Treasury Bills - One Year "Fresh Cut"

These fictitious securities are being offered for sale. A person who said he was a consultant to less developed or Third World countries offered an individual these securities. This 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 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 1930s or early 1940s 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 and have recently been unearthed. They are now being fraudulently offered at a fraction of their face value. These securities are not genuine and do not bear provisions that even remotely resemble U.S. Treasury securities. Click to view, (599K JPG file, uploaded 12/12/02)> a full-size image of the thumbnail image pictured.

Fraudulent "Federal Notes" or "Bonds"

These bogus securities are commonly known as "Morganthaus." Henry Morganthau, Jr. was Secretary of the Treasury in 1934. These "federal notes" are not currency, nor are they bearer bonds. They are crude forgeries that appear to have originated out of the Philippines. The story being told is that the United States shipped them to Philippine freedom fighters during World War II to help with the war effort. Some "investors" have brought them to us in so-called "Federal Reserve" metal boxes, along with other related certificates, such as:

  • Global Immunity (file size 277K, JPG file uploaded 12/12/02),
  • FDIC Insurance (file size 261K, JPG file uploaded 12/12/02),
  • Gold Bullion (file size 325K, JPG file uploaded 12/12/02),
    • Shipping manifests,
    • "Gold" coins.

These crude forgeries were likely made by inserting images of $100, $1,000, and even $1 bills into a computer program, then altering the amounts to read $100 million or $500 million, and adding coupons in both English and Chinese script. Most were printed on modern color printers or copiers, which did not exist in 1934 - when these bogus notes are alleged to have been issued. The U. S. Treasury did not issue securities (bonds) in $100 million or $500 million denominations during the period alleged in this fraud. Click to view a full-size image of the thumbnail image pictured.

The largest Federal Reserve note ever printed was $100,000 and was only used inside the banking system. For more information on this currency item, please review the FAQ at https://www.treasury.gov/resource-center/faqs/Currency/Pages/denominations.aspx.

"Defacto" Treasury Securities

This term usually appears in offers to assign, rent, or lease U.S. Treasury securities to an offeree for a fee, for a certain time period. These securities are bogus, since we have never issued any "defacto" Treasury securities.

Philippine Victory Notes

We have received inquiries about Philippine Treasury Certificates of Deposit and their relationship to Philippine Victory Notes. The Philippine Government issued Philippine Treasury Certificates, Victory Series 66, commonly known as Philippine Victory Notes, in 1944. 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.

Sours: https://www.treasurydirect.gov/instit/statreg/fraud/fraud_phonyexamples.htm

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If the deal seems too good to be true, it probably is. If you have an offer of assignment or to rent or lease a U.S. Treasury security for a certain period, it is, in all likelihood, bogus. Here are some ways to check the validity of offered securities, and how to protect yourself:

  • Be especially wary of securities offered for assignment or offered as proof of financial stability that bear the CUSIP number of 912810BU1.
  • Demand that the offeror produce the securities or evidence of ownership. If they can't, you should not consider the offer genuine.
  • Demand a statement from the financial institution holding book-entry securities. The statement should be sent to you directly.
  • Question the validity of any securities and information furnished to you with a trusted and informed source, such as your broker, accountant, or lawyer.
  • Confirm that the certifying or holding organization is legitimate, still in business, and how long it has been in business. Call the organization for specifics on the purported existence of the securities.
  • Ask if the person offering the investment is registered with the SEC or with the securities agency in the state or country where you live.
  • Do not assume that people or organizations are who they say they are.

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Resources and Tools

Savings Bond Rates

Rates effective through October 31, 2021. New rates will be posted November 1, 2021.

Sours: https://www.treasurydirect.gov/instit/statreg/fraud/fraud_howtoprotect.htm


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