The Ontario Securities Commission and the RCMP are warning investors about legitimate sounding offers like "Prime Bank Notes," "Prime Bank Debentures," "Trading Programs," and "Roll-Over Programs" used to lure investors into illegal investment scams.

These schemes sometimes claim affiliations with major international institutions like the International Chamber of Commerce (ICC), the International Monetary Fund (IMF), or the U.S. Federal Reserve. These claims are false.

Scams artists lead investors to believe that they can participate in a secret trading regime. Investors might be required to sign non-disclosure agreements that prevent them from disclosing the identity of the parties involved and the terms of the transactions. Often, some parts of the schemes are transacted through a country regarded as a secrecy haven and investors are told they will avoid paying any taxes on investment returns.

Investors are promised above average returns or guaranteed unrealistic rates of return within a short period of time (e.g. 5% return per month, or 20% - 30% annually), completely risk free. Little or no information is provided to investors about the specifics of the investment. Any documents offered use technical language in an attempt to confuse investors into believing their investments are worthwhile.

Investors already involved in the scheme are encouraged to recruit others to invest, and offered cash incentives. Many individuals brought into these schemes are relatives or friends of the initial investors; they are less sceptical of the investments because they trust the family members and friends who made the referrals.

The OSC and the RCMP would like to remind investors that when in doubt about the legitimacy of a proposed investment, you can usually rely on this basic principle: "If it sounds too good to be true, it probably is!"

Anyone solicited to invest in a "prime bank" investment scheme or anyone having information pertaining to this or a similar scheme, should contact the RCMP. For a list of phone numbers and e-mail addresses follow this link http://www.rcmp-grc.gc.ca/scams/prime_bank_e.htm. The OSC can be reached at (416) -593-8314 or 1-877-785-1555 or http://www.osc.gov.on.ca.