Horizon Prime Bank Fraud and Insurance
"Importantly, it appears that many investors were advised and shown a document that they believed indicated that this investment was insured by a $1 billion bond issued by Nationwide Deposit Trust Insurance Company (Nationwide). The Receiver has recovered a copy of a one-page redacted document from the records in his possession that appears to indicate that a policy was issued by Nationwide to an unknown insured providing insurance coverage for Emergency/Catastrophe. However, this document has been redacted so that critical information is missing. In addition, it may have been modified. The Receiver is currently in communication with Nationwide, but it is highly unlikely that such a bond actually exists to protect any investor funds."
An insurance bond works on the imagination in much the same way as the guarantee does in a business opportunties scam or fraud - it dulls due diligence. After all, Nationwide Deposit Trust Insurance Company is real, isn't it? Who can understand insurance policies anyways?
The use of fake or forged financial instruments succeeds in defeating due diligence not because it is hard to determine their authenticity. They serve as roadblocks requiring greater and greater levels of energy and skepticism, which if were present at the beginning would have driven the investor out of the game. These props are used by the scammer to weave an air of reality into a fairy tale and are often all too successful. I wonder how they got the bond document from Nationwide? A clerk hungry for a little pocket cash?
