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Fraud alert: Bogus Treasury notes, bonds, account numbers

November 17, 2010

The office of the inspector general for the U.S. Department of the Treasury is investigating incidences of individuals using fraudulent Treasury-related financial obligations or accounts to purchase or attempt to purchase vehicles from automobile dealerships or to pay debts. 

In Arizona in September, Treasury Department investigators reported that an individual attempted to purchase a $67,000 automobile at a Phoenix dealership using a bogus promissory note and bond. In this instance, the purported value of the note was $75,000 and the bonds were purported to represent government obligations of $150,000; and in another instance, government obligations up to $900 million. 

The Treasury wants to alert dealers about the notes and bonds, which, might or might not be referenced as "U.S. Treasury" bonds or promissory notes; however, they are identified as "personal promissory notes" and/or "private offset bonds," and often contain the name of the Secretary of the U.S. Treasury, currently Henry Paulson, on the document.

The name of the Treasury Secretary would not appear on any document listed as a private bond or promissory note, since these items are not backed or guaranteed by the U.S. Treasury.

Moreover, the only type of paper bond issued by the U.S. Treasury that a citizen can purchase today is a U.S. Savings Bond.  All other Treasury Bonds are electronic transactions and the buyer does not receive an actual hardcopy document. 

In Indiana, the Treasury Department reported that unauthorized individuals were providing automobile dealerships and other retail businesses with bank routing and account numbers in Indiana to purchase vehicles or other property, and/or to payoff personal debts.

The account and routing numbers were represented as personal grant or bank accounts, and the dealers were directed to debit the accounts electronically to fund payments for their purchases. In the reported instance, the account was a Treasury account for vendors to electronically transmit payments to the Treasury Department.

Anyone with information about such Treasury-related fraudulent activities is urged to call the Department of Treasury, Office of Inspector General, Office of Investigation’s Hotline at 800-359-3898 or e-mail to Hotline@oig.treas.gov  

Dealership employees who are approached by a person or persons giving these or similar circumstances should consider the potential for fraud. If fraudulent activity is suspected, call the OIG Hotline or the local police immediately.

More information about this and other similar fraud schemes can be found at the following Department of Treasury Web site,

 

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