The 2021 Edition of the Prime Bank Note Scam

February 1, 2021

Speakin' of being stuck in a lousy rut, the SEC is once again ferreting out prime bank note scammers. SEC Wins Summary Judgment Against Georgia Individual in Prime Bank Investment Scheme (SEC Release / January 26, 2021)
/2020/lr25015.htm Wow, here we are 2021 and we're still dealing with nonsense that was all the rage over a decade ago. I guess if it ain't broke, ya don't need to fix it but, c'mon, have a little pride when you're running a hustle. The good thing is that the SEC is all over this. The bad thing is that the hustle is still being run. Sadly, it ain't lookin' like we're going to see sunshine, lollipops, and rainbows any time soon.  

The 2019 SEC Complaint

In a Complaint filed in June 2019 in the United States District Court for the Northern District of Georgia ("NDGA"), the SEC alleged that Peter Baker, Elizabeth Oharriz, and Baker's company: Prestige Global Trading, LLC, and Oharriz's companies: Diversified Consulting & Logistics, Inc. and Sienna Business Group, Inc. violated the antifraud provisions of Section 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act and Rule 10b-5 thereunder. Additionally, the Complaint alleged that Baker and Oharriz violated the registration provisions of Section 15(a) of the Exchange Act. 

NDGA Grants 2021 Motion for Summary Judgment

NDGA granted the SEC's Motion for Summary Judgment against Baker, and found that he had violated the charged provisions and reserved the determination of penalties or other relief for a later date. Separately, Oharriz and her companies entered into a bifurcated settlement, agreeing to be permanently enjoined from violations of the charged provisions with monetary relief to be determined by the court at a later date. As alleged in part in the SEC Release:

[B]aker and codefendant Elizabeth Oharriz engaged in a scheme to sell fictitious prime bank instruments to investors, misrepresenting the instruments as legitimate and claiming that investors would earn substantial profits. As alleged in the complaint, Baker and Oharriz defrauded five groups of investors out of over $2 million and attempted to prevent investors from uncovering the fraud by providing them with fabricated bank documents.

Oh for godsakes, really? 

The 2015 SEC Investor Alert

Not only do we have idiots still running the old prime bank note scam but, go figure, we also have idiots who still invest in this crap. Some six years ago, the SEC posted this warning at

Investor Alerts and Bulletins
Investor Alert: "Prime Bank" Investments Are Scams 
Feb. 5, 2015

The SEC's Office of Investor Education and Advocacy (OIEA) is issuing this Investor Alert to warn investors about fraudulent investment schemes involving purportedly high-yield, risk-free international finance programs.

All "prime bank" investment programs are fraudulent.  Promoters of prime bank programs often claim that investors' funds will be used to buy and trade supposed prime bank instruments, and that investors will receive guaranteed, high investment returns with little or no risk.  Promoters try to make the schemes sound legitimate by using complex, sophisticated, and official-sounding terms.  These may include: debenture, standby letter of credit, bank guarantee, prime world bank financial instrument, private funding project, offshore trade or trading program, trading platform, trading facility, trade slot, high-yield trading or roll program, guaranteed bank note, or some variation. . . .

Frankly, you can't be more blunt than that. The SEC's warning was in very stark terms:

All "prime bank" investment programs are fraudulent.

The SEC's warning doesn't say a "few" or "some" prime bank programs are fraudulent. No, the SEC alert opted for the word "all." As in whatever you can point a stick at is fraudulent. And despite such an all-encompassing warning, there are those out there who think that they've come upon the one prime bank note deal that's not a fraud. 

A Trip Down Sordid Memory Lane

Nearly a decade ago, I published "Range Rover, Jaguar,And Jimmy Choo Shoes Highlight SEC's Prime Bank Case" ( Blog / December 6, 2011)
My 2011 article had all the impact of Cassandra telling her fellow Trojans "You know guys, I'm trying to tell y'all that you shouldn't wheel that wooden horse into our city." For those of you unfamiliar with my reference, watch this:

So . . . what exactly were my words of warning in 2011?  
Well, here's a reprint of the BrokeAndBroker Blog from way back when:

 "Range Rover, Jaguar,And Jimmy Choo Shoes Highlight
SEC's Prime Bank Case
( Blog /  December 6, 2011)

Way down in Paragraph 26 of a recent Securities and Exchange Commission's ("SEC") Complaint, you see it, you can read it, and it gives you a sense of how yet another financial scam was launched against duped investors:

The defendants promised investors extraordinary returns of up to twenty times the principal amount invested with little or no risk. To deceive them into believing the purported investment was legitimate, the defendants provided investors with documents containing meaningless legal-sounding terms and references to non-existent financial instruments and institutions. To fend off further inquiries, which might have provided information investors could have checked for themselves and found out about the fraud, investors were told that confidentiality and secrecy requirements prevented the defendants from providing details of the investments.

What is this all about? Well, for starters, On November 30, 2011, the SEC filed an enforcement action under seal in federal court in Washington D.C. and obtained an emergency court order to halt a Prime Bank scheme. Thereafter, on December 5, 2011, the Court unsealed the action.

The SEC's Complaint alleges that from at least August 2010 defendants Frank L. Pavlico, III, a/kIa Frank Lorenzo, and Brynee K. Baylor and entities they control, including defendants The Milan Group, Inc., a/k/a The Milan Trading Group, Inc., and Baylor & Jackson, P.L.L.C.  conducted a "Prime Bank" scheme that defrauded at least thirteen investors out of approximately $2.1 million. I want you to digest the full caption of the Complaint so that you can appreciate the enormity of this matter:

Securities and Exchange Commission v. The Milan Group, Inc., a/k/a The Milan Trading Group, Inc., Frank L. Pavlico III, a/k/a Frank Lorenzo, Brynee K. Baylor, Baylor & Jackson, P.L.L.C., Mia C. Baldassari, Elmo Baldassari, Brett A. Cooper, Global Funding Systems, LLC, GPH Holdings, LLC, Dawn R. Jackson, Patrick T. Lewis, Susan C. Kevra-Shiner, a/k/a Susan C. Kevra, The Law Office of Susan C. Kevra (Civil Action No. 11-cv-02132 (RMC) (D.D.C. Nov. 30, 2011)

NOTE: The SEC Complaint is only an allegation, and the defendants are presumed innocent unless or until proven guilty.

Bill Singer: Wordsmith

When we're talking about so-called "Prime Banks" in these scams, we're not talking about any bank that you would likely know.  Oh, sure, as part of the con artists' patter, they may drop some names. You may hear references to Citibank or UBS or Bank of America or JP Morgan - but they're not involved other than being victimized by having their names thrown into the garbage bin.  What you may hear about are fanciful institutions such as the International Clearing Bank of the Caribbean Economic Authorities.  You like that one?  I made it up, took me about two seconds.

You may also be told that non-circulating bank remittances involved in sovereign debt recertification are available on a floating basis through issuance of the Royal Bank of Emirates Limited or the Brazilian Developmental Petrochemical Bank. These non-circulating sovereign debt recertifications are known in the trade as NSDRs and are available in monetized units of $100,000 subject to proof of eligibility for offshore financial placement by the issuing authority. Yup - made all of that up too, every single thing in this paragraph. Just because it sounds impressive and a lawyer assured you of the bona fides, doesn't mean jack.  Wise up, people!

Nothing New Here

If the SEC's allegations are ultimately proven true, what we got here is yet another in a long, long, long line of Prime Bank scams.

READ: UPDATE: The Lawyer, Judge, Financial Wizard's Tranche Trading Platform Deal ( Blog / September 29, 2011) for some sense of the history and nature of these rip-offs.

Despite all the warnings that are amply and prominently posted on numerous websites, I guess a lot of wannabe investors don't really understand the need to undertake due diligence - even rudimentary.

SIDE BAR: the Prime Bank Fraud Information Center (

2Good 2B True

The Complaint further alleges that defendants Pavlico and Baylor offered potential investors extraordinary returns - in one example, up to twenty times the original investment within forty-five days. If you weren't sent running for the hills when pumped with those overblown promises, you were then told that the investment involved no risk . Uh huh, sure - why wouldn't a no-risk investment offer 20 times returns within a month and a half. On top of that, the defendants allegedly promised that your principal would be returned if a successful bank instrument transaction was not completed.

You got that? Twenty times return. Only a 45-day investment window. No risk. Full return of principal if your investment is not placed as promised.  I can also get you the Brooklyn Bridge for no money down and your total out-of-pocket cost is locked-in at $32,000 plus a $5,000 handling charge (payable to me up front).

Trust Me, I'm A Lawyer

As noted in UPDATE:The Lawyer, Judge, Financial Wizard's Tranche Trading Platform Deal, we seem to have a number of lawyers acting as pitch-men and -women in these transactions. The Complaint alleges that defendant Baylor "cloaked these offers in legitimacy by acting through her capacity as a licensed attorney and by identifying herself and her Washington, D.C. law firm, B&J, as counsel for Milan and engaging in the scheme through B&J."  As if the legal profession needed another black eye.

Danger! Warning!!

I particularly like how the SEC didn't dance around with niceties in this action and truly tried to let future victims know just what is involved in these Prime Bank scams. Pointedly, the Complaint warns that:

[C]ontrary to their representations, Pavlico and Baylor never used investor funds to lease, leverage, or trade any purported foreign bank instruments. Instead, Pavlico and Baylor used investor money to purchase luxury cars such as a Range Rover and a Jaguar, make purchases at expensive restaurants and retailers including Jimmy Choo, pay for a trip to the Bahamas, pay other personal expenses, pay B&J business expenses, and make payments to the relief defendants.

Bill Singer's Lament

Alas, I've grown tired of sounding the alarm. You wanna buy a piece of a Prime Bank note?  Go ahead, be my guest. Don't do any research. Believe the unbelievable. Just do me a favor - don't send me an email suggesting that I do yet another story about this nonsense.

Finally, compliments to the SEC on not only moving relatively quickly but putting together a compelling Complaint.