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Simple English definitions for legal terms

Investor Protection Guide: Promissory Note Scam

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A quick definition of Investor Protection Guide: Promissory Note Scam:

A promissory note scam is when individuals convince others to sell promissory notes by promising them large commissions. The sellers may not know that the information they have been given is false or misleading. The fraudsters use a portion of the money collected from investors to pay the sellers their commissions and then abscond with the rest. Promissory notes are a form of debt where an investor loans money to a company in exchange for the company's promise to pay back the principal plus interest over a specific time period. Fraudulent promissory notes are sometimes issued on behalf of fictitious companies and are often targeted towards elderly investors who believe they are less risky and offer a higher-than-market rate of return. To avoid promissory note scams, investors should investigate the person selling the notes, research the legitimacy and financial health of the company offering the notes, and be skeptical of notes that are supposedly insured or guaranteed or promise to be risk-free, high yield investments.

A more thorough explanation:

A promissory note scam is a type of investment fraud where individuals convince others to sell promissory notes by promising them large commissions. The scammers often stay behind the scenes and use false or misleading information to persuade sellers to offer the notes to investors. The fraudsters use a portion of the money collected from investors to pay the sellers their commissions and abscond with the rest.

A promissory note is a form of debt where an investor loans money to a company in exchange for the company's promise to pay back the principal plus interest over a specific time period. Fraudulent promissory notes are sometimes issued on behalf of fictitious companies, and sellers may tell investors that the notes are guaranteed by insurance companies and offer a high rate of return. However, most of the companies that guarantee the notes are unlicensed, and the notes are not usually sold to the general public.

Fraudsters often target elderly investors who believe the notes won't expose them to the risks of the general securities market. Investors purchase the notes believing they are less risky and offer a higher-than-market rate of return. Sellers may encourage investors to cash-in their life insurance policies and buy promissory notes instead.

To avoid promissory note scams, investors should investigate the person who is selling the promissory notes. Generally, these sales persons must be licensed in their state and with the Financial Industry Regulatory Authority. Investors should also research whether the company offering promissory notes is legitimate and healthy enough to pay its debts. Investors should be skeptical of notes that are supposedly insured or guaranteed or notes that promise to be risk-free, high yield investments.

For example, a scammer may convince a seller to offer promissory notes from a fictitious company that promises a high rate of return and is guaranteed by an insurance company. The seller may not know that the information is false or misleading and may encourage investors to purchase the notes. The scammer uses a portion of the money collected from investors to pay the seller's commission and absconds with the rest.

Another example is when a scammer targets an elderly investor and convinces them to cash-in their life insurance policy and purchase promissory notes instead. The investor believes the notes are less risky and offer a higher-than-market rate of return. However, the notes are fraudulent, and the scammer absconds with the investor's money.

Investor Protection Guide: Prime Bank Schemes | Investor Protection Guide: Pyramid Scheme

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13:56
went complete at penn a month ago with still no UR
jackfrost11770
13:56
How was that too ambitious of a thought
jackfrost11770
13:57
March at the very least atp
13:57
@llama: thank you!!! 44 apps thats crazy dude
Trismegistus
13:57
jack me too buddy
lilypadfrog
13:57
@info-man: I applied like a week before you and just went UR a couple days ago you’ll get there in a minute
13:57
I'm actually never gonna hear from BU
13:57
definitely not ambitious at all. this cycle's turning out to be as slow as the last one probably due to high app volume
13:57
@lilypadfrog: okay cool good to know
13:58
i really think they should push back seat deposits to june
13:58
its unfair
jackfrost11770
13:58
Recent boo I applied to BU in Oct
13:59
I've been complete since mid Sept:(
13:59
If I knew I would still be waiting in January I probably wouldn't have applied so early
jackfrost11770
14:00
Me neither
jackfrost11770
14:00
Someone applied to nyu in December and got today
jackfrost11770
14:00
I mgoikg to lose my fucking mind
14:01
re seat deposit: does any1 know if u can request to delay 1st seat deposit? some school are really early it seems
[] starfishies
14:02
if they delayed decisions we should be able to delay deposits... but we do not live a perfect world so i doubt it
lilypadfrog
14:03
yeah you can request an extension. usually it’s like a week though
14:03
i need tips for not falling asleep at work
drugs
14:03
can we talk about something interesting like i dont know drugs sex death
ReminiscentZestyFish
14:04
Everyone admitted to penn looks like above medians
14:04
time to harass glove on linkedin
lilypadfrog
14:06
that’s a good way to stay awake. tell him to come back here
14:08
lily i broke a rubber band already
14:08
le sigh
lilypadfrog
14:08
damn you get vicious with it. just pinch yourself or something
lilypadfrog
14:09
don’t break your finger
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