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Historical Bonds: Names You Should Know  
(Source: Hawthorne-Sterling & Company, Inc.)

Historical bonds

Bonds that were once valid obligations of American entities but are now worthless as securities and only collected and traded as memorabilia -- are quickly becoming a favorite tool of scam artists. Here are several things that you should know about them:

Three Lies Used to Perpetrate Historical Bond Fraud:

Lie 1: Historical bonds are payable in gold.

Lie 2: Historical bonds are backed by the Treasury Department.

Lie 3: The Treasury Department has established a federal sinking fund to retire historical bonds.

How Scam Artists Use Bogus Third-Party Valuations to Trick Investors

Scam artists are selling historical bonds to unsophisticated investors at inflated prices far exceeding their fair value as collectibles. They often use third-party valuations, which state that the bonds are worth million or billions of dollars each, to do so. These valuations or authentications, which are often referred to as "hypothecated" or "hypothetical," are completely bogus. A typical valuation will falsely overstate the value of these bonds by assuming erroneously that, notwithstanding the unenforceability of the gold clauses contained in the bonds, as well as the defunct and bankrupt status of most of the bonds' issuers, some person or entity is obligated to redeem the bonds in gold bullion.

Scam artists using such valuations may also make the false assertion that while perhaps not payable today in gold or in money, the bonds are used in high-yield trading programs in the United States, offshore and in Europe. In several cases, the third parties issuing the valuations appear to be working in conjunction with the scam artists. All of these false assertions have been used to defraud investors into paying as much as $150,000 for historical bonds that regularly trade for $25.

Fraudulent Cash and Railroad Bond Program Operator List

Part I consists of those individuals who, through their own words and deeds, have proven themselves cons to unwary investors and have been reported to the various authorities for their Securities Violations. Part II consists of the business names through which these individual have been known to operate. Pertinent notes are sometimes annotated to clarify level of involvement in the fraud and how interconnected.

Extreme caution should be exercised in transactions that may utilize these individuals. Deception has been utilized to cover their involvement in many a transaction by hiding behind other parties. Latest is to, now more than ever, hide under a completely new "front man" and place their "Program" with parties published herein. This list is not all-inclusive and should not be viewed as such.

The author of this publication, Henry R. Wentworth, has spent years developing the database contained herein. His second publication, Bank Debentures: Names You Should Know, contains a database with a focus on the market for 'bank Debentures.'

Recommended further reading:
Internet Fraud:  How to avoid Internet investment scams
Prime bank instrument scam
Frauds, Phonies and Scams
Information on Financial Scandals
Banking Law Direct