What is a 'Prime Bank'

Prime bank is a term used to describe a large, well-known bank but is also a phrase frequently used as part of a financial scam. Prime banks, because they are so big, move large amounts of money at a time and make sizable investments. They also trade instruments such as world paper, International Monetary Fund bonds, and Federal Reserve notes. There has been an ongoing scam that involves fraudsters calling potential victims with opportunities for investing in non-existent prime bank investments through an institution that does not exist.

BREAKING DOWN 'Prime Bank'

Prime bank is a phrase used to describe a significantly large bank. Prime banks trade large sums of securities. The term prime bank has become synonymous with scams. It is often used by fraudsters looking to give some legitimacy to their scheme. Fraudulent prime bank campaigns often claim investors' funds will be used to purchase and trade "prime bank" financial instruments for huge gains. Unfortunately, these "prime bank" instruments often never exist and people lose all of their money.

RELATED TERMS
  1. Wall Street Journal Prime Rate

    The Wall Street Journal Prime Rate is an average of the prime ...
  2. Reloaded

    Reloaded is a slang term meaning that a consumer who was previously ...
  3. Bank

    A bank is a financial institution licensed as a receiver of deposits. ...
  4. Bottom-Dollar Scam

    A bottom-collar scam is a fraudulent claim by swindlers or con ...
  5. Prime

    Prime is a classification of borrowers, rates or holdings in ...
  6. Prime Of Prime - PoP

    Prime of Prime are tier 2 Brokerage firms that bridge the gap ...
Related Articles
  1. Personal Finance

    The Role of a Prime Broker

    Understand the role of a prime brokerage, and learn about the services investment banks provide for hedge funds while in the role of being a prime broker.
  2. Insights

    Watch Out For These Top Internet Scams

    The Internet had make it easier than ever for scammers to trick people into giving away their money and personal information. These are the scams to avoid.
  3. Investing

    How To Avoid Becoming A Fraud Victim

    Be aware of your rights as a consumer, and know how scammers work so you can protect your money.
  4. Investing

    Amazon Prime Day Breaks Records

    Prime Day event was a huge success, becoming the biggest sales day ever for the ecommerce giant.
  5. Investing

    Amazon Prime's Crazy Long Reach

    Amazon's Prime now has 85 million US members, up 35% from a year ago, according to CIRP.
  6. Investing

    Whole Foods Could Draw Millions to Amazon Prime: MS

    Whole Foods could boost the number of Prime members Amazon has by the millions.
  7. Insights

    Amazon.com's Prime Day Deals are Here (AMZN)

    Did you miss Amazon's Prime Day last year? It's back with over 100,000 deals.
  8. Tech

    Stop Scams in Their Tracks

    Find out how to protect yourself and your loved ones from financial fraudsters.
  9. Trading

    Spotting a forex scam

    Learn what to look out for. Forex scams are more common than you think, and new ones will continue to pop up.
RELATED FAQS
  1. What is the average profit margin for a company in the banking sector?

    Learn what the average profit margin is for companies in the banking sector, along with other evaluation metrics often used ... Read Answer >>
  2. How does a pump and dump scam work?

    A pump and dump scam is the illegal act of an investor or group of investors promoting a stock they hold and selling once ... Read Answer >>
  3. What's the difference between the prime rate and the repo rate?

    Learn about repo rates and prime rates and their differences. Explore the uses of these rates in consumer lending and managing ... Read Answer >>
  4. What is the banking sector?

    Learn why the banking sector is a vital industry to our economy, what it does to drive the economic growth and understand ... Read Answer >>
Trading Center