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.

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