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. Prime Brokerage

    Prime brokerage refers to a complex group of financial services, ...
  3. Bank

    A bank is a financial institution licensed as a receiver of deposits. ...
  4. Prime

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

    Prime of Prime are tier 2 Brokerage firms that bridge the gap ...
  6. International Banking Act of 1978

    The International Banking Act of 1978 put all American bank branches ...
Related Articles
  1. 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.
  2. Investing

    Amazon Prime's Growth is Slowing: Morgan Stanley

    Based on a survey of 1,000 US consumers, the Wall Street firm says Prime's growth may be slowing.
  3. Tech

    CEO Email Scams Cost $2 billion

    CEO email scams cost a pretty packet, according to the FBI.
  4. Personal Finance

    Fed Hike Is A Costly One For Credit Card Borrowers

    Banks have responded to the Federal Reserve's decision to increase interest rates by hiking their prime rates.
  5. Investing

    Amazon's Prime Day Too Big for 24 Hours, Stock Rally Expected

    Investors on the look out for short-term buy opportunities might be able to make a quick buck out of Amazon in the run up to Prime Day.
  6. 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.
  7. Investing

    Amazon's Original Content Drew Over 5 Million to Prime by Early 2017

    Amazon's strategy to use original video content to get more Prime subscribers appears to be paying off based on internal documents seen by Reuters.
  8. Tech

    The 5 Signs of an IRS Phone Scam

    Tax season is approaching. Be aware of the tell-tale signs of an IRS phone scam.
  9. Insights

    How to Avoid the Top Financial Advisor Scams

    Investors need to be wary of financial advisor scams. Here are the most common and how you can protected yourself.
RELATED FAQS
  1. What's the difference between the prime rate and the discount rate?

    Learn more about the prime rate and the discount rate and how the Federal Reserve uses these rates in the U.S. economy. Explore ... Read Answer >>
  2. What are the top Social Security scams targeted at the elderly?

    Prevent Social Security scams by learning to recognize the most common types of scams that target senior citizens receiving ... Read Answer >>
  3. What is the prime cost formula?

    Prime costs are the costs directly attributed to the production of a product. Before calculating prime costs, direct costs ... Read Answer >>
  4. 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 >>
  5. 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 >>
  6. How does investment banking differ from commercial banking?

    Discover how investment banking differs from commercial banking, the responsibilities of each and how the two can be combined ... Read Answer >>
Trading Center