Financial frauds and scams may not be a nice topic to close on before Christmas. But it’s an important one. I think even more so than in past years, I’ve talked to many investors this past year who have lost money – sometimes large amounts – in offshore investment scams of one type or another. They and their families won’t be having a great Christmas. So I think it’s an important topic.

It’s certainly not that offshore is full of scammers or even risky. Scammers are everywhere. But offshore investors often make an easy target. Forewarned you can go out and make money offshore without worrying about such things. That is why it’s important you read this article if you want to avoid forex scams, ponzi schemes and the like.

Back in the summer I was invited by a rather mysterious company to a ‘forex luncheon’ in a building in Panama City (Ocean Business Plaza to be precise). I thought it a little odd, since I have nothing to do with forex, but in the spirit of investigative journalism, I went along…

Over ordered-in sushi, which was rather good by the way, the host proceeded to make a presentation about dodgy-sounding hedge funds, roll over programs and a lot of other stuff that had absolutely nothing to do with forex.

I was not the only financial professional there – and whilst everybody was very polite it was clear that nobody in the room was taking the presenter seriously. Some people simply got up and walked out after finishing their sushi. Why they invited me I have no idea, since surely I have a certain reputation as a scam investigator by now and we have an article on our site warning against exactly this kind of scam: Due Diligence for Offshore high Yield Investment Programs. This particular scheme predictably went down a few months later.

During 2009 some of the opaque offshore investment schemes that have collapsed include:

• Hatfield Oak International
• Venture Resource Group (VRG)
• GCI
• Finanzas Forex
• Global Prosperity Plan a.k.a. Global Pension Plan (Belinda Eigenman)
• and several Swedish Credit Unions

Sweden, while a very stable and reputable country, has spurned a minor industry in scams with its credit union legislation. I’ve come across various Swedish Credit Unions over the years and not one has been legitimate.

There are doubtless many others of which I am not even aware. But they all share the same characteristics: above average (unrealistic) rates of return offered, not marketed through conventional channels, based offshore and relying on secrecy to attract clients… and if pushed, they claim that they achieve their returns using forex trading.

Forex trading is extremely high risk. If you have a good, honest broker, you can either make or lose a lot of money. The problem is that few people really understand forex trading so it is an easy play for scammers. There are mysterious entities like CLS Bank and the DTCC that I have written about previously that really do settle multiple trillions of dollars per day in transactions.

Obviously, if you have a dishonest broker, you get the potential downside without the potential upside. Though in reality, the vast majorioty of these scams are classic ponzi schemes that have absolutely nothing to do with forex.

Over the years, clients of Q Wealth have lost millions to scammers of this type. I know, because I’ve seen the proof. Unfortunately these people came to us after they had problems getting their money out.

Others have been smart enough to come to us before putting their money into such schemes, and we can honestly claim to have saved those people millions over the years too. For those who don’t know, one of the benefits of Q Wealth membership is that you can contact us any time for impartial, informal advice on any investment you are thinking of participating in. That alone could be worth thousands of times the cost of membership to you, so I know some members see their $87 annual subscription as a kind of insurance policy.

Doubtless in 2010 we will continue to see lots of similar schemes. Offshore is not full of scammers. If you follow the advice here and in our free weekly e-letter Q Bytes you can easily reach the best reputable offshore banks and offshore brokerage houses. Although we don’t get into investment advice as a business, when we see something good from a reputable source, we do let our members know – recently we’ve been recommending resource and gold mining stocks for example.

What are the trends in scams? What do I expect to see in 2010? The classic ponzi will always be around, because there are always new marks who will fall for it. Probably the forex tag will continue to be applied to these scams.

However, there are some new emerging trends that I have seen in recent months. One is forestry investments – high yields guaranteed from the Brazilian rain forest or from noni or teak plantations in Panama. Following the Copenhagen summit, expect to see more scams revolving around carbon credit trading. And following the surge in gold prices, I am already seeing ads online from penny stock pushers (boiler room penny stock scam operations) who are literally touting the latest ‘undiscovered’ gold mine!

We will also continue to see fraud attempts surrounding documentary credits. Letters of credit and bank guarantees are legitimate instruments used in international trade. But serious international traders have never heard of things like prime bank guarantees, roll-over programs, bank debentures, proof of funds leasing, standby letters, seasoned notes or anything of that nature. Also look out for anything that describes itself as a ‘HYIP.’

So don’t be scammed in 2010. Avoid anything mentioned above like the plague – and if you’re a Q Wealth member who is not sure about something, just write me or Richard and you will get an individual reply in due course. Final piece of advice: if you haven’t yet read our free five part course ‘Secrets of the Super Rich’ you should do so. It is without obligation, and did I mention it’s free? Just enter your e-mail address in the sign-up box above to receive yours.

In this article: a quick preview of a way to profit from economic turmoil… Canada’s largest ever gold discovery. This is something our Q Bytes subscribers already received details of today. If you are not yet on the Q Bytes list (and remember it’s FREE!) you have a second chance, because we will send out this link again on Saturday. Read on for more details…

The $787 billion approved in February was not enough, it seems! For example Laura Tyson, an  adviser to President Barack Obama, is quoted by Bloomberg as saying it was “a bit too small.” See also this link about Gold Price Speculation.

As I seem to remember there have been quite a few stimulus deals already…  so where somebody got the idea that this is only the second, I don’t know. But anyway, the chatterers are asking for a “Second Stimulus.” Whether this craziness actually goes ahead or not, it is once again highlighting the potential for decline of the dollar – and the consequent rise in Gold.

I see inflation as the most imminent threat to your capital. Allow me to explain. The Monetary Base is made up of currency in circulation, reserves that banks have on deposit with the Fed, and (last but not least) Federal Reserve Notes (FRNs)  stashed away in bank vaults. This is themoney used in our daily transactions, and as such is the most accurate indicator of inflation.

Between 1960 and 2008, the Monetary Base grew at roughly 6% annually, with a spike around 15% just before the turn of the century. But get this: Between September 2008 and April 2009, the Monetary Base exploded to a 110% growth rate. That means cash available to do business more than doubled in the space of just eight months. And since April… well, you get the idea!

With this level of liquidity, prices have to start rising in a big way. In fact, market guru Marc Faber says he is sure that U.S. will soon go into hyperinflation. Meanwhile other experts suggest that the UK is equally on the edge of a serious currency crisis.

What does all this mean? One short, four letter word:  G O L D ! We’ve written many times about Gold and Precious Metals Investing generally, and more specifically in our Members Section about how to buy and hold gold bullion offshore for the ultimate privacy, hedging and completely legal non-reportability.

But today I am not writing about Gold Bullion. While gold is slow, steady and relatively conservative… there is a way to leverage gold investments and make a lot of money very quickly when the gold price soars. I’m talking of course about gold mining stocks. And right now there is a very interesting opportunity that has come my way, from a couple of highly reputable people, both industry insiders, that has a very high potential upside. It’s interesting because it has two upsides… not just the leverage on the soaring gold price, but the fact that it’s currently undervalued and this is a chance to get in on a new gold find at the ground floor.

It’s not every day that the biggest gold find in Canadian history goes on record! But that’s what’s about to happen.

So I believe the time is right to introduce you to a contact who has all the inside information on it… an veteran ‘hands on’ investor of the Canadian mining business. I named him to Q Bytes readers in an email this morning, but will decline to name him in public here.  Suffice to say, if you missed out you still have a chance. Get on our Q Bytes list by midnight Friday, and I’ll make sure you get this information on Saturday.

He is going to tell you a great story… about a “renegade geologist” and his “mom-and-pop” company who are right now sitting on a mother lode of 10.6 million ounces of gold on their mining property. It’s soon going to go on record as the biggest gold find in Canada… the seventh largest in all of North America.

Now I’d like to point out, to those people out there who want everything for free, that good, hands-on type research costs money (just look at my travel bills each year…) So I’m not saying I’m going to give you all the insider research and contact information you need to take advantage of this deal for free. But Q Bytes readers will have the opportunity to read this story and get full information and insight on how this could work,  and very importantly how you could make money in short order. We mailed some info to our readers today, and we will repeat the relevant links on Saturday, to anyone whois a current Q Bytes reader as of midnight tomorrow Friday.  And Q Bytes is completely free and without any obligation whatsoever. You can sign up to Q Bytes here. Don’t miss out!