How to Avoid the Scam

Safe keeping receipts can be deceiving. They give off the idea of being safe because they have the word “safe” in their name. In their original form, they really only give access to assets that have been put away for safe keeping. However, an investment market has sprung up over the years. In doing so, leasing safe keeping receipts has become prime ground for con artist to defraud investors. This is due to the fact that they are able to convince investors that their assets are “safe” due only to the fact that the word “safe” is in the name.

Leasing SKR can be a legitimate form of investment if handled properly. However, it is somewhat tiresome and not nearly as profitable or easy as other areas of investment. The trail begins when an owner of an asset desires to put that asset somewhere for “safe keeping.” Another option other than a safe deposit box is to take the asset to an institution that issues this types of receipts. These institutions take assets and put them away, issuing a document called a SKR to the owner. This receipt is only to prove that they are the owner of the property and it is the key to gaining access to the assets.

Over the years, these receipts have become negotiable instruments. This means that their ownership can be transferred. In doing so, access and therefore ownership of the assets are transferred. In this way, they can be monetized, turning them into legal tender. Leasing SKR is when the owner of the receipts accepts payments monthly for letting others use receipts as collateral. It gets very confusing, and this is what allows fraud to take hold. Those who do not understand how the receipts work can be easily conned.

The scam begins with a con man posing as a broker. He convinces the asset owners to issue a SKR and give him the power of attorney. He may also suggest that the owner get another safe keeping receipt on the original receipt. This does absolutely nothing but give the asset owner a false sense of security. The “broker” now has complete access to the asset, whatever it is. The theory is that he is to only access it for investment purposes, but as he is dishonest, this is likely not the case. To avoid a situation like this, check out a new broker thoroughly using every resource available.