​A man who posed as the chief compliance officer of Manhattan's fictitious 'Dominion Bank and Trust Co.' has pleaded guilty to participating in a US$4 million fraud scheme.

Gerald Shaw, a disbarred attorney and convicted felon, was involved in drafting various fake documents, including standby letters of credit (L/Cs), which were sent to victims in exchange for payments. The fake documents aimed to convince potential victims that the bank was legitimate.

L/C fraud

Central to the deception were fabricated financial instruments, notably counterfeit standby L/Cs, which Shaw was responsible for drafting. The L/Cs were then presented to victims as legitimate financial guarantees.

The standby L/Cs were used to lend credibility to the scheme, persuading victims to part with their funds under the pretence of receiving financial services from a reputable institution.​

False representations

As part of the fraud, Shaw and his associates instructed victims to wire tens or hundreds of thousands of dollars to Dominion Bank as a deposit or servicing fee for future financing or credit based on representations that Dominion Bank could provide certain services.

Those representations were false. In fact, no financing existed; the victims did not receive the promised credit; and the victims were generally unable to get their money back, as Dominion Bank typically did not return funds to victims.

Instead, the bank kept victims' money and, in some instances, even responded to refund requests by sending invoices for additional amounts. Dominion Bank defrauded at least approximately 60 individual and corporate victims in total out of more than US$4 million.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.