A US jury has indicted a Missouri man for his role in a conspiracy to defraud approximately 120 investors of nearly US$3 million in a securities and wire fraud scheme.

Jack Calvin was the primary promoter of Growth Benefit Systems (GBS), which the indictment describes as a "sham letter of credit (L/C) trading programme.

Huge returns

The indictment alleges a fraudulent offering of unregistered securities in connection with GBS, the scheme promoted by Calvin. Several other people allegedly helped him perpetrate the fraud.

The L/C trading programme did not exist according to prosecutors who say the scheme, initiated by Calvin, raised approximately US$2.8 million by promising investors returns of up to 20 per cent per month.

Typical scam

Calvin and his co-conspirators apparently misappropriated virtually all of the money raised for their personal benefit.

The GBS L/C trading programme described in the indictment has the typical features of prime bank-type investment frauds.

No such thing

The programme purported to generate profits from trading L/Cs and promised exorbitant rates of return with low risk.

The prosecution in this case argues that Calvin's and his co-defendants' representations were false because such high yield trading programmes do not exist.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.