SBLC Project Finance Loan Scams: The Advance-Fee Trap
SBLC “Bait” Scams in Project Finance: The Advance-Fee Trap
Every month we hear from sponsors who signed a loan agreement with a little-known “funder” promising a Prime-Bank Standby Letter of Credit (SBLC) that will magically convert into a non-recourse loan. They paid a five- or six-figure “leasing” or “discount” fee, received a PDF that looks official—and nothing credited to their account. Below we unpack how the fraud works, why genuine SBLC issuance cannot bypass underwriting, and what to demand before parting with cash.
Typical Scam Sequence
| Step | Scammer Pitch | Reality |
|---|---|---|
| 1 — Approach | “We issue a $200 million Prime-Bank SBLC in two weeks—no collateral needed.” | Prime banks require cash or marketable assets from their client before issuing an SBLC. |
| 2 — Fee Demand | “Pay 7 % leasing fee up front; balance converts to a loan.” | Fee goes straight to the scammer; no standby credit line exists. |
| 3 — Bank Comfort | Victim asks home bank, “Can you receive a Prime-Bank SBLC?” Bank says, “Yes, we receive all confirmed instruments.” | Answer refers to genuine SBLCs—scammer weaponises the ambiguity. |
| 4 — Fake Delivery | Victim gets a PDF MT-760 or “Swift Screen” with typos and no secure key message. | Home bank cannot authenticate; SBLC never hits SWIFT network. |
| 5 — Excuses | “Manual download required; pay courier, compliance or tax first.” | Delay tactics drain more fees until victim walks away. |
Why Real SBLCs Require Rigid Underwriting
- Balance-Sheet Exposure: Issuing bank books the SBLC as a contingent liability against capital ratios.
- Collateral Backing: Cash, high-grade securities or a borrowing-base line cover 100 % of face value.
- KYC & Source-of-Funds: Banks must evidence the origin of collateral under AML rules.
- Pricing Transparency: Annual commission 0.75-2.0 %, not 7-20 % “leasing” discounts.
- Delivery via SWIFT MT-760: Secure key codes allow receiving bank to verify in seconds—no PDFs, no “screenshots.”
Red Flags—Every Time
- Issuer is a non-bank finance company in a secrecy jurisdiction.
- SBLC amount far exceeds issuer’s stated capital.
- Up-front “leasing” or “discount” fee over 3 % of face value.
- Issuance promised in under ten business days without due diligence.
- Proof of funds offered as a PDF—no live SWIFT authentication request allowed.
Legitimate Paths to Project Finance
• Developer Equity + Bank Debt:
20-40 % equity, senior construction loan, and—where needed—bank-issued SBLCs backed by pledged cash.
• ECA & DFI Support:
Export-credit guarantees reduce lender risk and margin.
• Tax-Equity or Green Bond Tranches:
For renewables in OECD markets.
• Placement Agents & Boutique Investment Banks:
Arrange syndicates, charge retainers to cover modelling, legal and compliance work—not advance fees for fantasy instruments.
Need a standby letter of credit that clears both banks’ compliance desks? Send your project model and collateral plan. Financely structures genuine SBLC facilities and connects you with investment-grade lenders—no shortcuts, no ghost funds.
Secure a Genuine SBLCFinancely Group arranges credit through regulated institutions. We do not endorse, broker or review leased-SBLC or monetisation schemes. Engage qualified legal counsel before paying any advance fee for an unsolicited funding offer.
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