UNDERSTANDING THE RULES OF THE ROAD (FOR PPP)

None of the customary standards and practices that apply to normal, conventional business, investing and finance applies to private funding programs.


It is a “privilege” to be invited to participate in a Private Placement Transaction Program, not a “right.”


The trading administrators and managers have a virtually endless supply of financially qualified applicants. All things considered, the trading administrators and their banks will favor the applicant who provides the best paperwork. An applicant should never underestimate what the trading entities knowledge about him. Failure to provide full disclosure will disqualify the disingenuous.

Clients must first prove that they are qualified, not the other way around. Until the client is accepted by Compliance, the Traders, and Trading Banks, no placement can occur. The U.S. Patriot Act has introduced obligatory compliance procedures.


Face‐to‐face interviews with compliance officers and program management are occasionally required, but generally not necessary. Any arrogant or demanding personality will guaranteed to be rejected. Only the principal owner of funds is required as signatory. Corporations must empower an Officer or Director as sole, exclusive signatory by using a Corporate Resolution. Not only do the funds have to be on deposit in an acceptable bank; they must also be in an acceptable jurisdiction.


It is felony fraud to submit documents or financial instruments that are forged, altered or counterfeit. Such documents are promptly referred to the appropriate law enforcement agencies for immediate criminal prosecution.


The practices, procedures and rules are determined by the U.S. Federal Regulatory Authorities, Western European Central Banks program management, licensed traders and trading banks. It is their decision whom to accept and whom to reject.


Contract terms, yield, schedules, etc., are made to fit their needs and schedules – and not the caprices or demands of the investors. This marketplace is highly regulated and strictly confidential, and absolute confidentiality by the investor is a key element of every contract. A client who breaks confidentiality will precipitate instant cancellation.


Finally, submission of the application documents to more than one management group at a time is termed “shopping”. If an investor “shops” he can expect that this fact shall be quickly disseminated and known among the program management groups who maintain close communication – and will then be accepted by none and rejected by all.

Steps for Applying to a Private Placement Program

This is a process which is critical to understand, but the problem is 99.9% of those in the private placement market have never closed a deal.  Unfortunately, this had lead to a market flooded with inexperience and misrepresentation.  Think about it, how can you accurately explain the process of a private placement transaction if you have never closed one?  Simple answer, you can’t!

In this article, we will overview the typical process to complete a private placement transaction, and most importantly, we will supply common obstacles that you may face along the way.

10 Steps to Private Placement Success

(1) The client provides a proof of funds and passport copy along with their compliance package

NOTE: Most of the assets that people try to apply with CAN’T be used for any REAL private placement program.  These include ITR’s (Irrevocable Trust Receipt), SKR’s (Safe Keeping Receipt), T Strips (Treasury Strips), junk bonds, asset backed bonds, hard assets, real estate, and more.  As you can expect, most of the applications at this stage are unacceptable, and fraudulent.

(2) Trade group submits application to the compliance department for review

NOTE: Within hours, most real traders will know if the asset and owner are legitimate.  Also at this time, the criminal background and origin of the funds are explored to ensure they are dealing with a clean applicant.  In addition, if the client has over 100M, real trade groups typically either know of the applicant, or have seen the person try to apply before.  There is a very small circle of real traders, so when someone applies with large assets, the word gets around rather fast.

(3) Client passes “due diligence”, speaks with the trader, and receives the contract

NOTE: Most clients have NEVER been involved with a legitimate private placement before.  With that being said, many will show the contract to their attorneys, who have never been through this as well, and they may advise against proceeding due to a lack of familiarity.  Needless to say, this can kill the deal, or may make the PPP investor feel uncomfortable.  The problem you will run into over and over at this stage is transparency, and gaining trust from the client.  due to the private nature of the private placement business, there is only so much information the trader can reveal, and this is a common obstacle.

(4) Client signs the contract, and then the trader countersigns it to make it official 

NOTE: Once the client signs the contract, there are still a number of potential obstacles before you can “close the deal”.  If a client signs the contract and does not complete the transaction, they may be reported to the authorities, and by doing so, they will be permanently prevented from participating in any private placement program in the future.  As we said before, there is a small circle of real traders, and if they label a potential client as a non-performer, it is rare that any other REAL trader will spend their time to work with them.

(5) Client contacts their bank to complete the private placement transaction

NOTE: Banks are in the business of making money, and customer requests are secondary to the profit of the bank.  When a client asks to block, conditionally assign, or transfer their funds, they are cutting into the pockets of the bank, which we know they don’t stand for.  If the bank loses that asset off their books, they actually lose over 25x that amount in potential loans from their country’s central bank (FED/ECB).  With this in mind, most banks stall with excuses, since that will frustrate most customers enough to kill the transaction.  Even though this may be an obstacle, this should never be a deal killer since it is the client’s money, not the banks.  To complete a deal, you either need a bull personality or a great relationship with the bank, otherwise you may encounter problems with the final steps.

(6) Client’s funds are blocked, conditionally assigned, or transferred to the trade group in accordance with the contract

NOTE: Very few trade groups request that the client transfers ownership of their assets.  If they do request this, be very cautious, and expect something is not as it seems.  Most private placement traders ONLY need a conditional assignment of assets, temporary beneficiary access, or the blocking of the assets in their favor for the period of the trade.  This allows them to access a line of credit which they trade for the client, specific to their contract agreement.  Also, so you know, PING programs are 99.9% fake, since they do not allow the trader to access the line of credit they need to start trading.  No bank will loan without collateral, and since “PINGING” the account is not sufficient assurance to the bank that is has collateral in place, it never works.  It is just another ignorant broker creation and is most often part of a “bait and switch” strategy.

(7) Trader accesses the line of credit from the trading bank

NOTE: The trader is the only one who can access a line of credit against blocked assets.  No one who is trying to complete a scam will ever be able to draw a huge line of credit on blocked assets.  The bank completes thorough due diligence on anyone it loans to, and when that loan involves millions of dollars, it is far more diligent.  In short, no bank will offer a line of credit for millions to someone who they don not thoroughly trust, so there is not a lot of worry about when blocking assets in someone’s favor.

(8) Trader uses line of credit to have discounted bank instruments issued from bank

NOTE: First, the issuing bank sells the instrument directly to the trader for a significant discount (ex. 60% of face value).  After the trader buys the instrument, they then sell it to the “commitment holder/exit buyer” (ex. 66% of face), who then sells it to their “commitment holder” for a higher price (72% of face).  This continues until someone purchases it with the intent to hold the note to collect the coupon/interest, and the difference between the discounted note and its value at maturity.  This is the basic idea of how profit is generated in Private Placement Programs that use bank instruments.

(9) Client receives payment of profits weekly or according to the contract

NOTE: Once everything it set up with the banking, it is a very smooth process to get continual profits into your account.  Typically the first payment is made within 10-15 banking days after trading has started so they can ramp up the account to purchase larger notes.  After the first payment, the client will receive disbursements on a weekly basis, or whatever their contract specifies.  Most clients and brokers would be best served in setting up international bank accounts, or better yet, they can have an account at the bank where the trading is occurring.  This will prevent the need to send external wires through different countries and banking systems.  All profits would be internally transferred “ledger to ledger”, and would not attract as much attention.

(10) Client uses profits to fund projects and retains the rest for personal use

NOTE: Most real private placement programs are intended to fund humanitarian projects in underdeveloped nations.  Typically 60-70% of the program’s profits must go to projects, while the remaining 30-40% is for “administrative use”.  In essence, the 30-40% can be used at the client’s discretion, but you must make sure you are funding projects as well.  The platform does not regulate this, but the FEB oversees all of the companies who have applied and received money in these types of programs.

Once the client completes this 40 week trading process, they can re-enter, but they must have projects funnel the profits into.  Most private placement contracts are for 2 years, and are renewed upon expiration if both parties choose.

In summary, if you understand what we have described above you will know how to proceed with a private placement transaction, and be aware of how to overcome obstacles before they present themselves.  Though there are some programs which follow different steps, this is the basic template for all REAL private placement opportunities above 100M.

Private Placement Programs, Do they really Exist?

Private Placement Programs, Do they really Exist? 

Before we get the answer, let’s define the term “private placement program“. Through there are a number of different types of investments that are referred to as ” private placement”, such as pre-IPO fundign, managed Forex, equity investing, or organized investment pools, we are referring to the process of trading discounted bank instruments (MTN’s, BG’s, SBLC’s ) to generate high profits. This niche that has flooded with potential clients lately, but the question is, are any of these client ever successful?  read more …

Private Placement Programs and High Yields

Private Placement Programs usually get a very high yield when compared with the common yield reached with the better known traditional investments. The common man in the street cannot comprehend how one can obtain a high yield per week and feel it is only possible if you are a loan shark!
Way back in high school, I remember seeing a quote in the Reader’s Digest by an unknown person that “ignorance is a voluntary misfortune” and I think that applies aptly with private placement programs.
Remember, you cannot compare apples to oranges. Compared to traditional ways of investment and trading (especially in the stock market), these higher yields seem incredibly high to the average man on the street (even to some bankers), but they do exist and are being performed everyday by those in the know and of course, with the funds to be invited into private placement programs.

Investors and Private Placement Programs

Some think that the investors in private placement programs are the end-buyers in the chains we spoke of before, but this is not the case. Financially strong companies who are looking for safe investments for the long term are the actual end-buyers.
The end-buyers are made up of insurance companies, trusts, pension funds, etc. They are not allowed to participate in-between as investors.

The investor in a Private Placement Program is just a cog in the over-all picture among many others. So, who are the other players that are involved in a PPP? Well, they include the trading groups as traders/commitment holders, top world banks who issue bank instruments, intermediaries/brokers and of course, the exit-buyers such as pension-funds/insurance, etc., who get the advantage to benefit from this private placement program trading.

This sometimes causes some discomfort for an investor because he/she usually does not see most of those involved in the process because they will deal with brokers, trading groups / traders and trading banks only. Different clients have varying levels of comfort regarding their financial security in this kind of trading.
Investors are “invited” to participate only after they have submitted a full compliance package which includes a POF (proof of funds), CIS (client information sheet), passport copy, a brief summary describing the request, i.e the dollar amount, is it PPP or another service they request, the name of the client’s bank and is it cash or a bank instrument that he wants to put into trade? Also, in what country is the client and the bank located?
A lot of intermediaries/brokers and clients try to pester the trader or his representative with questions and want to go back and forth and get all of their ducks in a row before submitting their compliance package. Many have a rude awakening when they are told to go elsewhere. This often occurs with unsophisticated players who do not understand the protocol involved in private placement programs.
They just don’t give out details until you can show you are a real client. They are too busy helping the many humble and responsible people who are waiting in line to get into good trades to deal with multiple questions and difficult personalities and bad attitudes. Once they review the compliance package and it has passed their due diligence, the client will be invited to participate and full details will be revealed at that time. This does not commit the client to anything because he has not signed a contract. After a conference call, it is up to the client to move forward or not.

Private Placement Programs Structure

Normally, private placement programs are nothing more than a pre-arranged buy/sell transaction of discounted banking instruments using an arbitrage transaction.

If an investor had funds of say $100M to $500M, they could create their own trading program by creating for themselves the buy/sell transaction. That is not as simple as it sounds since he would have establish control of the whole process by making contact with the Provider banks for the bank instruments and at the same time for the exit buyers.
With all the FED restrictions they have to meet this is not a simple task, plus it is no easy feat to develop the strong necessary connections with the related parties in private placement programs (the issuing banks/providers for the bank instruments and the exit-buyers).
For an investor it is much simpler and usually more profitable to enter a program where the Trader with his Trading Group has already everything in place, such as the issuing banks, the exit buyers, the contracts ready for the arbitrage transaction, the line of credit with the trading banks and all of the necessary guarantees/safety for the investor, etc.) . This way, the investor needs only to agree with the contract proposed by the Trader forgetting about any other underlying problem.
Another advantage for the investor/client is that he can enter a private placement program with a substantially lower amount of money against the case to proceed by himself because he will take indirectly advantage of the line of credit of the Trading Group.

Trading Guidelines For Private Placement Programs

1. Few of the rules applicable to other businesses apply to private placement programs. You success has little to do with what you know and just about everything to do with whom you know.
2. It is a privilege to be invited to participate in a private placement program, not a right. Traders can easily maintain a constant supply of previous clients and new applicants because of the high yields and negligible risk. If the trader does not receive a complete compliance package, he will simply say….next!
3. Failure to disclose fully can disqualify the most earnest of applicants. And the traders have no obligation to explain to you or your client. You should never, ever underestimate what the traders know or can find out about the investor and the intermediaries’ prior efforts to get into the business. They will know if the client has been shopped around.
4. Most of these private placement programs exist in order to finance humanitarian projects. Yes, they are lucrative to investors, but the purpose is not simply to generate more money for the already rich, but rather to encourage the re-circulation of idle money and place the funds where they can help the most. Clients with their own projects, and clients willing to support
projects sponsored by the trading groups always move up in priority and get the better yields.
5. Remember to let your client know that they need to prove their qualifications to the trading groups running the private placement programs not the other way around. Compliance officers and traders will not go back and forth with intermediaries and/or clients until after they have received a complete compliance package consisting of a passport copy, CIS (client information sheet) and proof of funds (POF), which can be sanitized to protect sensitive info.
6. A personal interview is usually required with the principal even when the principal has given a POA (power of atorney) to a mandate. Traders must know with whom they are dealing. Many people do not get past the interview stage, because of unrealistic demands or attempts to negotiate terms that have already been fixed by regulators and banks. And from personal experience I can tell you that language barriers can be a big pitfall. As I write this, we have an intermediary in India with three clients who we have ready to go into trade as soon as the intermediary can find a qualified translator. The intermediary blew the first conference call and if he does not find a good translator, the trader will discard their files very quickly!
7. Only actual owners of the funds or account signatories are recognized by the trading bank or
depository and considered principals.
8. Funds must be in a first-class bank and normally, must have a branch in an acceptable Western jurisdiction. Many traders want funds moved to the transaction bank (under the owner’s control). It is always on a case by case basis.
9. Client and intermediaries for private placement programs should realize it is illegal to propose assets or submit documents that are fraudulent or forged. Illegal submissions are immediately reported to the authorities.
10. Funds (assets) must be screenable in, or confirmed by a top Western Bank. One must have clear legal title from the owner to submit an asset by way of assignment (i.e. bank-acknowledged power of attorney or a corporate resolution).
11. Real private placement program trading groups will not publish write-ups or quote specific yields, except in direct meetings with principals – otherwise, their privileges could be suspended. Neither do they float “contract” forms through intermediaries. Unfortunately, many intermediaries think they can run the process and this IS NOT the case. The job of the intermediary is to collect the full compliance package, submit it and then step back and let the compliance officer and trader run the show. To do otherwise will cause the client not to be accepted and may actually result in them being blacklisted and they will never get into a program, anywhere.
12. Genuine private placement programs do not ask for up-front fees. And the client’s funds are rarely out of a principal’s control – except with a valid undertaking from a major bank or approved equivalent.
13. Programs, yields and rules are in a constantly state of flux because they are influenced by market pressures, government regulations and other factors beyond the control of the
particular private placement group. Investors must follow the traders’ rules and expect to get the details of the offer upon presentation of the contract by the trader or discussions
leading up to that point.
14. Private placement programs are highly confidential and “deniable”, because of its obvious
potential for disrupting other markets. Inappropriate demands, “shopping” an asset and other indiscretions can result in a client or intermediary being “flagged” as a problem and excluded, even without their knowledge. Once blacklisted, you are done in the private placement program field.
15. And yes, client profits are subject to tax accountability to government authorities and to
society as a whole. Genuine traders will never aid, abet or be privy to any form of evasion. Proper tax management and legal avoidance by the client, on the other hand, are perfectly acceptable and are the responsibility of the client.

NON-SOLICITATION AND NON DISCLOSURE and Private Placement Programs

As a direct consequence of the environment where this business has to take place, a Non Solicitation regulation has to be strictly followed by all of the involved parties.

This element of private placement programs strongly influences the way the parties can deal with each other and the way they can make contact. This fact can sometimes be also the cause of the origin of scams (or attempts to do so) due to the fact that at an early stage it is often difficult for the investors to realize if they are really in contact with a viable source.

Another reason why so few experienced people talk about these trading programs is because just about every contract involving the use of these high-yield instruments contains very explicit non circumvention and nondisclosure clauses which forbids the contracting parties from discussing any aspect of the transaction for a period of years. So, it is very difficult to locate experienced contacts who are both knowledgeable and willing to discuss openly about this type of instrument and the profitability of the transactions in which they figure.
Private placement programs are a very highly private business, not advertised anywhere nor covered in the general press, and they are not open to anyone but the best connected and most wealthy people that can come forward with substantial cash funds for trading.

How Banks and Brokers Can Earn With Private Placement Programs

Banks are not permitted to act as investors in private placement programs, but they are able to profit from them indirectly in various ways (firstly getting big commissions).
This fact permits some private entities like private investors, brokers and trading groups to take part in this lucrative business that otherwise would be a banking matter only.
The private assets coming from private investors are necessary to start the private placement program process. These private large cash funds are the mandatory requirement for the buy/sell transactions of banking debt instruments and, as a consequence, also the mandatory requirement for the programs through the Trading Groups. Brokers/intermediaries are necessary to introduce the investors to the Trading Groups that exist.
Because of this, each of the involved entities share the benefits of these private placement programs (commissions for banks/brokers and proceeds for Trading Groups and investors).