Iraqi Dinar Scam

What is the Iraqi Dinar Scam?  The Iraqi Dinar Scam is the sale of Iraqi dinar to consumers believing a deceptive pitch that it can be sold in the future for a likely profit when the Iraqi dinar is revalued.  This deceptive pitch,  more than a mere one-liner, has evolved into a massive network of deception on the internet in which the consumer purchases dinar from a currency dealer which has built its website internet presence and appearance of credibility upon deceptive and misleading acts and omissions.  In many cases, the dealer has stolen content and images, and then used that stolen material to create web pages from which to build links back to the dealer’s website.  In many cases, the dealer utilizes fake press releases and fake social profiles of satisfied customers touting the dealer’s website.  It is also typical to see puffery and statements which leave out important information that a consumer should have in order to make an informed decision.  Feeding off this frenzy are websites created that discuss the supposed imminent reevaluation of the dinar.  All this material will then be linked together in a grand and deceptive network on the internet, creating an impression of legitimacy and respectability in reliance upon which, the consumer is induced to buy.

The dinar buyer must realize how simple it is to become a currency dealer of dinar, and how quickly a dealer can create a website that has the appearance of depth and integrity.  They must recognize that the government is not proactive in the regulation of this kind of complex, tiered network of deception, and search engines such as Google and Microsoft’s Bing, may not discover this deception before its too late.

Importantly, the dinar buyer does well to appreciate the plethora of laws that a currency dealer on the internet may be violating in a system that is largely unmonitored by the regulatory authority.  For example,

  • Title 15 of the federal statutory law, the United States Code, relates to commerce and trade and the public.  It protects consumers by preventing deceptive and unfair acts or practices.  The Federal Trade Commission has determined that a representation, omission or practice is deceptive if it is likely to mislead consumers and affect consumers’ behavior or decisions about the product or service.  In addition, an act or practice is unfair if the injury it causes, or is likely to cause, is substantial, not outweighed by other benefits and not reasonably avoidable.
  • Advertising must tell the truth and must not mislead.  A claim may be misleading if relevant information is left out.  Furthermore, testimonials and endorsements must reflect typical experiences of consumers, unless the ad clearly and conspicuously states otherwise.  Connections between an endorser and the company that are unclear or unexpected to a customer also must be disclosed.
  • Chapter 2A of Title 15 §77q(a)  provides that it shall be unlawful for any person in the offer or sale of any securities (the Iraqi dinar is a security) by the use of any means or instruments of transportation or communication in interstate commerce or by use of the mails, directly or indirectly  (1) to employ any device, scheme, or artifice to defraud, or (2) to obtain money or property by means of any untrue statement of a material fact or any omission to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; or (3) to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser.
  • Chapter 2B,§ 78j(b) provides that it is unlawful to use or employ, in connection with the purchase or sale of any security any manipulative or deceptive device or contrivance in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors.
  • Chapter 2D provides for prohibited practices by unregistered investment companies and advisors.  It is unlawful for them to make use of an instrumentality of interstate commerce, to employ any device, scheme, or artifice to defraud, or to engage in any act, practice, or course of business which is fraudulent, deceptive, or manipulative.
  • Websites that use copyrights and trademarks without authorization are likely to have violated Title 17, USC §§ 1201 – 1205 by circumventing a technological measure that effectively controls access to a work, as well as the federal law and common law relative to copyrights and trademarks of others.

Michigan law applies as well.

  • The Money Transmission Services Act, MCL §§ 487.1001 – 487.1047 prohibits a person from providing money transmission services without a license.
  • The Michigan Consumer Protection Act, MCL§§ 445.901 – 445.902 prohibits unfair, unconscionable, or deceptive methods, acts, or practices in the conduct of trade or commerce.
  • The Michigan Uniform Securities Act, MCL §§ 451.2101 – 451.2703 prohibits fraudulent practices in relation to securities and requires the registration of broker-dealers, agents, investment advisers, and securities.  MCL § 451.2501 provides that in connection with the offer, sale, or purchase of a security, it is unlawful directly or indirectly to (a) employ a device, scheme, or artifice to defraud; (b) make an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; (c) or engage in an act, practice, or course of business that operates or would operate as a fraud or deceit on another person.

We really don’t know what we are looking at when it comes to a website on the internet.  When considering a dinar dealer, know that they may be violating these laws in that its website is built upon stolen content, fake press releases, fake social profiles, fake reviews, puffery, and misleading statements and omitted information all contained in web pages and websites linked together in a grand network of deception for the purpose of creating an impression of integrity and transparency to induce a purchase.

When it comes to buying Iraqi dinar from an internet based dealer, in order to profit in the future, we should not only consider the substantive economic and political questions relevant to whether the Iraqi dinar will ever be revalued such that it is a worthy investment (no doubt, it is not!), but we should also know that what we are seeing on the internet is an illusion of smoke and mirrors used to create that dealer’s website internet presence.

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