How Do Scammers / Money Launderers Profit From Loans To Victims
"What was the true reason they wanted to use my accounts for? We wouldn't know the true reason. The scammer can do multiple things. What exactly he would do in your case ... I am very eager to know what a person was up to who would give to me so much information about themselves. I know some of you will jump on the chance to yell ""it was not their true address"", but.... it is where they wanted me to send the cards to. And I was to give proof of my identification ie; a copy of my drivers license, my articles of incorporation and the real estate development project prospectus. Also they were only willing to work with certain banks ie; Citibank, Bank of America etc. I can not understand what they were doing wanting such access to accounts that had no money in them save the amount I used to open them with. It looks more like they would open accounts under your name, but they would be controlling the accounts. i.e. what goes in and out. i.e. they would be able to deposit and withdraw from a new account they set-up. They would want to use this account for illegal activities, so that if caught, the account opening paper trail leads to you. Even if they gave you an address, it could be rental. Like they have copies of your Company registration and ID proofs, they can use these to get another rental property ... and then send letters to some and ask them to met there." If they have your account numbers (which are necessary for direct deposits) they could possibly initiate ACH withdrawals from your accounts too (requires some setup but they may have accomplices). Note that even if you didn't have money there, depending on the local bank rules you may be still on the hook for overdrafts they create, at least by default. You may be able to prove later that this was fraud but the burden of proof will be on you, and in the meantime they might be gone with the money.   They could use your documents to either establish other accounts in your name (identity theft) or take over your accounts (e.g. by contacting customer service of the bank and claiming to be you, and presenting the documents you sent as a proof), request credits under your identity (possibly using the money on the account as a collateral since the bank may not know where the money is from), etc. This is even easier given you will give them all the documents and information needed for a loan, your signature, etc.  And the fact that they ask you to send documents to a specific address doesn't mean they could be found at that address when the problems start - it may be rented short-term, belong to either knowing or unknowing accomplice, be a forwarding service, etc. Could be money laundering of course too. That's just what comes to mind after a short while thinking about it.
People put conditions on donations all the time. They donate to the Red Cross for a specific disaster. The donate money to a church for the building fund. They donate money to a hospital to buy a new x-ray machine. They donate money to the scouts for a new dining hall.  It is possible to donate money to a non-profit for a specific purpose. If the non-profit doesn't want to accept the money with those strings they can refuse. Generally these specific projects are initiated by the non-profit. But there is no requirement that the idea originate with the non-profit.  It is also up to the non-profit and their legal advisers regarding how strictly they view those strings. If you donate money for web design and they don't spend it all, can they pay net years hosting bill with the money, or must they hold it for a few years for when they need a designer again? If the company wants to provide the service, they can structure the project to pay their employees for their time. They pay employees for $100 of labor while deigning the website. The pay and benefits reduce profit thus lowering taxes.  Donating money to the non-profit to be given back to the company doesn't seem to be the best way to structure transaction. At best it is a wash.  Donating money to a charity and then directing exactly which contractor will perform the service starts to look like money laundering, and most charities will get wary. "Most folks would loan out money for the purpose of being re-loaned.  Depositing money in the bank, is loaning the bank money who will re-loan it.  Buying bond based mutual funds is another way that it could be viewed that people are loaning money for the purpose of the money being re-loaned.  The reason why banks always have money available for withdrawal, is because of the reserve.  Fractional reserve banking in its simplest explanation, is that banks are allowed to take deposits and loan them out so long as they keep a set reserve.  If the reserve rate is 10% (it's really much lower), and somebody deposits $100, then the bank is allowed to loan out $90, keeping $10 as a reserve.  Now even with a reserve, a bank does run some risk of the deposits being withdrawn faster than the loans are paid back, this is called a run.  What protects banks most from this, is that deposits, withdrawals, loans, and loan repayments, all happen at a fairly steady and predictable rate (short term), so banks are able to judge how many loans they should give out.  Even when banks do see their reserve depleting, they have options.  The first and most common, is simply getting a loan from another bank.  The rule with the reserve, is that banks need to meet it at the end of the day, so banks will loan each other money overnight for the purpose of making up for the slight fluctuations that occur in a normal business day.  If you have ever heard the Fed talking about the ""overnight rate"" they are talking about the rate banks loan each other money for the night.  Another common way for banks to make up for a deficit in deposits, in a longer term solution,is to sell assets.  Fairly rare for a bank to sell actual physical assets, but the loans they hold are assets, and they can sell them to other banks.  Most banks will also hold some bonds that are available to sell.  The major functions that allow a bank to be profitable would still apply to the OP's idea.  The only real difference would be that commercial banks have direct access to the central banks, and the OP's idea would need to have a commercial bank to act as the middle man between the central bank." It will depend on how much you expect to earn this way, and whether you expect the company to become profitable soon. Has the company just not made a profit yet, or has it actually made a significant loss that your invoices would just be offsetting? If you're earning over £10,000 per year then invoicing through the company is preferable. Above that level, you'd be taking money from the company as dividends after paying 20% corporation tax with no other tax to pay on your personal tax return. As a sole trader you'd be paying 20% income tax and 9% NI. (Note however that the company can only pay dividends from profits, which is a problem if there are significant losses to offset.) Below £10,000, there's little difference. Through the company, you can take a salary of £7956 per year without paying any income tax or NI. With the new £2000 discount on employers' NI you could then take salary up to £10,000 and just pay 12% employee's NI. As a sole trader, you pay 9% Class 4 NI over £7956 and a fixed £143 per year for Class 2 NI. Paying 9% rather than 12% saves you £60, but then you add the £143. In practice the company would work out more expensive at this level because you'll probably want to pay an accountant to deal with the payroll for you. Having the company repay your £2000 from the invoices doesn't really save any tax if the company will become profitable in the future. You don't pay any tax now since the money you receive isn't income, and the company doesn't pay any tax if the extra £2000 of revenue doesn't put it back in profit. However, if the company is profitable next year then it will have an extra £2000 of profit that would otherwise have been offset against this year's loss, and you do end up paying 20% corporation tax on the £2000. You could still have the company repay the loan in order to delay the tax liability, but it's not really tax free money. Loaning additional money to the company has no tax benefit, you just give the company £1000 and get your original £1000 back later. You pay no tax and neither does the company, but it was your money in the first place. Since there was no sale, where does the money actually come from? From the refinancing bank. It's a new loan. How does a bank profit from this, i.e. why would they willingly help someone lower their mortgage payments? Because they sell a new loan. Big banks usually sell the mortgage loans to the institutional investors and only service them. So by creating a new loan - they create another product they can sell. The one they previously sold already brought them profits, and they don't care about it. The investors won't get the interest they could have gotten had the loan been held the whole term, but they spread the investments so that each refi doesn't affect them significantly. Credit unions usually don't sell their mortgages, but they actually do have the interest to help you reduce your payments - you're their shareholder. In any case, the bank that doesn't sell the mortgages can continue making profits, because with the money released (the paid-off loan) they can service another borrower. If the question is where banks get the money used to pay interest they owe: they do so by lending that money to us at a higher interest rate. They make a gross profit from the interest we pay, they pass part of that to their depositors as interest, part of it goes to service their own debts, part of it may go to stockholders as dividends, and the rest is net profit. Please do give an example that offers 50% returns. If it is rigged and you are successful, then are you not suggesting that you are personally involved with the rigging?   I mean, I'd love to believe you, but your cringe worthy writing makes me doubt that you're such a high level player. For stocks, I would not see these as profiting at the expense of another individual.  When you purchase/trade stocks, you are exchanging items of equal market value at the time of the trade. Both parties are getting a fair exchange when the transaction happens. If you buy a house, the seller has not profited at your expense. You have exchanged goods at market prices. If your house plummets in value and you lose $100k, it is not the sellers fault that you made the decision to purchase. The price was fair when you exchanged the goods. Future prices are speculative, so both parties must perform due diligence to make sure the exchange aligns with their interests.  Obviously, this is barring any sort of dishonesty or insider information on the part of either buyer or seller. Car dealers as well as boat dealers, RV dealers, maybe farm vehicle dealers and other asset types make deals with banks and finance companies to they can make loans to buyers. They may be paying the interest to the finance companies so they can offer a 0% loan to the retail customer for all or part of the loan term.  Neither the finance company nor the dealer wants to make such loans to people who are likely to default. Such customers will not be offered this kind of financing. But remember too that these loans are secured by the asset - the car - which is also insured. But the dealer or the finance company holds that asset as collateral that they can seize to repay the loan. So the finance company gets paid off and the dealer keeps the profit he made selling the car. So these loans are designed to ensure the dealer nor the finance company looses much. These are called asset finance loans because there is always an asset (the car) to use as collateral.