I want to make a loan offer to a potential client.
I submitted my term sheet including a description of the collateral to company X who deals in bank instruments.
They told me they are RWA to fund it on the basis of a SBLC fully cash thru their support US bank.
In order for them to commit I am required to send them my letter of intent in my company letter head and return it for study and due approval.
They will then issue proof of funds and its verifications will be done using normal confirmations (MT760?), to serve as letter of credibility for me to forward to my client.
The cost for the assets cash blocking is €100,000 and for the account of the beneficiary name of the issuance. It has to be paid within 48 hours after confirmation.
They tell me if the loan funding is awarded to me, the funds cash assets will be blocked in my clients projects beneficiary details and I will have the comfort of a signed contract for the project with my client who will commit security directly to me (frankly I am not sure why).
Within 72 hours after confirmation by my client the funds can be
available to him.
It seems to me that the economic rationale for this transaction is present because I have a potential client who is willing to give collateral and company X seems to have an investor who agrees with the term sheet and is willing to invest. Company X is also offering to perform using international bank procedures.
I anticipate that if this is a scam, it must come in the form of one or more clause in for example the MT760 which make it impossible to collect the cash needed for the loan. For me to avoid being scammed this way I simply have to work with a very seasoned lawyer/expert, who under ideal conditions should participate in the risk of funding the cost of issuing the blocked assets.
Another point that is unclear for me is if company's X offer is legitimate, am I expected to take the SBLC they arranged to my local bank to get a line of credit against it?
Why would the lender behind the SBLC allow my client (the borrower) commit the collateral to me?
I want to make sure I am not discarding a good deal.
After serious consideration, are you sure its a scam?