Warns Consumers of Promissory Note Scam and Yanks Agent's License Superintendent of Insurance Neil D. Levin today announced the revocation of insurance agent Tiber Tomshaw's license for the illegal sale of securities and issued a warning to New York consumers concerning the sale of fraudulent promissory notes in New York State. The sale of fraudulent promissory notes continues to be a nationwide problem that often targets elderly consumers and promises high profits for their risk free investment. Tomshaw had sold these securities in the form of promissory notes between April 1998 and January 1999 without having a license to sell securities in the State of New York and the issuers of the securities had not filed the required registration statements with the State Department of Law. Tomshaw misrepresented information to his clients to convince them that the promissory notes were financially sound and safe investments and based on his recommendation, his clients withdrew funds from IRA accounts, annuities, life insurance policies and other secure investments to finance the purchase of these promissory notes.
Promissory notes promise a high rate of return of interest over a short period of time.
A company borrows money by selling those notes and promises to pay it back quickly with interest. Both the seller and the buyer of promissory notes need to be financially strong enough to handle any risk.