Iraqi dinar: Safe investment or scam?

Posted: Updated:
Old Iraqi dinar featured Saddam Hussein By Meredith Yeomans Old Iraqi dinar featured Saddam Hussein By Meredith Yeomans

PHOENIX -- Saddam Hussein may be long gone, but controversy over his currency is going strong.

It all has to do with Iraqi dinar investment offers.

Felicia Thomspon with the Arizona Better Business Bureau says it's seeing a surge in them, most of which turn out to be scams.

“A scam artist's job is to make sure that they're very convincing and they do anything they can to get you to buy into whatever they're selling,” she said.

Here's how the offer works:

A dinar dealer contacts you telling you now is the time to buy dinar while the value is low. It’s estimated that 1,000 dinars equals $1.

But the dealer assures you when Iraq's economy turns around, the dinar will appreciate and your investment will pay off big.

“A lot of times you'll see they're making claims the Iraqi dinar will be worth ‘xyz’ two years from now, so they're making predictions that they can't verify, they can’t vet and folks are falling for it, unfortunately,” Thompson said.

Right now, there is no way to verify exchange rates for the dinar because banks don't even use it. So, you can buy dinar, but you really can't sell them.

In return for your so-called investment, Thompson said you may even get old dinar, which still had Hussein’s face on the bills.

Some would consider it nothing more than a collector’s item since it hasn't been used in Iraq since 2003.

But Thompson said scammers won't tell you any of that. Instead they promise big profits, even religious and charity affiliations, all to get at your money.

“So, we're seeing a lot of religious affiliations, charitable attachments connected to these claims that are really appealing to people's heartstrings,” she said.

The BBB also warns most of these investment marketers aren't registered with the U.S. Securities and Exchange Commission, which makes what they're doing illegal.