Shortfall Guarantee Investment

[Jim Belcher]

Hey guys...I'm new in here. I have been asked to become part of a group of developers who develop on a large scale basis ($500MM +). My job, according to them, is to find investors who want to invest in a "shortfall guarantee". They are tellng me that basically the investor puts up a certain amount of money which is placed in a world center bank. This bank uses the investor's money as equity injection into the financing of the development. The developer is telling me that the return to the investor is a 40% premium within 60 days of the investment. So, at the end of the 60 days, the investor will get a check for his original money back plus another check including his 40% premium. If financing takes longer than 60 days, then they become the sole beneficiary of a large trust acct. which is housed at that bank which they can invest how they wish and receive the interest from this acct. They say that this investment is guaranteed by the world center bank through an irrevocable pay order issued by the bank as well as the trust acct. The developers say they can offer the investor this type of premium because the bank is using the investor's money to allow themselves to be able to borrow more money from the federal gov. to loan out to others needing loans. They also say that the bank is making money off of the investor's money because they are investing it themselves. I was asked to become a part of this project because of the contacts that I have. I own a commercial mortgage brokerage firm. I'm asking you guys if anyone knows if this "Shortfall guarantee investment" is legitimate. I don't want to involve myself in something that could be a possible scam. Can anyone tell me if they have heard of this before and if it is illegal or not???? I would really appreciate your help on this one!