With back-back loans, two parties, each in another country, lend each other money to hedge against foreign exchange risks. They are also called “parallel loans.” One of the advantages of loans in return is the coverage in strictly necessary currencies. Only the major currencies operate in futures markets or have sufficient liquidity in the treasury markets to facilitate the efficiency of trade. Back-to-back loans are the most common for currencies that are either unstable or act with low liquidity. High volatility in such trade creates an increased need among companies in these countries to reduce their foreign exchange risk. The company and the bank agree on a one-year loan term and an interest rate of 4%. At the end of the loan period, the entity repays the loan at the fixed rate agreed at the beginning of the loan period and thus insures the foreign exchange risk during the term of the loan. Another example would be the financing of Canadian companies through a German bank. The company is concerned about the value of the Canadian dollar, which is changing against the euro. As a result, the company and the bank create a return credit at the cash register, with the company paying one million cad to the bank and the bank (which uses the deposit as collateral) giving it $1 million based on the current exchange rate. In tracking loans in return, the main problem facing companies is the search for counterparties with similar financing needs. And even if they find suitable partners, the conditions desired by both parties may not match.

Some parties will use the services of a broker, but then the brokerage fee will have to be added to the cost of the financing. Back-to-back Loans: A Fraud in Transition, Johnson, R. (2000). Back-to-back ready: A changing scam. Australian Accounting Review, 10 (22), 62-72. The case law on the detection of fraud by an accountant has identified three categories of fraud: “ingenious”, those that are supposed to arouse or arouse the suspicions of the legal auditor of accounts and “known fraud”. This paper argues that the extensive publicity granted by Bond Corporation in 1988/89 to take $1.2 billion from Bell`s resources led to the ingenious transformation of this fraud from transform to transfomed.