South African importers and exporters of bulk cargo are falling prey to fraud and also landing cargo that has been damaged in cases where consignees and agents have been misled or corners have been cut to save costs.
Shepstone & Wylie Attorneys head of international transport, trade and energy, Quintus van der Merwe, said in recent cases importers had suffered huge financial loss following fraud surrounding bulk cargo.
“People say they are shipping a specific material and a letter of credit is issued, however it won’t be shipped unless there is a form of payment. The problem arises when the bank makes payment, which it is contractually bound to do when it receives prima facie legitimate conforming documents such as a commercial invoice, certificate of quantity and quality, insurance certificate or the bill of lading. The bank makes payment but one or more of the conforming documents is fake, or the documents are correct, but a different cargo is subsequently loaded onto the ship,” Van der Merwe explained.
