Companies must start to take more responsibility for the role they play in international trade or risk the same tough sanctions imposed on banks when money laundering threatened to spiral out of control.

This view, voiced by the International Maritime Bureau's Information Department, follows an in depth investigation that demonstrated the role currently being played by many small companies acting as intermediaries whose actions are being used by traders to perpetrate frauds.

"We found numerous incidents where small forwarders and shipping agents were asked by traders to produce documents that were used in fraudulent shipments to and from India, to the Middle East, and for road shipments into Russia," said Sammy Mwedekeli, head of the Information Department.

"What they did was not illegal and they were under no obligation to check out their clients; simply to allow their name and reputation to be used in conjunction with a trade via the documents they produced. But their actions do not take account of the broader picture and the impact it could have on international trade if allowed to continue.

"The fact is these documents were used to perpetrate fraud and many innocent third parties lost money as a result. These companies cannot close their eyes to a suspicious transaction with the excuse that they themselves are not doing anything illegal."

The IMB says the current situation owes much to the lack of accountability, combined with the rapid rise of many small intermediaries that have few or no assets. Such companies do not have the same duty of care when issuing documents, as they are putting nothing at risk. For them, it is simply a means of generating a quick income with no comebacks.

A similar situation occurred some years ago over the issue of money laundering and a bank's accountability for the actions of its customers. The intransigence demonstrated by many smaller banks at the time led to a complete shift in the balance of their responsibility and resulted in the imposition of a positive duty through money laundering legislation to conduct due diligence and report suspicious transactions to the authorities.

If international trade does not take steps to rectify the current situation, it may not be long before the authorities step in to regulate traders, freight forwarders and agents in the same way they have banks, by imposing both criminal and civil sanctions that severely restrict operations.

ICC Commercial Crime Services provided information for this article. They can be reached at e-mail: ccs@icc-ccs.org