I have often come across DC with the above stipulation, with a slight change here or there, like All discrepancies acceptable except in amount,some adding the words subject to presentations of all the documents called for.
to my mind no matter how you word the stipulation it is still fraught with risk for the issuing bank and ofcourse its customer, as it leaves a million & one options for the bene to defraud them.yet i have seen many issuing banks suggesting this particular stipulation to their customers,just so they wont have the responsibilty to check the documents and can safely pass on the risk to the applicant.
I would like to know how my learned friends view this malpractice of trade.
All discrepancies acceptable.
All discrepancies acceptable.
"ALL DISCREPANCIES ACCEPTABLE IF REQUIRED NUMBER OF DOCUMENTS ARE PRESENTED" USED IN FRAUDULENT DCS
From our experience in dealing with fraudulent DC cases, we had encountered DCs with terms and conditions like that in fraudulent DCs from Korea, where back to back DCs were used with all parties belonging to the same gang.
This time the request for such terms and conditions was from the applicant himself to make sure that the presentations would not be rejected. Certain senior managers in banks were taking benefits out of such arrangements, as disclosed by the affidavits. One senior bank manager defended that he was not breaking the law by accepting a loan from his customer to purchase his own house.
The frauds involved many big international banks and about 36 DCs were issued with amounts ranging from USD 1 million to 10 millions.
This could be seen as a SOLO case in Korea. This fraud case was uncovered a couple of years ahead of the famous SOLO case in the Middle East.
We are from http://www.tolee.com
[edited 7/19/01 9:28:26 PM]
From our experience in dealing with fraudulent DC cases, we had encountered DCs with terms and conditions like that in fraudulent DCs from Korea, where back to back DCs were used with all parties belonging to the same gang.
This time the request for such terms and conditions was from the applicant himself to make sure that the presentations would not be rejected. Certain senior managers in banks were taking benefits out of such arrangements, as disclosed by the affidavits. One senior bank manager defended that he was not breaking the law by accepting a loan from his customer to purchase his own house.
The frauds involved many big international banks and about 36 DCs were issued with amounts ranging from USD 1 million to 10 millions.
This could be seen as a SOLO case in Korea. This fraud case was uncovered a couple of years ahead of the famous SOLO case in the Middle East.
We are from http://www.tolee.com
[edited 7/19/01 9:28:26 PM]
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AbdulkaderBazara
- Posts: 256
- Joined: Fri Apr 05, 2019 5:15 pm
All discrepancies acceptable.
If all discrepancies are acceptable then why put the conditions or even why issue an LC. There is no point. Agree, these type of LC's could lead to fraud.
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larryBacon
- Posts: 689
- Joined: Fri Apr 05, 2019 5:26 pm
All discrepancies acceptable.
At present there is nothing to stop any of the 49 Articles being excluded from a DC. Thus, an issuing bank could exclude the provisions of Article 9, removing any risk of liability to itself.
It may be worth considering for a future version of UCP whether some of the Articles should not be permitted to be excluded. Similarly an automatic acceptance of discrepancies should not be permitted. This would not preclude acceptance of discrepancies by the applicant.
It may be worth considering for a future version of UCP whether some of the Articles should not be permitted to be excluded. Similarly an automatic acceptance of discrepancies should not be permitted. This would not preclude acceptance of discrepancies by the applicant.