Bank/Shipping company/Drawees collude. Is this fraud?
Posted: Fri Jun 01, 2001 1:00 am
A set of Export documents were sent from India by Bank of Maharashtra (BOM) to Commonwealth Bank of Australia (CBA) for collection under URC 522, The Export documents contained Original B/L's, Invoices 4 sets, Packing List 4 sets and Sola of Exchange 1st & 2nd The instructions to the collecting Bank CBA on the forwarding letter of BOM clearly states that the collecting Bank should:
1. Acknowledge Receipt of the documents and advise their Reference number.
2. Deliver documents against acceptance.
3. Advise by Telex/Swift Non-payment stating reasons.
4. Collect all their charges from Drawees.
5. In case of Non payment/Dishonour Please protest.
Tenor : 30 days from the Date of B/L.
It has been found that the collecting Bank (CBA) delivered the documents to the Drawee without any acceptance of the same on either 1st or 2nd Sola of Exchange.
The collecting Bank (CBA) on being charged by us of neglect/fraud/mishandling of the above documents have tried to hide under the pretext that: (We quote from the correspondence recieved by us from Commonwealth Bank of Australia.)
"Unfortunately it appears that the instructions to the Bank from Bank of Maharashtra were contained in an envelope addressed to the Client. i.e. within an envelope addressed to the Branch of the Bank. The branch did not open the envelope addressed to its client, it merely passed it on (as though it were a post office) and did not, as a result, know that the contents of the envelope contained the instuctions to act as a collecting bank or the bills of lading. The branch does not handle trade transactions - they are handled by a specialist central group within the Bank where all instructions should be addressed by remitting banks and it is known to them (the group has been in operation for a number of years).
Under these circumstances the bank could not "elect" to reject the instructions, because it did not know it had recieved any - it had handed them over to its client."
The Bank of Maharashtra has aggressively refuted the claim of an Envelope addressed to the Drawees in the Envelope addressed to the collecting Bank (CBA), also pointing out here that for any documents meant to be delivered to the client directly, they would use the services of the Post Offices or Couriers and not the services of the Bank.
Under the above circumstances it is assumed that the collecting bank (CBA) and the Drawees are hand in glove with each other.
On enquiries with the Shipping company with regards to this consignment, it has been found that the Original B/L against which delivery has been taken by the Drawees has not been Endorsed/released in favour of the Drawees by the Commonwealth Bank of Australia who are the Consignee on the B/L. The Drawess are the Notify Party. So we assume that the shipping company is also hand in glove with the Drawee.
Please advise.
1. Acknowledge Receipt of the documents and advise their Reference number.
2. Deliver documents against acceptance.
3. Advise by Telex/Swift Non-payment stating reasons.
4. Collect all their charges from Drawees.
5. In case of Non payment/Dishonour Please protest.
Tenor : 30 days from the Date of B/L.
It has been found that the collecting Bank (CBA) delivered the documents to the Drawee without any acceptance of the same on either 1st or 2nd Sola of Exchange.
The collecting Bank (CBA) on being charged by us of neglect/fraud/mishandling of the above documents have tried to hide under the pretext that: (We quote from the correspondence recieved by us from Commonwealth Bank of Australia.)
"Unfortunately it appears that the instructions to the Bank from Bank of Maharashtra were contained in an envelope addressed to the Client. i.e. within an envelope addressed to the Branch of the Bank. The branch did not open the envelope addressed to its client, it merely passed it on (as though it were a post office) and did not, as a result, know that the contents of the envelope contained the instuctions to act as a collecting bank or the bills of lading. The branch does not handle trade transactions - they are handled by a specialist central group within the Bank where all instructions should be addressed by remitting banks and it is known to them (the group has been in operation for a number of years).
Under these circumstances the bank could not "elect" to reject the instructions, because it did not know it had recieved any - it had handed them over to its client."
The Bank of Maharashtra has aggressively refuted the claim of an Envelope addressed to the Drawees in the Envelope addressed to the collecting Bank (CBA), also pointing out here that for any documents meant to be delivered to the client directly, they would use the services of the Post Offices or Couriers and not the services of the Bank.
Under the above circumstances it is assumed that the collecting bank (CBA) and the Drawees are hand in glove with each other.
On enquiries with the Shipping company with regards to this consignment, it has been found that the Original B/L against which delivery has been taken by the Drawees has not been Endorsed/released in favour of the Drawees by the Commonwealth Bank of Australia who are the Consignee on the B/L. The Drawess are the Notify Party. So we assume that the shipping company is also hand in glove with the Drawee.
Please advise.