“Fraud and Mistakes in International Trade” – The Second Transfer Case

Over the course of his 35 years in banking, Abdurrahman Özalp has seen or heard of the good, the bad, and the bizarre that can occur in international trade.

In 2024, the trade finance consultant who currently serves as Chairman of the ICC Türkiye Banking Commission published “Fraud and Mistakes in International Trade”. In the first half of his 210-page eBook, Özalp discusses the proper channels to conduct international trade – valid methods of payment and security – with particular emphasis on the letter of credit process. Özalp then delves into the dark side of trade by presenting more than 50 case studies rife with an array of fraudulent tactics and outright mistakes.

The wide range of deceitful schemes and flawed practices he addresses includes instances involving collusion under a transferable LC, defective goods, notification of assignment, NVOCCs, careless bank actions, unclear collection instructions, misuse of draft LC text, unauthorized guarantee sent via SWIFT, letter of indemnity, and charter party bills of lading.                      

To give DCW readers an idea of the case studies gathered and examined by Özalp, consider the details that follow and the Second Transfer Case.