Tran Huu Hau, Deputy Secretary General of the Vietnam Cashew Association (VINACAS), has issued Notice No. 45/TB-HHĐ to cashew businesses, providing information about a suspected fraud case in the export of cashew kernels to Dubai, UAE.
Export businesses are in trouble.
Accordingly, VINACAS received a plea for help from Tin Mai Company (headquartered in Ho Chi Minh City, specializing in the export of pepper, cashew nuts, coffee, etc.) with the following content: this company signed a contract to sell cashew kernels to a food company located at 1006 Mai Tower, Al Nahda, Dubai. Tel +971 43868859, +971 58600 1304; Email: [email protected] through an e-commerce platform. Direct contact person: Mr. Naeem Chaudhry, Mob/Whatsapp: +971 58 600 1304, email: [email protected].
After signing the contract, the customer advanced 15% of the order value to Tin Mai Company. Tin Mai Company delivered the goods, which arrived at Jebel Ali port, UAE, on June 24, 2023. The goods were retrieved and the empty container was returned on June 27, 2023, while Tin Mai Company had still not received 85% of the shipment value.
Although Sacombank Bank sent two Swift messages to the buyer's bank (whose name is temporarily withheld) requesting payment and return of the documents, this was not done.
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| Vietnamese cashew businesses are always targets for many foreign scammers. (Source: Investment Newspaper) |
Upon inspection, it was found that DHL (an international logistics company) had handed over the shipment's documentation to a security officer at the buyer's bank, but the whereabouts of the documents are unknown. Meanwhile, the shipping company stated that they would ship the goods once all the required documentation was in place.
Speaking to the press, Mr. Bach Khanh Nhut, Vice Chairman of VINACAS, said that this was a rare event, occurring in the heart of Dubai's financial center.
Not only the cashew industry, but according to an urgent warning issued simultaneously, the Vietnam Pepper and Spice Association (VPSA) reported that at least two other businesses in the pepper and spice industry are facing a similar situation.
Specifically, reports from companies in this industry indicate that transactions exhibiting fraudulent behavior from the same buyer and the same bank in Dubai resulted in the complete loss of shipments at Jebel Ali port, UAE.
There is international collusion to defraud Vietnamese businesses.
VINACAS cautiously believes that the case shows signs of fraud by the customer or the buyer's bank. Therefore, to support the businesses involved, in addition to immediately contacting the Vietnamese Trade Office in the UAE for assistance, VINACAS will coordinate with VPSA to organize a meeting with the businesses to gather complete information, and then officially propose to the competent authorities of Vietnam and the UAE to consider and support the businesses in resolving the case.
VPSA, in its warning to its members, stated bluntly: The fraudulent transaction occurred right at the buyer's bank where these businesses sent the collection documents, involving the bank's personnel and transaction operations, and showing signs of collusion between the bank and the buyer. Therefore, the buyer gained access to the original documents of the shipment without payment, and simultaneously severed contact with the aforementioned businesses.
"This loss involves the joint role and responsibility of the (foreign) bank and the buyer in organizing and conspiring to carry out fraudulent transactions involving shipments from Vietnamese businesses," the VPSA document stated.
Therefore, VPSA advises its member businesses to exercise extreme caution when dealing with Dubai customers in the UAE market.
The UAE is one of Vietnam's top 10 export partners globally and its largest trading partner in the Middle East and Africa region.
I've been scammed many times, but…
This is not the first instance of foreign individuals attempting to defraud Vietnamese agricultural export businesses.
In April 2023, both VINACAS and VPSA simultaneously sent warnings to their member businesses after the Vietnamese Trade Office in Algeria issued a telegram warning about fraud when exporting to Algeria.
According to the Vietnam Trade Office, in August 2022, a Vietnamese company exported five containers of cashew nuts to Algeria through an intermediary business located in South Africa. The South African intermediary company paid a 10% deposit of the goods' value.
However, upon arrival at the port of Mostaganem (Algeria), the customer, Eurl ATS Food Company, was unable to complete customs procedures because the Algerian Ministry of Commerce had placed the company on a list of businesses engaging in trade fraud since June 2022 (this list was not published by Algeria).
The consignee is a Vietnamese company, and the shipping company processed the change of consignee to Eurl Azur Oran Company (Algeria) at the request of an intermediary in South Africa. However, Algerian customs did not accept this, citing the company's lack of legal capacity to carry out procedures such as import, changing the consignee, or re-exporting the goods.
According to regulations, if goods remain at the port for four and a half months after being unloaded from the ship without a qualified business claiming them, Algerian customs will auction them off to contribute to the state treasury. Fortunately, upon receiving information from Algerian customs, VINACAS requested the Vietnamese Trade Office in Algeria to provide documents proving the legitimate owner of the goods and asked for the cancellation of the auction. As a result, Algerian customs canceled the auction and returned the goods to the Vietnamese company.
Earlier in 2022, VINACAS had to hold an urgent press conference to announce that, through the mediation of Kim Hanh Viet One-Member Limited Company, five Vietnamese cashew exporting companies had signed contracts to export 100 containers of cashews to Italy.
The goods were shipped, but numerous problems were discovered. Some businesses with unpacked goods that hadn't yet been transported urgently requested banks to halt the shipment and seize the necessary documents to stop the containers from moving. Ultimately, many businesses and banks lost control of 36 containers of cashew nuts, worth over $7 million, equivalent to 160 billion VND.
Subsequently, over several months, with coordinated efforts from Vietnamese authorities and the Vietnamese Trade Office in Italy, the 36 containers were returned to the ownership of Vietnamese businesses.
In addition to the above cases, since 2020, the Vietnamese Trade Office in the UAE has also issued warnings, continuously receiving, detecting, and handling numerous cases where Vietnamese businesses received offers to sell or buy goods, or sign commercial contracts with signs of fraud and deception from some businesses based in the UAE.
Similarly, since 2020, the Vietnamese Trade Offices in the Netherlands, Nigeria, Algeria, and Morocco have regularly sent out warnings about fraud in these markets.
Following each outbreak of such scams, numerous authorities and experts have analyzed the tactics, issued warnings, and offered advice. Yet, Vietnamese businesses continue to fall victim to these scams.
Therefore, given the current situation in the UAE market, experts believe that the first and most crucial condition for Vietnamese businesses to avoid falling into a similar predicament is to refrain from rushing into contracts with unusually high profit margins.
Notice from the Ministry of Industry and Trade to import and export businesses. - It's necessary to carefully verify partner information. For the first transaction, it's advisable to start with a moderate contract value. Pay particular attention to and carefully check the reliability of any offers that are excessively high or low compared to market prices. - Regularly maintain contact with Vietnamese representative agencies such as the Trade Office in the host country to verify the reliability of partners, especially businesses with whom you do not have direct contact or who are found online. - It is advisable to request that partners use irrevocable letters of credit (L/C) opened at reputable international banks, and to limit late payments. When partners open L/Cs, it is necessary to request that Vietnamese banks verify the authenticity of the L/C before releasing the documents. - For D/P payments, Vietnamese businesses need to specify a deposit percentage to ensure the security of orders (ideally 50% or more). D/A (documentary collection) payments or Western Union transfers should not be used for payment. - Consider utilizing banking services to increase the likelihood of debt recovery through the provision of banking services, as well as assisting businesses in researching and evaluating information about import partners and letter of credit issuers. |
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