100 containers of cashews exported to Italy are at risk of being cheated: A valuable lesson for Vietnamese exporters

Risks from payment methods

5 businesses export cashew nut, through the brokerage company Kim Hanh Viet signed a contract to export cashew nuts to Italy with a total quantity of nearly 100 containers for many customers. According to the buyer’s instructions, businesses submit original documents to Bank Vietnam to ask for sales money. The Vietnamese bank then sends the original set of documents to the buyer’s Turkish payment bank.

However, the Turkish bank informed that the buyer is not their customer and has returned all documents to the Vietnamese bank. With the sets of documents sent to banks in Italy, they were informed that they were not originals, the Industry and Trade newspaper reported.

Detecting signs of fraud, businesses and banks have made efforts to find ways to keep goods and withdraw documents. But out of 100 sets of documents of 36 containers that have been arriving at Italian ports, documents are lost. This means that Vietnamese exporters no longer have control over 36 containers of cashews worth more than 7 million USD, equivalent to more than 160 billion VND, according to the newspaper. Law of Ho Chi Minh City.

Two lessons for Vietnamese businesses

5 cashew export enterprises called for help. Immediately, the Vietnam Cashew Association (VINACAS) sent a written report and asked the Prime Minister to direct relevant ministries and sectors and Interpol Vietnam to step in to best support the business.

According to the newspaper People’s DeputiesThe biggest fraud case in the history of Vietnam’s cashew industry up to this point has shown bright signs. Italian police decided to blockade the goods, not deliver the original documents to the recipient. The Italian port system has also been alerted to the incident.

This case is not over yet. The scam in this deal is not new, it has been repeatedly warned by the authorities for many years, but what makes businesses fall into the trap? This is also an issue that the newspapers focus on analyzing because before this scam, a plastic product export company has recently been scammed by customers in the Middle East and lost nearly 100,000 USD.

Classification of cashew kernels for export. Photo: Vu Sinh.

The cases of being cheated have quite similar reasons, that is, Vietnamese export companies have not clearly verified their partners, through brokers, and lack of information.

Therefore, the eternal lesson is to learn, carefully evaluate the partners as well as understand the risks of the market, especially in the current international trade conditions, mainly electronic transactions, but many businesses was very subjective, even when signing a large contract.

The next lesson, according to the analysis of the sheet Invest is to keep in regular contact with Vietnamese representative agencies in export markets, contact credit verification service providers to learn about partners. Finally, a lesson on compliance with business safety principles, in which the payment stage is considered vital.

Solutions to avoid losses from the “cashew nut crop”

Sheet Business Forum analyzing the cause of businesses being deceived is due to loopholes in the payment method chosen by the parties.

In the case of exporting 100 containers of cashew nuts, the payment method is selected by collection and delivery of D/P documents. With this method, just holding the original documents (original) can receive the goods without having to go through any goods inspection.

According to the sheet Investup to 80-90% of cashew exporters choose the D/P payment method because of no fees and simple procedures.

Even, many businesses still pamper their customers to the point of not forcing them to pay a deposit or paying only at 10% of the contract value or the value of the shipment. This method is risky in that the buyer may not receive the goods.

Meanwhile, the L/C payment method is the least risky but not the most popular payment method. The reason is that the buyer will have a deposit at the bank because he has to deposit a certain amount, even 100% of the value of the contract, so no one wants that.

From this case, it once again shows that Vietnamese enterprises face many risks when participating in international business transactions. Therefore, businesses need to be wary and wary of partners who are too quick in their business.

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