Friday, February 26, 2010

Alleged Shipping Scam Deprives Export Owners Of Freight

Pakistan Bills of Lading " False "
Shipping News Feature

PAKISTAN – Local media report that the Federal Investigation Agency (FIA) are looking into cases put forward by several exporters that they are being swindled out of their goods by freight forwarders and shipping companies. The accusation is that whereas they are instructing agents as to the precise details of consignees the carriers are allegedly changing the terms of the Bills of Lading from the exporters chosen bank to that of the end user.

The scheme is alleged to work by the use of House Bills of Lading as opposed to the standard irrevocable Bills issued by the lines. The accusations are unusual as it is hard to see how any shipping line is involved. The original Bills of Lading might well be for consolidations but this could not be attributable to the line if the individual consignments are then split onto House Bs/L.

Pakistan forwarders, in common with many across the world, apparently have form for this type of offence. In 2008 the Federal Tax Ombudsman was in discussions with the Pakistan International Freight Forwarders Association (PIFFA) surrounding violations of the rules regarding shipping documents as laid out by the State Bank of Pakistan. The rules are clearly stated under the Bank’s Foreign Exchange Manual (chapter XII Rule 11) and consignment to other than the authorised bank overseas by the “authorized dealer” (i.e. the freight forwarder or shipping company) would be construed as fraud or incompetence.

Investigations into the matter are ongoing with the FIA said to be summoning those involved for the purpose of resolving the matter. Meantime Pakistani exporters are cautioned to check that they only accept genuine documents for all overseas shipments and that these are correctly prepared and endorsed. Any queries surrounding the acceptability of documents would be best addressed to the PIFFA.