The ICC Financial Investigation Bureau (FIB) has urged caution over sourcing commodities from online suppliers, particularly from those who offer a wide range of products but lack established credentials. A recent case referred to FIB highlighted the need for caution. A South African trader found a seller willing to provide detergent at a price below the market rate. The seller claimed to have operations in several countries and to deal in numerous commodities. FIB Manager Karen O’Neill commented: “Fraudsters can set up impressive websites to lure their victims. In recent years, the Bureau has seen an increase in suspect transactions offered by sellers who claim to provide a wide range of commodities usually associated with substantial companies often at a discounted price on highly favourable terms for the buyer victim.. They are often receptive to requests made by the buyer and their prices can be negotiated even further down.” In this case the supplier was found on a prominent ‘Business to Business’ (B2B) website. The supplier offered to supply washing powder in substantial quantities at a cheaper price than those for goods produced domestically. He also ceded to requests made over packaging and guaranteed proper inspection reports for the goods - at one point he even told the buyer to ‘name his price’. The buyer became suspicious when the documents received from the seller included documents purportedly issued by the ICC. This submission prompted the buyer to verify the documents with the ICC, who advised that they were illegitimate. With this in mind, the buyer contacted FIB, which conducted a more detailed investigation which promptly cast doubt on several other aspects of the transaction.
The seller’s company was registered in South Africa in 2007, though he was using a different address to that held by the registry. Also, in this period it is claimed that he has business interests across Africa, the Middle East, United States and Europe. The seller claimed to have interests as diverse as crude oil, sugar and cement. The contract, meanwhile, had a number of rudimentary errors and did not appear to be the work of an experienced trader. It later transpired that the bank details provided belonged to an account that had been inactive for more than a year. Ms. O’Neill continued: “In this case, the buyer had the wherewithal to verify suspect documents before proceeding, ultimately saving himself time and money. Only by establishing the credentials of potential trading partners prior to any transaction can one be confident that they are capable of maintaining their end of the deal. We would advise caution to any buyer seeking to deal with a seller purely based upon what they see on the internet.” As part of its service to members, FIB carries out due diligence on companies, individuals and transactions.