Mr. 'X,' an importer, opens an L/C amounting $8,90,810.50 for import of edible oil. Bank made payment of the full amount (8,90,810.50) based on shipping documents and endorsed the same in favor of the importer for the purpose of releasing the goods. Instead of those documents, a set of fabricated documents were submitted to the customs as the value of goods arrived under that L/C was only $59,150. However, goods could not be released from customs due to failure in quality inspection. Meanwhile, a fabricated copy of bill of entry valuing $8,90,810.50 was submitted to the bank evidencing the proper release of the goods.
-from the above incident, what type of trade based money laundering alerts do you suspect? Explain.

Question

Mr. 'X,' an importer, opens an L/C amounting $8,90,810.50 for import of edible oil. Bank made payment of the full amount (8,90,810.50) based on shipping documents and endorsed the same in favor of the importer for the purpose of releasing the goods. Instead of those documents, a set of fabricated documents were submitted to the customs as the value of goods arrived under that L/C was only $59,150. However, goods could not be released from customs due to failure in quality inspection. Meanwhile, a fabricated copy of bill of entry valuing $8,90,810.50 was submitted to the bank evidencing the proper release of the goods.

-from the above incident, what type of trade based money laundering alerts do you suspect? Explain.

Satt Academy · Accepted Answer

Mr. 'X,' an importer, opens an L/C amounting $8,90,810.50 for import of edible oil. Bank made payment of the full amount (8,90,810.50) based on shipping documents and endorsed the same in favor of the importer for the purpose of releasing the goods. Instead of those documents, a set of fabricated do

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