MoIT warns about international trade fraud

Trade experts said that the number of cases was increasing and taking place in all markets from Africa, the Middle East, India to developed countries such as the US, the Netherlands and Italy. — Photo congdankhuyenhoc.vn

The Vietnamese trade offices in many foreign markets have continuously warned Vietnamese businesses to be careful to avoid international trade fraud.

The number of Vietnamese businesses encountering fraud and scams with more sophisticated methods has risen and many businesses have lost tens of thousands of US dollars, even up to millions of US dollars, from the end of last year until now.

In most cases, after detecting commercial fraud or fraud, the majority of Vietnamese businesses request Vietnamese embassies and trade offices in other countries to support and find fraudulent businesses to reclaim lost goods and money.

However, recovering goods or money can be very difficult and expensive.

Trade experts said that the number of cases was increasing and taking place in all markets from Africa, the Middle East, India to developed countries such as the US, the Netherlands and Italy.

That was also a lesson for Vietnamese businesses to develop more risk management mechanisms and not to take big risks in trade, said experts.

The representative of the Vietnamese trade office in the Netherlands shared that fraudsters often set up fake websites with completely fabricated information or set up a website impersonating real import-export companies or oil tank rental service providers, with the contact point usually being a mobile phone number or internet phone number (4G SIM number).

Taking advantage of the Netherlands' reputation as a developed country with a rigorous legal system and trustworthy business practices, some companies rushed into contracts with attractive terms without thoroughly verifying information about their partners, fearing they might miss out on opportunities, said the representative.

When businesses intend to verify the legal status of entities, they often provide information based on copied data from business registration licences issued by authorised agencies or allow verification directly by independent third parties. However, in practice, such verification can not be conducted because the information turns out to be falsified or non-existent.

Nguyễn Cẩm Trang, deputy director of the Agency of Foreign Trade under the Ministry of Industry and Trade (MoIT), emphasised that deep international economic integration had opened up many trade opportunities for Vietnamese businesses, contributing to boosting exports. However, businesses also faced many different risks in international trade, said Trang.

The MoIT and the Vietnamese trade offices abroad had continuously warned, but there were still some unfortunate incidents.

This was partly due to subjective psychology, partly from poor understanding in commercial transactions, or there were cases where information was obtained, but in reality, the events that occured became increasingly complex and perse that the business did not foresee.

Finding a reliable partner was important, so businesses needed to find out and verify partners and needed to request intermediary businesses to provide specific information about partners; find out forms of insurance and derivative tools for goods to reduce damage, she noted.

Châu Văn Bắc, Deputy Secretary General of the Việt Nam International Arbitration Centre (VIAC), pointed out that for many years, disputes related to international trade and the sale of international goods had consistently accounted for the highest number of cases referred for resolution at VIAC. In many of these cases, Vietnamese enterprises had been in a disadvantageous position.

Through commercial disputes with foreign partners, Bắc recommended that businesses needed to carefully consider large value contracts and research partners online.

In addition, before signing a contract, businesses needed to carefully find out information about partners and contact Vietnamese trade offices in the host country or concurrently to receive additional support and information about partners, he added.

Businesses should also pay attention to the sanctions clause in the signed contract, taking into account the risk that disputes may arise during the transaction process, said Bắc.

To support companies, Hoàng Minh Chiến, Deputy Director of the MoIT’s Việt Nam Trade Promotion Agency said that the ministry had coordinated with localities, industry associations, ministries, departments and branches related to Vietnamese representative agencies abroad to provide businesses with information and experience in international trade transactions.

In the near future, the MoIT would deploy activities related to training and capacity building for businesses participating in international trade activities, he said.

In addition, it would also assign Vietnamese trade offices abroad to provide and update information on the market situation as well as recommendations for Vietnamese businesses, he added.

At the same time, the trade offices would also be a bridge to help businesses verify information related to partners and customers with whom they are conducting international transactions.