Hanoi (VNA) – The Ministry ofIndustry and Trade (MoIT) recommended on July 25 that Vietnamese companies becautious and thoroughly negotiate payment clauses when conducting transactionswith foreign firms, following a suspected scam involving five batches ofVietnamese farm produce in Dubai.

It said that scams in the Middle Easthave increased recently, mostly involving small trading companies. The mostcommon trick is that when signing contracts, foreign enterprises often requestVietnamese companies to make telegraphic transfers (TT), or they issue cheques aspledges to sellers. Both are the forms of payment with the highest risks.

TT is a form of payment in which buyerswill pay to sellers after receiving goods. In cheque issuance, buyers may issuecheques without money in their bank accounts while sellers are unable to cometo the banks of buyers to receive money since they do not have identity cards. Sellersare also unable to check information of buyers’ accounts as banks in someMiddle Eastern countries do not provide customer information for a third party.

Given this, the MoIT called on Vietnamese companies to be cautious andthoroughly negotiate payment clauses to ensure safety.

It recommended them use letters ofcredit (L/C) or send representatives to directly meet buyers to hand overdocuments and receive payments. The documents against payment (D/P) is alsosafer than the TT and cheque payments, but businesses need to ensure safetywhen handing over documents to the banks of buyers.

The Vietnam Pepper Association (VPA) reported that some of its members haveexported peppercorn, cinnamon, star anise, and cashew nuts to the UAE but foundsigns of scams from the same buyer (Bab A1 Rehab Foodstuff Trading LLC) and thesame bank (Ajman Bank JSC) based in Dubai.

They have lost four containers of theproduce worth 400,000 USD when the goods arrived at Jebel Ali Port of the UAE. Theyare now at risk of losing one container of star anise scheduled to arrive at theport on July 26.

As soon as receiving the report, the MoIT’s Asia - Africa Market Department sent a diplomatic note to the UAE Embassy in Vietnam to ask the embassy toinform competent agencies of its country to deal with the case.

On July 25, the MoIT had an urgentmeeting with the UAE Embassy, the State Bank of Vietnam, the VPA, the ForeignTrade Agency, and the businesses owning the export batches.

It also ordered the Vietnamese Trade Office in the UAE to quickly handle thecase.

Meanwhile, to present the loss of the staranise container and trace the swindling importer, the Ministry of Agricultureand Rural Development has also asked the UAE Embassy to propose UAE authoritiestemporarily seize the star anise container at the port and investigate the fourstolen batches./.