AN ASSESSMENT FOR FRAUD CASES İN LETTER OF CREDİT PAYMENT METHOD

Abstract

Contemporary technologic improvements have created new payment methods in international trade and the usage of the blockchain technology in the international trade has been brought to agenda at the mean time. On the other hand, grounding on the presentation of documents, classic payment methods, just as cash against goods/documents and letter of credits have still been preferred as a result of the technologic infrastructure distinctions between emerged and emerging countries.

Letters of credit are perceived as more complicated than other forms of payment methods in terms of the rules and regulations which they are subject, but meanwhile they are defined as more reliable than others due to the involvement of banks as a party. In this study, fraud and forgery cases that are an exception to the reliability of letter of credit and cause loss of reputation as well as financial loss of the parties are examined and precautions can be taken by the parties are mentioned measures that can be taken by the parties are mentioned.