Concerned About Fraud In Crude Oil Selling
Involved About Fraud In Crude Oil Selling Why, for Consumers, getting the 2 % Performance Bond by the seller is the best & Surest Proof of a genuine Vendor
Credible research has proven that, whereas virtually each supposed crude oil seller who goes to a potential crude purchaser to solicit enterprise, would virtually At all times profusely forswear heaven and earth that he, or the crude oil he professes to be selling, is “absolutely reliable, dependable, real, authentic, and sincere,” nearly every Goal, CREDIBLE Proof available, then again, provides a completely opposite and opposite Actuality – namely, that the overwhelming majority of these supposed sellers and their presents (in deed, as much as the extent of 99.999999%, in accordance to at least one report) are totally fake, bogus, fraudulent or not reputable.
MASTERFULLY Solid & FALSE Documents ARE AT The heart OF THE CRUDE/Shopping for Promoting Scam OPERATIONS
The primary instrumentality by which these fraudulent con artists and crude “sellers” function or perpetrate their con sport, is using skillfully solid or false Reserve paperwork. Such fraudulent and fake “sellers” – or, at least, the ultimate masterminds who originate and stand behind the scheme – are notorious for being master forgers and glorious copiers of every conceivable legit refinery and authorities agency documents related to crude gross sales or purchases. In deed, in accordance with specialists, so masterful at this sport are these fraudsters, that the paperwork they provide to potential patrons are often so strikingly convincing and real-wanting that they’re ceaselessly plain difficult, if not impossible, for almost all but probably the most expert of doc authentication specialists to right away distinguish from the true and authentic ones.
As one report by the Fraud Watch Worldwide summed it up, “Victims [of such fraud] are sometimes convinced of the authenticity of Advance Payment Fraud schemes by the cast or false documents bearing apparently official Nigerian government letterhead, seals, in addition to false letters of credit, fee schedules and bank drafts.”
The U.S. State Department’s Bureau of International Narcotics and Legislation Enforcement Affairs, in a report titled “Nigeria Superior Payment Fraud,” describes the documents employed by the Nigerian Advanced Price Fraud (AFF) or 419 perpetrators, as “official-looking stationery with acceptable authorities seals, stamps, and signatures,” whose high quality, it says, has “evolved over the years, from poorly handwritten letters to extra skilled merchandise prepared on word processors. Phrase processors also allow AFF criminals to generate more letters.” It provides that the “AFF criminals embrace college-educated professionals who are the most effective on the planet for nonviolent spectacular crimes.”
The main Problem: INABILITY BY Consumers TO Confirm SELLERS’ CLAIMS & Paperwork
The purpose is that, largely in consequence of the above actuality, for critical international patrons of Nigerian crude oil, the only most critical and most difficult and risky problem they confront in the open market, is now often the verification and confirmation of the vendor’s claims about having an genuine crude allocation and/or its current availability, and the affirmation of the proofs and paperwork submitted by them in help of those claims. For most consumers, enterprise that activity is usually dreaded and considered as one thing fraught with large dangers and uncertainties that should solely be threaded with the utmost warning, and the best care and deliberation.
Consumers’ “Most well-liked” PROOF & Evidence OF CREDIBLE Seller Right this moment – a 2% PB
Because verification and affirmation of such documents from sellers are usually so tough and dicey, most such worldwide crude oil buyers seek, due to this fact, to purchase Solely from sellers who can provide them what they consider the safest, most tangible, and most simply dependable kind of proof and evidence of credibility by a seller. And what is this “most popular” proof and proof that most consumers would reasonably have It is just this – the supply by a vendor of a 2% Efficiency Bond (PB) to the purchaser.
The same old VERIFICATION & Affirmation APPROACHES
In a phrase, the usual proofs and evidence of crude allocation and availability provided by sellers to potential consumers, is often the provision to the Purchaser of the cargo’s PROOF OF PRODUCT or POP. In a C.I.F. or F.O.B deal, for instance, the typical manner by which a supposed crude oil seller reveals “proof” or evidence to a possible buyer that the vendor has a real crude allocation or crude accessible to promote, is for the vendor to offer the purchaser the PROOF OF PRODUCT, and the purchaser is asked to “verify and affirm” the authenticity of this on his own, and, upon that, for the buyers to subject their Bank Guarantee or Letter of Credit (or other cost instrument) to cover the purchase value of the product at delivery.
But the problem with this traditional technique, is that for many worldwide crude patrons, the average Nigerian seller’s POP (an array of paperwork that might include the present loaded vessel documents, present Authority to Board (ATB) that was particularly issued to the initial buyer (consignee) of the crude in whose name the vessel was issued, Certificate of high quality, Certificate of origin, Cargo manifest, Vessel ullage report, Certificate of quantity, Bill of lading, the majority Allocation Particulars, the seller’s Authority to Promote (ATS) from the NNPC, and so forth), will not be dependable or readily verifiable for genuineness. For instance, the POP, which is, in a word, the seller’s important doc that is meant to prove to the buyer that the vendor really has the product being bought, may be displaying that an owner of the oil allocation or commodity has possession of the product as of the precise time of the transaction, say, at a certain hour of the day in the present day. But yet, there isn’t a guarantee that the product won’t have been bought to a different purchaser simply hours, and even minutes, proper after that transaction, and that the commodity is definitely nonetheless obtainable for sale or delivery to the buyer.
“Most consumers do not accept Nigerian sellers’ proof of product (POP),” says Sam Nelson, an skilled in crude buying and promoting methods and the author of a primer on the topic. “On account of this, they (the Buyers) desire a tangible (Bodily) proof of product. The purchaser would request that the vendor examine the cargo and current a verifiable inspection report from accredited companies like SGS, Q & Q or Robinson Worldwide before they (the Consumers) will charter a vessel for the transaction. This is because some so-referred to as Nigerian sellers have false claim over merchandise that by no means existed and they might forge documents to current as POP. Nigerian market has to be followed very fastidiously and all documentations completely verified.”
Nelson provides: “Please do not give any inspection cash to the seller. Always pay the cash directly to the inspection firm after they have collected samples of the crude oil from the mother vessel for chemical analysis to affirm the quality and amount of the crude in the vessel. Additionally, insist that the ATB (Authority To Board) from the vessel for inspection originated from the captain of that vessel. Don’t settle for any documents as genuine should you did not confirm it from the captain of the feeder vessel. Any documentation from a Nigeria vendor must be verified for authenticity.”
MOST Documents OR PROOFS BY NIGERIAN SELLERS ARE Viewed WITH SUSPICION
In deed, these days, the same problem of basic inability to definitively authenticate real crude allocation or availability, now pervades even conditions where “tangible, physical” POP inspection has supposedly been made. And a few patrons discover that even this cautionary advice by Nelson, that the buyers should “insist that the ATB (Authority To Board) from the vessel for inspection originated from the captain of that vessel,” would usually not fairly work any more in lots of conditions right now.
In a TTO deal, for instance, the fact of the buyers’ representatives boarding the vessel to make an “inspection” or “confirmation” of the “loaded” vessel, is often no more a assure that the transaction is necessarily real or reputable. Nigerian con men and 419ers who function within the crude oil business, have been identified to work with fraudulent vessel managers and captains or con males disguised as workers of the Shell/JV terminal operators. And Vessels confirmed as “pregnant” (i.e. loaded) even by the buyer’s representatives and his appointed SGS inspectors invited to come aboard the ship on a presumed ship “captain’s” ATB document, have been known to be actually arranged by pretend ship operators and ship managers and “captains”; and in such instances the buyer will solely be taking over a ship and cargo with Faux Charter Get together Agreement executed between the purchaser and pretend ship supervisor, with no Genuine ship owner’s approval and no authentic transport paperwork. And as soon as the purchaser’s representatives aboard the vessel confirms that the vessel is “pregnant,” the buyer pays for the cargo, takes over the vessel, and the con men shortly cut up the money and crude oil live rate in dollar vanish. The purchaser losses all the pieces since the reputable vessel proprietor by no means authorized the captain to challenge the CPA, and the important cargo delivery documents used in the transaction are all merely fake.
Nigeria’s bureaucratic quagmire
And there’s one more drawback involved in attempting to authenticate Nigerian crude oil paperwork. The issue of the bureaucratic quagmire associated with doing business in Nigeria. One skilled vastly skilled in doing crude oil buying enterprise in Nigeria, put it this option to this author: “NNPC Crude Oil Advertising Division, Abuja, is the authoritative source to confirm the Authority to Sell doc. However you will spend an limitless period of time making an attempt to verify it. As with most Nigerian establishments, individuals use personal connections to get such documents, however that doesn’t mean that they will ship.”
WHAT Patrons NOW VIEW AS The most effective AND MOST “Most popular” PROOF OF AN Authentic CRUDE Seller – A Seller WHO CAN Provide Buyer A 2% Efficiency BOND
In brief, the purpose is that virtually all traditional manners of verification and confirmation of crude oil ownership and availability have turn out to be severely contaminated and adulterated by con artists and pretend operators to the point that many worldwide crude oil buyers regard these strategies as largely unreliable, too difficult to verify, and fraught with intolerable dangers. And consequently, there has evolved amongst them what might immediately be referred to as a “most popular” technique for determining an authentic and credible vendor of crude oil in today’s market. Such a vendor is simply one who can meet one basic requirement – particularly, is keen and in a position to provide the purchaser a 2% Efficiency Bond upfront in a transaction.
What is a Performance Bond or PB
This is, in a word, an insurance coverage doc issued for the seller by seller’s bank or insurance company guaranteeing that the issuer can pay a stipulated amount (a sum amounting, on this case, to 2% of the whole value of the cargo being purchased) to the purchaser within the occasion that the vendor breaches (fails to perform) the terms and specifics of the contract signed by the seller with the purchaser. (The Performance Bond may be posted in the type of a Money Bond). The bank or insurance coverage firm which issues the PB acts as the accountable “surety” of the bond
If a vendor contracts with a buyer to place up a 2% PB – and is in a position to really publish that bond along with his financial institution or insurance company – the vendor is, in a phrase, guaranteeing the buyer that if he have been to fail to carry out his obligations beneath that contract, his bank or insurance firm, in their roles because the “surety” of the bond, will pay the buyer a sum amounting to 2% of the worth of the crude being bought, regardless.
WHY Buyers LOVE THE Performance BOND Guarantee
Patrons love discovering sellers who can present them UPFRONT 2% Efficiency Bond, overwhelmingly viewing that as the “preferred” choice as they consider that the safest, most reliable, most tangible, and most assured and least fraud-prone form of proof and evidence of credibility by a vendor. Most specialists contend that if a seller can supply a 2% PB deal – and, what is much more vital, is actually able to put up the PB as a result of he has the monetary wherewithal to take action – it is nearly assured that the seller is not going to fail the buyer in the actual execution of the deal, but will almost surely perform those obligations as contracted with the buyer.
Sam Nelson, expert in crude buying and selling strategies and the creator of a primer on the subject, put it this manner: “A contract with any of these bonds in place will be successfully accomplished. A bonded contract has a better degree of success than a non-bonded contract. A bonded contract is a bankable contract. The players have their cash at stake and that is an effective motive for them to perform.”
And the Authorized Dictionary explains it this way: “The aim of a bond is to supply an incentive for the achievement of an obligation. It also gives reassurance that the obligation will probably be fulfilled and that compensation is offered if it isn’t fulfilled. Performance Bonds guarantee for the passable completion of a venture.”
There are a couple of specific bases why buyers and specialists feel that approach:
1. Being able to publish a PB is a sign of financial credibility and means.
To have the ability to finance an actual posting of a 2% PB (which can mean, for instance, at the current crude costs, 2% of, say, $200 million for a 2 million barrels cargo, something amounting to $four million), a seller must have some substantial financial potential and sources.
2. Financial Value and Penalty Concerned In Posting a PB, is a strong Disincentive To not Carry out.
Sam Nelson: “The gamers have their cash at stake and that is an efficient reason for them to carry out.” In deed, most consumers, upon getting the 2% PB issuance from a seller, would promptly settle for that as equivalent to POP and forgo having to evaluation the POP.
3. The conventional Con Man or 419er Will not Have the Disposition, the Popularity & Monetary Wherewithal to Post a PB.
Robert Strickland of Strickland Associates, an experienced New York seller in crude oil deals, says as follows: “In case you are involved with FRAUD! Only true Sellers that offer a 2%+ Efficiency Bond are real Sellers of Nigeria [crude oil].”
Sam Nelson, the crude oil offers knowledgeable and creator: “These bonds are obligatory to protect the curiosity of the crude oil live rate in dollar parties concerned for pointless losses due to fraud or complete negligence.”
4. Being able to submit a PB is a solid indication to a purchaser that the seller has already been vetted.
Acquiring a PB is generally not an easy or automatic factor. Earlier than a financial institution or insurance firm would give a vendor a bond, the vendor shall have gone through a rigorous utility course of, and should have met a set of stringent monetary and character necessities and circumstances. Hence, when a purchaser will get a seller who can, and does actually, publish a 2% PB, the buyer is almost assured that he’s bought a credible seller, and one most unlikely to be a fraudster or a 419er.
For just an instance, one Syracuse, New York, insurance coverage firm requires applicants for a Public Building job PB to offer them the next gadgets, amongst others:
Surety Questionnaire Stuffed Out Fully
Copy of Contract/Award Letter or Solicitation Letter
Business Monetary Statements (2 years audited fiscal year financials) OR
Final three years Company Earnings Tax Returns
Private Financial Statements and Resumes on all house owners of 10% or extra
Work in Progress Schedule (if relevant)
A. Workman’s Compensation
B. Liability Certificate
C. Key Man Policy
Provider and Contractor Reference Letters
Schedule of Completed Jobs
Bank Reference Letter
Company and private Indemnification (GAI we provide)
Articles of Incorporation
Job Value Breakdown and/or bid specs
To most buyers of crude oil in the worldwide open market, getting an UPFRONT 2% Efficiency Bond issuance from a seller, is the overwhelmingly “most well-liked” technique for doing a sales/purchase deal. It is the choice they consider to be the safest, most reliable, most tangible, and most assured and least fraud-prone kind of proof and evidence of credibility by a vendor.
For various reasons and components, a lot of which are outlined above, most patrons and experts believe that if a seller can offer a 2% PB deal – and, what is much more important, is definitely in a position to post the PB because he has the financial wherewithal to take action – it is almost assured that the seller is not going to fail the purchaser within the actual execution of the deal, however will almost surely carry out his own obligations as contracted with the purchaser. Therefore, in a deal of that kind the purchaser has little or nothing to worry about regarding a possible danger of fraud or scam. In consequence, consumers love finding sellers who can present them – who can actually submit – a 2% PB, and consider that to be the very best evidence and assurance of having a credible seller, and one most unlikely to not perform the contract, or to be a fraudster or a 419er
Word: As with many things regarding many a Nigerian crude vendor, it’s one factor for a seller to claim to a purchaser that he’ll publish the PB, but quite another factor altogether for the seller to be ready to truly do it, or to truly do it!),.
YOU Need to Observe UP ON How one can Assure GETTING A NIGERIAN CRUDE OIL Vendor WITH A true, UPFRONT 2% Efficiency BOND OR Seller WITH Different Sorts of Gross sales Offers Which are Genuine, “Secure” AND Rip-off-FREE
INSTRUCTION: You can achieve this. You can readily receive the specific fundamental requirements you’d need to satisfy in order for you to change into mechanically thought of “confirmed” as a actually Reputable seller who actually genuinely has some crude to sell. USE THE Author’S Five Fundamental Choices PROGRAM.