Proceeds must be avoided.

· BCL and RWA issues

· LIST OF NONSENSICAL BROKERS TERMS

· LOI (Letter of Intent - improper term)

· NCND

· Performance Bond

BCL and RWA issues

Overback Trading does not issue BCL or provide POF prior to acceptance of offer and contract signing. To do otherwise is foolhardy and makes no business sense. Business confidentiality is paramount, as a full service consultancy Overback Trading can undertake no action to endanger its principals or clients, providing loose access to Overback Trading banking is such an action. No serious buyer gives an untested vendor access to banking confidentials.

In general only brokers, not principal suppliers seem to request BCL’s. This seems to be to gain a sense of comfort. However, at most a BCL will only indicate some degree of financial capacity. Buyer trying to provide premature proof of RWA via a BCL does not guarantee purchase, period. It says "I have money to buy something", it does not say "I will buy something from you."
BCL’s never prove RWA for reasons detailed below, therefore requiring them is a waste of time and generally a deal killer.
A serious Seller is concerned about one thing only, closing a sale. Where the Buyer’s funds come from, at what stage in a transaction Buyer might choose to fund a certain account, and other matters are simply not the Seller’s concern as long as the Buyer is able to perform as required. A LC 100% guaranted by the bank at the appropriate stage of transaction is the most appropriate method of demonstrating RWA, such an irrevocable payment is useless until the documents passing title to the Buyer are produced. No money - no product, no product documents - no money.
This is the most secure and safe protocol protecting Buyers and Sellers globally. Even if a Buyer decides foolishly to issue a full BCL this does not fully prove the Buyer is RWA, the only serious thing that proves a Buyer is RWA is to deposit a credit payment instrument.
In both domestic and international sales the BCL is never seriously used between principals and, in fact, proves nothing anyway. The BCL has some limited use between subsidiaries of the same corporation and certain other esoteric uses that need not concern us here.
Brokers who request a BCL need to consider that few serious Buyers will issue a financial statement of such confidentiality in today’s international area rife with fraud, identity theft, piracy, and other financial threats to fortune, life, and limb. The intermediary who foolhardily insists on a BCL consistently condemns his deal to collapse. In a world of rampant fraud no serious buyer allows soft probes into their banking. No serious deals ensue when conducted using non-ICC approved pseudo protocols involving LOI, NCND Agreements, BCL letters, and the like.

LIST OF NONSENSICAL BROKERS TERMS

Terms that do not exist in real banking world nor real international deal, only appear most frequently in the internet.

Bank Hard Copy
Bank Invoice
Bank/Corporate Pay Order
Banking Co-ordinates
Blocked Funds Letters
CIF ASWP
Clean, Cleared Funds of Non-Criminal Origin Conditional Swift/Wire
Cutting House
Exit Buyer
Fed approved
For value received, we, the undersigned officers of ….. Fresh Cut
ICC 3034/3039 Format
ICC 600
ICC NCND
Instruments free of liens and encumbrances International Banking Hours/Days
Irrevocable, Confirmable, Assignable, Divisible, Transferable KTT
London Short Form
Master Cutter/Trader
One Year and One Day
Prime Bank
Prime Bank Debentures, Guarantees or Notes Proof of Funds Letters
Roll Program
Rolls and Extensions
RWA Ready Willing and Able
Seasoned
Soft Probe
Subject to the laws of U.S.A., Switzerland, England and etc. Tier 1 Banks
Under Penalty of Perjury
Window Time 

LOI (Letter of Intent - improper term)

Letters of Intent have no weight whatsoever in international trade rules. Anything backed by a LOI has no binding power because the LOI has no place in legally binding international trade protocols. One can seek clarification on this point from the ICC directly.

In general, the issuer of an LOI has no liability since under international law, such Intent can’t be legally binding. This is the case even after contracts are issued. A LOI expresses an "Intent", nothing more. One can intend to purchase today and change one’s mind tomorrow. Letters of Intent have certain binding or non binding legal applications in domestic trade under various laws of various countries.
In the international trading arena the Letter of Intent, however, means nothing. A Letter of Intent proves exactly that, Intent. It reflects an understanding of the intent of one or more parties to act. Intent can change in seconds. There is nothing binding about intent. A letter of intent is a simple enquiry, no more and no less. There is no standard application of the LOI with the BCL in International sales transactions.
International legally binding rules of contract stipulate the very first document in the transaction is the Quotation. This is followed by an actual offer. The offer may in some contexts be a legally binding contract, in other contexts the offer is followed up by a formal sales contract supported with "consideration", amongst the consideration due is monetary remuneration.

NCND

In the international trade arena NCND Agreements are not binding and impossible to enforce. It is impossible to prove circumvention took place between two parties without considerable legal resources and NCND agreements simply aren’t recognized. They can be adjucated in local courts but how will you sue someone for a breech halfway around the world while not even being able to rigorously provide proof that a transaction occurred as result of the breech?

There is no need for a Buyer and direct Supplier, or a Buyer and the intermediaries, agents and brokers alike, between the Buyer and Supplier, to sign a NCND. In fact requesting a NCND is a red flag illustrating possible unprofessionalism, and ignorance of international trading procedures and laws. Please read this information detailing on our Anti Fraud advisory.
Performance Bond

A "Performance Bond"(PB) could be applied in a deal where delivery is based on "Ex Ship" as defined under Incoterms 2000.

Where the “assurances” given apply to "Bond" with the goods, until such goods arrive in the contracted condition into the possession of the End Buyer, in his port of discharge. In an "Ex ship" deal the goods and not the documents must arrive before delivery is said to have occurred.

Once the deal is "At sight" 100% against presentation of documents FCA/FOB/CIF, this must be a Performance Guarantee, since such seller cannot deal the possession of goods (phisical), the Performance in this case being "Delivery” is only applied to the securing of the title or leading delivery documents to the goods being offered, and to do so in a certain time frame as per it’s guarantee.

S.W.I.F.T. Standards 2008 FAQ

The Society for Worldwide Interbank Financial Telecommunication ("SWIFT") operates a worldwide financial messaging network. Messages are securely and reliably exchanged between banks and other financial institutions. SWIFT also markets software and services to financial institutions, much of it for use on the SWIFTNet Network, and ISO 9362 bank identifier codes are popularly known as "SWIFT codes".
The majority of international interbank messages use the SWIFT network. As of December 2007 SWIFT linked 8,332 financial institutions in 208 countries.[1] SWIFT does not facilitate funds transfer. Financial institutions would need a corresponding banking relationship for financial transactions.[clarify] Not all financial institutions have banking business relationships, but rather peripheral. Each financial institution, to exchange banking transactions, must have a banking relationship by either being a bank or affiliating itself with one (or more) so as to enjoy those particular business features.
SWIFT is a cooperative society under Belgian law and it is owned by its member financial institutions. SWIFT has offices around the world. SWIFT headquarters are located in La Hulpe, Belgium, near Brussels.
It was founded in Brussels in 1973, supported by 239 banks in 15 countries. It started to establish common standards (See SWIFT Standards) for financial transactions and a shared data processing system and worldwide communications network. Fundamental operating procedures, rules for liability etc., were established in 1975 and the first message was sent in 1977.
S.W.I.F.T. is a registered mark of Society for Worldwide Interbank Financial Telecommunication.

· Cat. 7: Documentary Credits and Guarantees

· MT 103

· SWIFT UCP 600 Usage Guidelines

Cat. 7: Documentary Credits and Guarantees

SWIFT currently offers two sets of its traditional standards in thetrade services area - standards for documentary collections and cashletters (MT 4xx) and standards for documentary credits and guarantees(MT 7xx).

[1]

MT 103

Single Customer Credit Transfer
Note: This kind of message is not recommended for purchase commodities due to there is no secure for buyers.

Format

Status	Tag	Field Name	Content/Options	No.
M	20	Sender’s Reference	16x	1
—–>
O	13C	Time Indication	/8c/4!n1!s4!n	2
—–|
M	23B	Bank Operation Code	4!c	3
—–>
O	23E	Instruction Code	4!c[/30x]	4
—–|
O	26T	Transaction Type Code	3!c	5
M	32A	Value Date/Currency/Interbank Settled Amount	6!n3!a15d	6
O	33B	Currency/Instructed Amount	3!a15d	7
O	36	Exchange Rate	12d	8
M	50a	Ordering Customer	A, K or F	9
O	51A	Sending Institution (IFT only)	[/x] c	10
O	52a	Ordering Institution	A or D	11
O	53a	Sender’s Correspondent	A, B or D	12
O	54a	Receiver’s Correspondent	A, B or D	13
O	55a	Third Reimbursement Institution	A, B or D	14
O	56a	Intermediary Institution	A, C or D	15
O	57a	Account With Institution	A, B, C or D	16
M	59a	Beneficiary Customer	A or	17
O	70	Remittance Information	4*35x	18
M	71A	Details of Charges	3!a	19
—–>
O	71F	Sender’s Charges	3!a15d	20
—–|
O	71G	Receiver’s Charges	3!a15d	21
O	72	Sender to Receiver Information	6*35x	22
O	77B	Regulatory Reporting	3*35x	23
O	77T	Envelope Contents	9000z	24

SWIFT UCP 600 Usage Guidelines

During its 24-25 October 2006 meeting, the ICC Commission on Banking Technique and Practice approved new UCP 600 rules for documentary credits. These rules will take effect on 1 July 2007. With the purpose to remain aligned with the new UCP 600 from this date onward, the ‘SWIFT UCP 600 Guidelines’ provide guidance to banks on how to use today’s category 7 standards in compliance with UCP 600.
Traditionally, SWIFT groups all its MT standards changes in one annual standards release, usually in October or November. In 2007, this will be on 27 October. In other words, the 1 July 2007 effective date of the UCP 600 does not coincide with the implementation date of SWIFT’s Standards Release 2007.
This means that the only way to let the ICC and SWIFT ‘live’ dates coincide and to publish how the UCP 600 affects category 7 standards was by issuing ‘SWIFT UCP 600 Guidelines’ that financial institutions can start using as soon as the UCP 600 rules go ‘live’. All guidelines are based on the use of narrative text in existing fields. This should ensure a seamless transition to the new rules.
The November 2006 SWIFT release caters for the UCP 600 using today’s existing category 7 messages. A new mandatory field 40E Applicable Rules contains codes to indicate adherence to specific rules. Other changes as described below will be implemented in October 2007.
James Wills, Head of Trade Services Standards Development at SWIFT notes, “The difference in dates for UCP 600 (1 July 2007) and the annual SWIFT Standards Release (November 2006 and October 2007) has provided something of a challenge. However, SWIFT has worked with the industry to develop this approach to managing the issue, so that the community will be able to work successfully with the dates and guidelines.”
The SWIFT UCP 600 Guidelines will be reflected in the official Standards Release 2007 documentation (Standards Release Guide and User Handbook) of 27 October 2007.

Changes that financial institutions can use from 1 July 2007

1. Date and place for presentation of documents under a credit

a) Field 31D “Date and Place of Expiry” of the MT 700, 705, 710, 720 and 740 The definition of this field should be interpreted as follows: “This field specifies the latest date for presentation under the documentary credit and the place where documents may be presented.” This guideline does not change the usage of this field.
b) Field 41a “Available With… By…” of the MT 700, 705, 710 and 720 The definition of this field should be interpreted as follows: “This field identifies the bank with which the documentary credit is available (the place for presentation) and an indication of how the credit is available.” This guideline does not change the usage of this field.

2. Expiry dates in reimbursement authorizations (or amendments thereof)

a) Field 31D “Date and Place of Expiry” of the MT 740 The following usage rule should be added: “This field should not be used to specify the latest date for presentation of a reimbursement claim or an expiry date for the reimbursement authorization.”
b) Field 72 “Sender to Receiver Information” of the MT 740 The following usage rule should be added: “Any latest date for a reimbursement claim or an expiry date for the reimbursement authorization should be indicated in this field and not in field 31D.
c) Field 31E “New Date of Expiry” of the MT 747 The following usage rule should be added: “This field should not be used to specify a new latest date for presentation of a reimbursement claim or a new expiry date for the reimbursement authorization.”
d) Field 72 “Sender to Receiver Information” of the MT 747 The following usage rule should be added: “Any new latest date for a reimbursement claim or a new expiry date for the reimbursement authorization should be indicated in this field and not in field 31E.”

3. Details about the disposal of documents in a notice of refusal

Any details regarding the disposal of documents for which the two existing code words “HOLD” and “RETURN” in field 77B “Disposal of Documents” of the MT 734 Notice of Refusal cannot be used, must reflect the content of article 16.c of UCP 600 as follows:
a) The code word “NOTIFY”, to signify that “The issuing bank is holding the documents until it receives a waiver from the applicant and agrees to accept it, or receives further instructions from the presenter prior to agreeing to accept a waiver.”
b) The code word “PREVINST”, to signify that “The bank is acting in accordance with instructions previously received from the presenter.”

Because the contents (including code words) of field 77B “Disposal of Documents” of the MT 734 are not centrally validated (ie, checked) by SWIFTNet, users may start using the above codes as of 1 July 2007 (live date of UCP 600). Alternatively, field 77B may contain a narrative text, reflecting the content of article 16.c of UCP 600.

Anti Fraud Advisory FAQ

Our financial juridical sector advert the most fraud terms that appear over the internet.

· Bank Guarantee

· Letter of Intent

· MT-760

· MT-799

· NCND Agreement by ICC

· Performance Bond

· Proof of funds

· Standby Letter of Credit

Bank Guarantee

"Bank Guarantee" is loosely used to signify any one of several financial instruments used in trade finance.  These include LETTERS OF CREDIT in their various roles, DEMAND GUARANTEES, and PERFORMANCE BONDS.

Financial con artists persuade their marks that there is a wonderful, secret opportunity available in trading so-called  PRIME BANK GUARANTEES, or PBG’s.
They use the term as if it were a stand-alone financial instrument that can be obtained in quantity like stocks and bonds, and attach all sorts of quick wealth accumulation to the myth.
One finds the use of Bank Guarantee, BG, and PBG in HIGH-YIELD INVESTMENT PROGRAM scams, in which the investor is told many a tale about leveraging anywhere from $10,000 to $10,000,000 to purchase hundreds of millions or even billions of dollars worth of guarantees on day one, then selling them on day two for huge profits.
The truth of the matter is that the buying and selling of trade finance instruments is a highly specialized field, relegated only to experienced FORFAITERS and the forfaiting department of international banks.  Forfaiting requires an intimate working knowledge of international politics, law, and economy.

As for selling a Bank Guarantee for profit, wouldn’t really be very practical.

Letter of Intent

A Letter of Intent is written once a general agreement has been worked out between parties such as a buyer and a seller, and outlines the various points of the general agreement.  An LOI is usually non-binding and contains a non-binding clause.

An LOI cannot and will not ever be considered a contract. This is simply contrary to contract law. The seller and buyer will always have to enter into an enforceable commercial contract. An LOI is simply just that, an expression of interest or intention. More than 95% of the time the LOI is written by a broker, not the actual seller, and for the most part, these brokers have just cut and pasted information on how to write an LOI from another broker so check for several errors, and remember it holds NO contractual bearing whatsoever.

The laws of perjury do not apply to ANY commercial document, LOI or agreement. This is contrary to contract law and it is impossible for someone to perjure themselves in a letter of intent or interest.

MT-760

Is not a proof of funds, blocking of funds, movement of funds, or a fund settlement. MT-760 serves ONE purpose only it is for the movement of a bank guarantee (NOT MTN’s or any bonds) from the sellers bank officer to the buyers bank officer, these are used in buy/sells of BG’s ONLY.

MT-799

MT-799 is a simple text message sent bank to bank. In this business, this is used for a bank to bank proof of funds only. The MT-799 is not a form of payment, and it is not an undertaking or promise to pay. It is simply a bank to bank confirmation of “funds on deposit”, nothing more. A lot of scammers have modified the use of the MT-799 to make it look like a bank undertaking they are just kidding themselves, this is never the case.

NCND Agreement by ICC

The I.C.C., Paris/France is NOT an enforcement, adjudication, or legislative body. They are simply an informational body and tey have never published anything on the subject of an NCND, accordingly the ICC has no jurisdictional authority or standing in any commercial agreement. In the UNDERGROUND NETWORK NCND’s are handed out like candy.  It is the very first request from one INTERMEDIARY to another.  Often everything is crammed into one of these NCND’s so that they may run several pages, with the signatory page being rife with parties to the agreement.  Even commission figures are sometimes included, although commissions are part of a separate agreement in the normal course of business.  One sure-fire way to spot a phony NCND is by a referral to the INTERNATIONAL CHAMBER OF COMMERCE (ICC) UCP400, UCP500 or UCP600.  The UCP 400 or 500 or 600 is a booklet that outlines standard practices for DOCUMENTARY CREDITS and has absolutely nothing to do with NCND’s.