ITIC issues warning on forged documents

Bribery and Corruption, Corruption, Maritime Fraud, P and I Clubs, Safety and Security — By on October 29, 2013 at 10:31 AM

ITIC logo (1)ITIC has warned shipping intermediaries to be on the look-out for cleverly forged documents which could result in them being held liable for substantial claims by cargo interests.

In the latest issue of its Claims Review, ITIC refers to the case of a Belgian ship agent which released six containers of castor oil valued at $270, 000 against a fraudulent bill of lading. The containers were to be shipped from India to Belgium, and although the bill of lading against which the ship agent released the cargo to the consignee appeared at first glance to be genuine, it was in fact a clever forgery.

The shipper claimed that it had not been paid for the cargo, for which it still held the original bills of lading. It duly arrested one of the carrier’s vessels in India and obtained a bank guarantee from the carrier as security for its claim. In turn, the carrier looked to the ship agent for indemnity.

Examination of the bills of lading that had been presented established that the agent should have spotted the forgery. The forged bills included clearly incorrect details, such as the name of the load port, and also spelling errors, including the name of the carrier. The agent had therefore been negligent in releasing the cargo against the documents.

The claim brought against the carrier by the shipper was for the cargo value plus costs and interest. The case was fought in the Indian courts, which is usually a slow process. As it was unlikely that the claim could be successfully defended,

ITIC and the carrier pushed the shipper to settle the matter. Finally, after almost four years of negotiation, a settlement of $160, 000 was agreed – $100, 000 less than the original amount claimed. ITIC also reimbursed the carrier’s legal costs and the bank charges incurred in maintaining the bank guarantee.

ITIC says it has never been easier for documents to be cleverly forged, and warns ship agents that they need to ensure that they thoroughly check the details on bills of lading and other such documentation.

Copies of the ITIC Claim Review can be requested from: chris@merlinco.com

* ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at www.itic-insure.com

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