What are the irregularities may happen at the time of opening L/C?

Answer:

·        LC is opened against expired or fake IRC; genuineness of IRC is not ascertained before opening the LC.

·        LC is opened against false name without proper introduction of account.

·        LC is opened on behalf of the importer who has no account with the opening bank.

·        LC is opened without registration of LCAF where necessary.

·        LC is opened against expired LCAF or w2ithout revalidation of LCAF.

·        LC is opened without the verification of signature of the importer on LCAF.

·        LC is opened against unstamped LC application form or under stamped form.

·        LC is opened against false business name and bogus address.

·        LC is opened without obtaining CIB report from BB.

·        LC is opened against false PI/Indent/without verifying the Indentor Registration Certificate/Renewal Chalan/BB Indentor Registration Number.

·        LC is opened ignoring the validity of PI/Indent.

·        LC is opened ignoring the annual entitlement of the importer.

·        LC is opened without verifying the over/under invoicing of commodity price.

·        Competitive price of importable commodity is not ascertained.

·        LC is opened wrongly mentioning the HS Code or without mentioning the HS Code in the related papers.

·        If Importer/Exporter/Indentor is the same person, special measures are to be taken to avoid any fraud-forgery.

·        Shipment period extended by amendment after expiry of the LCAF.

·        False declaration of goods/banned items imported.

·        Submission of false Credit Report of supplier or opening of LC without obtaining Supplier Credit Report.

·        It is not learnt about the sources of fund which is required for retirement of documents sent against deferred LC.

·        LC is opened FOB or CIF basis without the concurrence of the competent authority.

·        Goods quality or quantity is not as per LC.

·        Non realization of LC margin as per HO approval.

·        LC is opened against false Insurance Cover Note. Risks are not same both in Cover Note and Insurance Policy.

·        Shipping documents are not examined by the opening bank in time.

·        Refusal notice against discrepant document is not served to the negotiating bank by the issuing bank as per UCPDC.

·        Acceptance of clauses B/L, Charter party B/L, Freight Forwarder B/L is made without complying LC terms.

·        Negotiation of discrepant documents and allowance of reimbursement is not done properly.

·        Application of exchange rate is not as per quoted rate.

·        IMP form is not properly filled in at the time of Return submission to BB.