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Concern About Fraud In Crude Oil Selling? 2 Percent Performance Bond Surest Proof of Genuine Seller


Involved About Fraud In Crude Oil Promoting? Why, for Consumers, getting the two % Efficiency Bond by the vendor is the Easiest & Surest Proof of a Real Vendor

Credible analysis has proven that, whereas just about each supposed crude oil vendor who goes to a possible crude purchaser to solicit enterprise, would virtually ALWAYS profusely forswear heaven and earth that he, or the crude oil he professes to be promoting, is “completely reliable, dependable, real, genuine, and sincere,” just about each OBJECTIVE, CREDIBLE EVIDENCE obtainable, however, provides a very reverse and opposite REALITY – specifically, that the overwhelming majority of those supposed sellers and their affords (in deed, as much as the extent of 99.999999%, based on one report) are completely pretend, bogus, fraudulent or not reputable.


The first instrumentality by which these fraudulent con artists and crude “sellers” function or perpetrate their con sport, is using skillfully cast or false paperwork. Such fraudulent and faux “sellers” – or, a minimum of, the last word masterminds who originate and stand behind the scheme – are infamous for being grasp forgers and glorious copiers of each conceivable reputable refinery and authorities company paperwork associated to crude gross sales or purchases. In deed, based on consultants, so masterful at this sport are these fraudsters, that the paperwork they supply to potential consumers are sometimes so strikingly convincing and real-looking that they’re incessantly plain tough, if not unimaginable, for nearly all however essentially the most expert of doc authentication consultants to right away distinguish from the actual and genuine ones.

As one report by the Fraud Watch Worldwide summed it up, “Victims [of such fraud] are sometimes satisfied of the authenticity of Advance Payment Fraud schemes by the cast or false paperwork bearing apparently official Nigerian authorities letterhead, seals, in addition to false letters of credit score, fee schedules and financial institution drafts.”

The U.S. State Division’s Bureau of Worldwide Narcotics and Legislation Enforcement Affairs, in a report titled “Nigeria Superior Payment Fraud,” describes the paperwork employed by the Nigerian Superior Payment Fraud (AFF) or 419 perpetrators, as “official-looking stationery with acceptable authorities seals, stamps, and signatures,” whose high quality, it says, has “advanced through the years, from poorly handwritten letters to extra skilled merchandise ready on phrase processors. Phrase processors additionally enable AFF criminals to generate extra letters.” It provides that the “AFF criminals embrace university-educated professionals who’re the very best on this planet for nonviolent spectacular crimes.”


The purpose is that, largely in consequence of the above actuality, for critical worldwide consumers of Nigerian crude oil, the one most important and most tough and dangerous drawback they confront within the open market, is now typically the verification and affirmation of the vendor’s claims about having an genuine crude allocation and/or its present availability, and the affirmation of the proofs and paperwork submitted by them in assist of these claims. For many consumers, enterprise that activity is usually dreaded and considered as one thing fraught with huge dangers and uncertainties that ought to solely be threaded with the utmost warning, and the best care and deliberation.


As a result of verification and affirmation of such paperwork from sellers are typically so tough and dicey, most such worldwide crude oil consumers search, due to this fact, to purchase ONLY from sellers who can present them what they contemplate the most secure, most tangible, and most simply dependable type of proof and proof of credibility by a vendor. And what’s this “most well-liked” proof and proof that almost all consumers would relatively have? It’s merely this – the supply by a vendor of a 2% Efficiency Bond (PB) to the customer.


In a phrase, the same old proofs and proof of crude allocation and availability provided by sellers to potential consumers, is usually the supply 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 everyday method by which a supposed crude oil vendor exhibits “proof” or proof to a possible purchaser that the Vendor has a real crude allocation or crude obtainable to promote, is for the vendor to supply the customer the PROOF OF PRODUCT, and the customer is requested to “confirm and ensure” the authenticity of this on his personal, and, upon that, for the consumers to subject their Financial institution Assure or Letter of Credit score (or different fee instrument) to cowl the acquisition price of the product at supply.

However the issue with this conventional technique, is that for many worldwide crude consumers, the common Nigerian vendor’s POP (an array of paperwork that would embrace the present loaded vessel paperwork, present Authority to Board (ATB) that was particularly issued to the preliminary purchaser (consignee) of the crude in whose title the vessel was issued, Certificates of high quality, Certificates of origin, Cargo manifest, Vessel ullage report, Certificates of amount, Invoice of lading, the Bulk Allocation Particulars, the Vendor’s Authority to Promote (ATS) from the NNPC, and so forth), is NOT dependable or readily verifiable for genuineness. For instance, the POP, which is, in a phrase, the vendor’s principal doc that is meant to show to the customer that the vendor really has the product being bought, is perhaps displaying that an proprietor of the oil allocation or commodity has possession of the product as of the precise time of the transaction, say, at a sure hour of the day as we speak. However but, there isn’t any assure that the product may not have been bought to a different purchaser simply hours, and even minutes, proper after that transaction, and that the commodity is definitely nonetheless obtainable on the market or supply to the customer.

“Most consumers don’t settle for Nigerian sellers’ proof of product (POP),” says Sam Nelson, an skilled in crude shopping for and promoting strategies and the writer of a primer on the topic. “Because of this, they (the Consumers) need a tangible (Bodily) proof of product. The client would request that the vendor examine the cargo and current a verifiable inspection report from accredited businesses like SGS, Q & Q or Robinson Worldwide earlier than they (the Consumers) will constitution a vessel for the transaction. It’s because some so-called Nigerian sellers have false declare over merchandise that by no means existed and they’d forge paperwork to current as POP. Nigerian market must be adopted very fastidiously and all documentations completely verified.”

Nelson provides: “Please don’t give any inspection cash to the vendor. All the time pay the cash on to the inspection firm after they’ve collected samples of the crude oil from the mom vessel for chemical evaluation to verify the standard and amount of the crude within 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 paperwork as genuine should you didn’t confirm it from the captain of the feeder vessel. Any documentation from a Nigeria vendor have to be verified for authenticity.”


In deed, these days, the identical drawback of basic incapacity to definitively authenticate real crude allocation or availability, now pervades even conditions the place “tangible, bodily” POP inspection has supposedly been made. And a few consumers discover that even this cautionary recommendation by Nelson, that the consumers ought to “insist that the ATB (Authority To Board) from the vessel for inspection originated from the captain of that vessel,” would typically not fairly work any extra in lots of conditions as we speak.

In a TTO deal, for instance, the actual fact of the consumers’ representatives boarding the vessel to make an “inspection” or “affirmation” of the “loaded” vessel, is usually no extra a assure that the transaction is essentially real or reputable. Nigerian con males and 419ers who function within the crude oil trade, 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 customer’s representatives and his appointed SGS inspectors invited to return aboard the ship on a presumed ship “captain’s” ATB doc, have been identified to be really organized by pretend ship operators and ship managers and “captains”; and in such circumstances the customer will solely be taking on a ship and cargo with FAKE Constitution Social gathering Settlement executed between the customer and faux ship supervisor, with no AUTHENTIC ship proprietor’s approval and no genuine delivery paperwork. And as soon as the customer’s representatives aboard the vessel confirms that the vessel is “pregnant,” the customer pays for the cargo, takes over the vessel, and the con males shortly break up the cash and vanish. The client losses every thing for the reason that reputable vessel proprietor by no means licensed the captain to subject the CPA, and the important cargo delivery paperwork used within the transaction are all merely pretend.

Nigeria’s bureaucratic quagmire

And there is yet one more drawback concerned in attempting to authenticate Nigerian crude oil paperwork. The issue of the bureaucratic quagmire related to doing enterprise in Nigeria. One skilled vastly skilled in doing crude oil shopping for enterprise in Nigeria, put it this method to this author: “NNPC Crude Oil Advertising and marketing Division, Abuja, is the authoritative supply to confirm the Authority to Promote doc. However you’ll spend an countless period of time attempting to confirm it. As with most Nigerian institutions, folks use private connections to get such paperwork, however that doesn’t imply that they’ll ship.”


In brief, the purpose is that just about all conventional manners of verification and affirmation of crude oil possession and availability have turn out to be severely contaminated and adulterated by con artists and faux operators to the purpose that many worldwide crude oil consumers regard these strategies as largely unreliable, too tough to confirm, and fraught with insupportable dangers. And consequently, there has advanced amongst them what might as we speak be known as a “most well-liked” technique for figuring out an genuine and credible vendor of crude oil in as we speak’s market. Such a vendor is solely one who can meet one fundamental requirement – specifically, is keen and in a position to present the customer a 2% Efficiency Bond upfront in a transaction.

What’s a Efficiency Bond or PB?

That is, in a phrase, an insurance coverage doc issued for the vendor by vendor’s financial institution or insurance coverage firm guaranteeing that the issuer pays a stipulated quantity (a sum amounting, on this case, to 2% of the full worth of the cargo being bought) to the customer within the occasion that the vendor breaches (fails to carry out) the phrases and specifics of the contract signed by the vendor with the customer. (The Efficiency Bond may be posted within the type of a Money Bond). The financial institution or insurance coverage firm which points the PB acts because the accountable “surety” of the bond

If a vendor contracts with a purchaser to place up a 2% PB – and is ready to really submit that bond along with his financial institution or insurance coverage firm – the vendor is, in a phrase, guaranteeing the customer that if he have been to fail to carry out his obligations beneath that contract, his financial institution or insurance coverage firm, of their roles because the “surety” of the bond, pays the customer a sum amounting to 2% of the worth of the crude being bought, regardless.


Consumers love discovering sellers who can present them UPFRONT 2% Efficiency Bond, overwhelmingly viewing that because the “most well-liked” possibility as they contemplate that the most secure, most dependable, most tangible, and most assured and least fraud-prone type of proof and proof of credibility by a vendor. Most consultants contend that if a vendor can provide a 2% PB deal – and, what’s much more essential, is definitely in a position to submit the PB as a result of he has the monetary wherewithal to take action – it’s virtually assured that the vendor won’t fail the customer within the precise execution of the deal, however will virtually certainly carry out these obligations as contracted with the customer.

Sam Nelson, skilled in crude shopping for and promoting strategies and the writer of a primer on the topic, put it this manner: “A contract with any of those bonds in place will likely be efficiently accomplished. A bonded contract has the next diploma of success than a non-bonded contract. A bonded contract is a bankable contract. The gamers have their cash at stake and that could be a good motive for them to carry out.”

And the Authorized Dictionary explains it this manner: “The aim of a bond is to supply an incentive for the success of an obligation. It additionally supplies reassurance that the duty will likely be fulfilled and that compensation is on the market if it’s not fulfilled. Efficiency Bonds assure for the passable completion of a challenge.”

There are a couple of particular bases why consumers and consultants really feel that means:

1. Having the ability to submit a PB is an indication of monetary credibility and skill.

To have the ability to finance an precise posting of a 2% PB (which can imply, for instance, on the present crude costs, 2% of, say, $200 million for a 2 million barrels cargo, one thing amounting to $4 million), a vendor must have some substantial monetary capability and assets.

2. Monetary Value and Penalty Concerned In Posting a PB, is a Highly effective Disincentive To not Carry out.

Sam Nelson: “The gamers have their cash at stake and that could be a good motive for them to carry out.” In deed, most consumers, upon getting the two% PB issuance from a vendor, would promptly settle for that as equal to POP and forgo having to evaluate the POP.

3. The Regular Con Man or 419er Will Not Have the Disposition, the Fame & Monetary Wherewithal to Put up a PB.

Robert Strickland of Strickland Associates, an skilled New York seller in crude oil offers, says as follows: “In case you are involved with FRAUD! ONLY true Sellers that provide a 2%+ Efficiency Bond are real Sellers of Nigeria [crude oil].”

Sam Nelson, the crude oil offers skilled and writer: “These bonds are crucial to guard the curiosity of the events concerned for pointless losses resulting from fraud or full negligence.”

4. Having the ability to submit a PB is a strong indication to a purchaser that the Vendor has already been vetted.

Acquiring a PB is usually not a simple or automated factor. Earlier than a financial institution or insurance coverage firm would give a vendor a bond, the vendor shall have gone by means of a rigorous utility course of, and should have met a set of stringent monetary and character necessities and situations. Therefore, when a purchaser will get a vendor who can, and does really, submit a 2% PB, the customer is sort of assured that he is bought a reputable vendor, and one very unlikely to be a fraudster or a 419er.

For simply an instance, one Syracuse, New York, insurance coverage firm requires candidates for a Public Building job PB to supply them the next objects, amongst others:

Surety Questionnaire Crammed Out Fully

Copy of Contract/Award Letter or Solicitation Letter

Enterprise Monetary Statements (2 years audited fiscal yr financials) OR

Final 3 years Firm Earnings Tax Returns

Private Monetary Statements and Resumes on all homeowners of 10% or extra

Work in Progress Schedule (if relevant)

Insurance coverage Affirmation

A. Workman’s Compensation

B. Legal responsibility Certificates

C. Key Man Coverage

Provider and Contractor Reference Letters

Schedule of Accomplished Jobs

Financial institution Reference Letter

Firm and Private Indemnification (GAI we provide)

Articles of Incorporation

Company Decision

Job Value Breakdown and/or bid specs


To most consumers of crude oil within the worldwide open market, getting an UPFRONT 2% Efficiency Bond issuance from a vendor, is the overwhelmingly “most well-liked” technique for doing a gross sales/buy deal. It’s the possibility they contemplate to be the most secure, most dependable, most tangible, and most assured and least fraud-prone type of proof and proof of credibility by a vendor.

For varied causes and components, a lot of that are outlined above, most consumers and consultants consider that if a vendor can provide a 2% PB deal – and, what’s much more essential, is definitely in a position to submit the PB as a result of he has the monetary wherewithal to take action – it’s virtually assured that the vendor won’t fail the customer within the precise execution of the deal, however will virtually certainly carry out his personal obligations as contracted with the customer. Therefore, in a deal of that sort the customer has little or nothing to fret about regarding a possible threat of fraud or rip-off. In consequence, consumers love discovering sellers who can present them – who can really submit – a 2% PB, and contemplate that to be the very best proof and assurance of getting a reputable vendor, and one very unlikely to not carry out the contract, or to be a fraudster or a 419er

NOTE: As with many issues regarding many a Nigerian crude vendor, it is one factor for a vendor to assert to a purchaser that he’ll submit the PB, however fairly one other factor altogether for the vendor to have the ability to really do it, or to really do it!),.



INSTRUCTION: You are able to do so. You possibly can readily receive the precise fundamental necessities you’d want to satisfy so as so that you can turn out to be routinely thought of “confirmed” as a very LEGITIMATE vendor who actually genuinely has some crude to promote. USE THE AUTHOR’S FIVE BASIC OPTIONS PROGRAM.

Simply ship an electronic mail and easily ask for “the FIVE OPTIONS.” CONTACT THE AUTHOR ON THIS ONLY BY EMAIL, PLEASE, at: [email protected] OR [email protected]

MORE ON THIS AND RELATED TOPICS ON THE AUTHOR’S BLOG AT: http://www.affordablebankruptcy.blogspot.com/


Source by Benjamin Anosike, PhD

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