The Ministry of Agriculture and Rural Development (MARD) said that after receiving a document from the Vietnam Pepper Association (VPA) reporting that there are a number of items, including pepper, star anise, cashew, and cinnamon from Vietnam  exported to the UAE showing signs of commercial fraud, the ministry has sent a note to the Embassy of the United Arab Emirates (UAE) in Hà Nội.

At the same time, it requested the support of the embassy in solving an urgent problem related to trade fraud for Vietnamese spices exported to the UAE.

The VPA reported that some of its members had exported peppercorn, cinnamon, star anise, and cashew nuts to the UAE but found signs of scams from the same buyer (Bab A1 Rehab Foodstuff Trading LLC) and the same bank (Ajman Bank JSC) based in Dubai.

They lost four containers of the produce worth US$400,000 when the goods arrived at Jebel Ali Port in the UAE. They are now at risk of losing one container of star anise scheduled to arrive at the port yesterday.

To prevent the loss of the star anise container and trace the swindling importer, the MARD has also asked the UAE Embassy to propose UAE authorities temporarily seize the star anise container at the port and investigate the four stolen batches.

Previously, VPA had sent official dispatches to report to the Ministry of Industry and Trade, the Ministry of Foreign Affairs, the Ministry of Agriculture and Rural Development, and the State Bank of Việt Nam on the urgent situation of the incident and requested the relevant agencies to urgently work with the authorities of Dubai to block the buyer or buyer's representative who obtained the original documents of the anise container before Wednesday.

As soon as receiving the report, the Ministry of Industry and Trade (MoIT)’s Asia - Africa Market Department sent a diplomatic note to the UAE Embassy in Việt Nam to ask the embassy to inform competent agencies of its country to deal with the case.

On Tuesday, the MoIT had an urgent meeting with the UAE Embassy, the State Bank of Việt Nam, the VPA, the Foreign Trade Agency, and the businesses owning the export batches.

It also ordered the Vietnamese Trade Office in the UAE to quickly handle the case.

The MoIT recommended on Tuesday that Vietnamese companies be cautious and thoroughly negotiate payment clauses when conducting transactions with foreign firms, following a suspected scam involving five batches of Vietnamese farm produce in Dubai.

It said that scams in the Middle East have increased recently, mostly involving small trading companies.

The most common trick is that when signing contracts, foreign enterprises often request Vietnamese companies to make telegraphic transfers (TT), or they issue cheques as pledges to sellers. Both are the forms of payment with the highest risks.

TT is a form of payment in which buyers will pay sellers after receiving goods. In cheque issuance, buyers may issue cheques without money in their bank accounts while sellers are unable to come to the banks of buyers to receive money since they do not have identity cards. Sellers are also unable to check information of buyers’ accounts as banks in some Middle Eastern countries do not provide customer information for a third party.

Given this, the MoIT called on Vietnamese companies to be cautious and thoroughly negotiate payment clauses to ensure safety.

It recommended they use letters of credit (L/C) or send representatives to directly meet buyers to hand over documents and receive payments. The documents against payment (D/P) is also safer than the TT and cheque payments, but businesses need to ensure safety when handing over documents to the banks of buyers. — VNS