AGI Inc. has an innovative solution to help stopping fraud in international and domestic Letters of Credit and deliveries of merchandise. The solution, which is very simple, is to include a “window” of a few days between the approval of the documents and the actual payment to the seller so the buyer can go to court and stop the payment if there is fraud and/or material forgery.
BANK OF AMERICA, agreed to establish a checking Trust Account for customers of AGI Inc. who will deposit money to pay for their imports under certain conditions. AGI Inc. will issue irrevocable Letters of Credit to fund the customers' imports. Each deposit in this account will be separated by the Trust. Payment will be issued by the Trust against documents presented to AGI and complying with the terms of the Letters of Credit. If not complied with the terms of the Letter of Credit, the Trust will return the documents and send the deposit back to the depositor.
The majority of insurance policies that cover transportation exclude fraud from the policies, including “all risks” policies. Therefore, in the event of fraud in the shipment, the buyer is exposed and is not covered, except if it uses our innovation of the “window” and covers its loss. This coverage is cheap, practical, and fast.
Ar Gil, the president of AGI, devised a completely new approach to tackling transportation problems of material fraud and forgery. Normally, the documents (bill of lading, etc.) are checked, and, if complied with the terms of the letter of credit, payment to the seller (beneficiary) follows swiftly (at sight). Only then, after payment to the seller (beneficiary), the documents are released to the buyer who examines the merchandise. If there was a fraud or forgery in the shipment, it may be too late to recuperate the payment.
Ar Gil also contends that the mere knowledge of the "window" will deter evil perpetrators.
Ar Gil wants to emphasize the fact that if the Letter of Credit is worded as a standby Letter of Credit, the risk of fraud is increased, the reason being that the payment is almost unconditional. Ar Gil said: “I know of a transportation case which was fraudulent and the importer suffered close to $1 MILLION dollars damage.”
Both texts of Brochure 600 and Article 5 of the Letter of Credit Law sanction changes in the rules which modify or exclude provisions in the Letter of Credit, or, in the case of the Uniform Commercial Code Article 5-103 "may be varied by agreement or statements".
About AGI Inc.
AGI Inc., a legal research firm, was opened to help with estimates for car repairs and complaints about completed work. After years of operation, AGI has slowly transformed into a letter of credit issuer for importers and exporters willing to do international business. AGI’s goal has always been to reduce fraud and forgery in business transactions. As an example, AGI fought against a Federal decision to support a Federal Regulation and lost. They appealed to the Federal Court of Appeals, and the Regulation was cancelled.
About Ar Gil
Ar Gil is the president of AGI Inc. He’s a retired lawyer and banker with many years of experience and has specific expertise in Letters of Credit. Ar has already represented himself in state and federal courts in different cases. He also worked as an importer and exporter where he learned a lot about international business.
330 Pony Farm Road, Suite #1
Oneonta, NY, 13820