Up till this date Mr Jones by now would have tried to cash a dozens of SBLCs already – from Russia, and later Azerbaijan, then Bangladesh and later even Nigeria!! OMG!!! Sadly to no avail. Why ? After discussing this over and over with my clients. Even if he is not a fraud he is maybe too ignorant and naive to believe that SBLCs floating about in the market can be monetized, especially if it comes from such countires? Mr Jones – I hope you are an ignorama and not a fraudster!
The FEDS (Federal Reserve and the FBI) may have a field day!
According to my experience SBLCs are not meant to be done that way. The company that wants to cash something of a substantial amount say 10-20M would first need to be of good standing with the bank. And your company revenue would need to be at least 100M and above to be able to cash something like that. Trading companies can easily cash that as most of their annual revenue runs up to 10M and above per year. Secondly, the format of the SBLCs needs to get clearance from the bank. Because people out there just thought that if the bank is able to receive the MT 760 it would be able to cash. Which is not true. Until the bank approves the format of the SBLC and given its clearance then can it be presented to the bank for clearance. And it is best to craft the SBLC to the favor of the beneficiary bank.