Fraud as a Reason for Seizure of documentary of Credit (LC)

Abstract

This study dealt with fraud as one of the reasons for seizure of letter of credit (LC). The researcher used the descriptive approach by describing fraud, its forms, conditions and means of proof, and the analytical approach by analyzing the legal texts contained in the Jordanian Trade Law and the unified norms.

This study has reached several results, the most important of which is the principle of banking independence, which is intended to examine documents that conform to the international contract with the terms of the letter of credit, without the obligation to examine the extent of their conformity with the goods or contracts associated with them, which allowed some people to commit cheating and fraud to harm the rights. This led to harm to the beneficiaries and banks.

Seizure is one of the most important means that prevents the implementation of the letter of credit (LC) in case of cheating, fraud and other illegal acts, and temporary measures that precede the filing of a right case. This study made several recommendations, the most important of which is the establishment of independent rules regarding the seizure of the LC, taking into account the privacy of this type of seizure.