Trade finance fraud detection that checks the cargo, not only the documents, before anything is funded
Every cargo fingerprinted and checked against the bank's own financing before funding.
See one case, screen by screen ↓Trade Finance Fraud Detection checks every trade financing before it is funded for the signs of trade finance fraud: duplicate financing of one cargo, forged or antedated bills of lading and phantom shipments. Agents fingerprint the cargo, search every desk at the bank and the electronic bill of lading registry for any part of it, check the bill with the carrier, place the ship on the on-board date and verify the container numbers. A fraud analyst holds or releases, and a credit risk officer confirms.
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Trade finance fraud rarely looks like fraud on paper. A trader finances one cargo several times: a receivable at one desk, a letter of credit presentation at another, an inventory loan at a third, with the bill of lading antedated or two container numbers retyped. Document examiners check each presentation against the credit under UCP 600 within five banking days, and a forged or altered bill complies on its face. Each desk sits on its own system, so nobody asks whether this cargo was financed before.
The questions that stop a fraud are physical. Did the carrier issue this bill, and with this on-board date? Was the ship at the port of loading that day? Do the container numbers exist? Answering them by hand means calls to other desks, the carrier and a vessel tracking service, which does not fit a funding window. In the 2020 commodity trader collapses, the trade finance fraud cases that followed showed the same cargo financed at several banks with duplicate or altered bills of lading.
Estimated split for checking one large LC presentation against other desks and the physical world by hand, and with the solution. By hand the work does not fit a 4-hour funding window, which is why it is rarely done.
Eight agents fingerprint, search, verify and argue each cargo; the analyst decides and a credit risk officer signs.
Friday 2 October 2026, 09:12. Documents arrive for Marlow Commodities Trading under Corvane National Bank's import letter of credit CNB-ILC-26-04102, issued for its customer Brightwater Wire & Cable Co.: 4,000 tonnes of copper cathode at $9,220 a tonne, $36,880,000 at sight. Here is what happens next, screen by screen, in the working solution.
Rhea's queue holds every LC presentation, documentary collection, trade loan, receivables and supply chain finance request of the day, 52 events so far, each with its funding window clock and what the agents found. Two need her decision for the same reason: the presentation TFC-26-10418 for $36,880,000 and the trade loan TFC-26-10421 for $30,000,000 both carry a cargo already financed.
“Cargo already financed”: the result the agents wrote on both checks.
The agents read the bill of lading, invoice, packing list and weight certificate and write the cargo fingerprint: bill of lading KSTR-260918-0442, Kestrel Ocean Line, Kestrel Halcyon voyage KH638S, 160 containers, 4,000.000 t copper cathode, on board 14 Sep 2026, Antofagasta to Houston. The parts found in another financing are marked. The funding window shows 1 h 32 m left, and the UCP 600 examination period ends on Friday 9 October.
One decision at the foot of the screen: Hold funding or Release.
The finder searches 24 months of financing at every desk and the electronic bill of lading registry for any part of the fingerprint. RF-26-11873, a receivables financing that advanced $32,868,000 on 21 Sep, shares the bill number, carrier, vessel and voyage, goods and weight, route and 158 of the 160 containers: Strong 94. Trade loan TL-26-01206, requested on 1 Oct and not funded, shares 158 of the same containers: Strong 71. A documentary collection on the same voyage with different cargo is marked Expected and explained, not held.
Matching by part of the cargo, not by an exact copy, is what catches an altered bill.
The carrier's record has the same bill number, shipper and vessel, but shipped on board 19 Sep 2026, not 14 Sep. The copy behind the receivables financing also says 19 Sep. Two container numbers differ: KSTU 418843 3 and KSTU 419065 7 on the presented bill, KSTU 418834 3 and KSTU 419056 7 in the carrier's record. The registry holds no electronic record; the carrier confirms a paper bill.
The true on-board date falls after the credit's latest shipment date of 15 Sep: an antedated bill hides a late shipment.
Vessel tracking data place Kestrel Halcyon at 6°24′ N, 80°30′ W, off Panama, at 12:00 UTC on 14 Sep, 1,899 nautical miles from Antofagasta. It arrived there on 19 Sep at 01:10 and sailed on 20 Sep at 02:15. The port calls and each position report are cited.
The Voyage checker never concludes on a gap in the ship's signal alone; it shows the gap.
Every container's ISO 6346 check digit is computed with the working shown. For KSTU 418843 3 the sum is 4,653, mod 11 gives 0, so the check digit should be 0, not 3. Two of 160 fail, neither is on the carrier's manifest, and the copy behind RF-26-11873 carries the valid numbers with two digits swapped.
The checker never corrects a number; it shows the computed digit.
The Skeptic ranks every explanation, the innocent ones too, and names the one record that would disprove each. One cargo financed twice, with the bill antedated to meet the latest shipment date: 86%, disproved only by a second genuine bill for a 14 Sep loading, and the carrier says there is none. Two genuine shipments of the same size: 6%. A carrier clerical error: 5%. The receivables sale canceled: 3%.
Rhea can ask the Skeptic back: “What if the carrier simply stamped the wrong date?”
Rhea holds funding with the reason codes the agents suggest, HC-01 to HC-04, and a note they drafted. The same decision also holds the pending trade loan TL-26-01206. RF-26-11873 is already funded, so its desk is told. The hold takes effect at once and goes to a credit risk officer to confirm.
“USD 66,880,000 held across 2 financings.”
Marcus sees the hold, the maker, the reason codes, what the agents found with each citation and Rhea's note on one screen, and confirms as checker. On confirmation a case opens for Theo Brandt, a SAR decision referral goes to Gloria Nakamura, due 1 Nov 2026, and trade counsel is asked to advise before 9 Oct.
The maker can never be the checker.
Case FIC-26-0031 opens with the evidence, the linked financings and the timeline: $99,748,000 financed on one cargo worth about $36.9 million. The SAR decision is restricted to the Fraud Investigations Manager and the BSA Officer. The customer-facing view of the letter of credit shows only “Presentation under review”.
No SAR, referral or hint of one reaches a customer-facing or relationship view.
The same cargo, seen by the five people at Corvane National Bank who carry it: what their day looked like, and what it looks like now.
Eight agents fingerprint, search, verify and argue each cargo; the analyst decides and a credit risk officer signs.
Reads the bill of lading, invoice, packing list and weight certificate, and writes the cargo fingerprint: bill number, carrier, vessel and voyage, containers, goods and weight, on-board date, ports and parties.
Searches LCs, documentary collections, trade loans, receivables, supply chain and inventory finance at the bank over 24 months, and the electronic bill of lading registry, for any shared part of the fingerprint; scores each match and says which parts matched.
Asks the carrier's tracking service and the registry whether the bill exists and what it says, for bill of lading verification before funding.
Places the vessel on the on-board date from vessel tracking data, with its port calls and its distance from the port of loading.
Computes ISO 6346 check digits, compares owner codes with the carrier and the container count with the weight.
Compares the unit price with prior shipments between the same parties and the market, and looks at routing and trade-based money laundering red flags.
Ranks how a fraud would have to work for the documents to look as they do, argues the innocent case and names the evidence that would disprove each explanation.
Drafts the hold memo, the checker summary, the fraud referral, the SAR decision referral and the request to trade counsel.
Hold, confirm, release. The agents propose; a named person decides.
Ask in plain words, or say what to change. Every answer points to the record it came from.
Why is TFC-26-10418 a cargo collision?
The same cargo was financed 11 days ago. Receivables request RF-26-11873 carries the same bill, KSTR-260918-0442, and 158 of its 160 containers. The carrier says the copper went on board on 19 Sep, not 14 Sep, and on 14 Sep the ship was 1,899 nm from Antofagasta.
What else is financed on Marlow's cargo?
Three financings touch the copper on Kestrel Halcyon: RF-26-11873, USD 32,868,000 advanced; this LC presentation, USD 36,880,000; and trade loan TL-26-01206, USD 30,000,000 requested. Exposure on one cargo worth about USD 36.9M: USD 99,748,000.
Which checks could miss the 4-hour window?
Two are close: TFC-26-10431, Ceylan Dried Fruits, 1 h 11 m left, where vessel data has a 31-hour gap; and TFC-26-10418, Marlow, 1 h 32 m left, which needs your decision.
Hold any check where 90% or more of the containers were financed before
Done, as a proposal. New rule: “Container set shared at 90% or more with any financing in 24 months → propose a hold (HC-01).” It takes effect when Kai Whitfield approves it as rules v15; until then it shows as pending in Settings.
13 screens from the working solution, on its sample data. Pick one to see it large.
How a match is scored, when a hold is proposed and who signs are settings, versioned and on the audit trail. A rule proposed through the assistant waits for the administrator's approval.
| Setting | Default | Choose from |
|---|---|---|
| Fingerprint part weights | B/L number 30 · containers 25 · goods and weight 15 · vessel and voyage 10 · on-board date 10 · parties 10 | Step each weight up or down; the weights add to 100 |
| Propose a hold at a match score of | 60 | From 30 to 90, in steps of 5 |
| Call a match “expected” below | 30 | Shown and explained, never held |
| Look back | 24 months | 12 · 24 · 36 months |
| Checker on releases over | USD 1,000,000 | And always on every hold and every release of a hold |
| Pre-funding window | 4 hours | Warning to the analyst at 3 hours; escalation to the Head of Trade Operations at 4 |
| Confidence threshold | 0.80 | Below it a finding shows as “needs a person”, never as a pass or a fail |
| Retention | 5 years | From the decision (31 CFR 1010.430); a legal hold suspends deletion |
Every figure is labelled: a target the solution is built to, an estimate, a typical published result, or a proven one.
“demo” = seen in the working solution, on its sample data · “target” = the design goal, measured in the live solution · “estimated” = our estimate · “typical” = published figures (GTR, Facing up to fraud, 2020: 23 banks owed USD 3.5 billion after one trader's collapse; AJOT reporting Bloomberg: a USD 9 billion credit hit across the 2020 collapses; ICC United Kingdom: about 80% of bills of lading and 60% of trade finance on paper). Rules named for context: ICC UCP 600 (articles 5, 14 and 16), UCC 5-109, ISO 6346, 31 CFR 1020.320 (SARs), 31 CFR 1010.430 (record retention), GLBA. Corvane National Bank, its customers, the traders, carriers, vessels, financings, containers and the people named on this page are fictional: characters and sample data in the working solution.
Trade Finance Fraud Detection checks every trade financing before it is funded for the signs of trade finance fraud: duplicate financing of one cargo, forged or antedated bills of lading and phantom shipments. Agents fingerprint the cargo, search every desk at the bank and the electronic bill of lading registry for any part of it, check the bill with the carrier, place the ship on the on-board date and verify the container numbers. A fraud analyst holds or releases, and a credit risk officer confirms.
Duplicate financing is one cargo financed more than once, for example as a receivable at one desk and under a letter of credit at another. The Duplicate financing finder matches the cargo by its parts (bill number, container set, vessel and voyage, goods and weight, on-board date, parties) rather than by an exact copy, so “158 of 160 containers” still catches a bill with two numbers retyped. Each match says which parts matched and how strong it is.
The Carrier & registry verifier asks the carrier and the electronic bill of lading registry whether the bill exists and what it says. The Voyage checker places the ship on the claimed on-board date from vessel tracking data. In the sample case the carrier's record says 19 September, the bill says 14 September, and on the 14th the ship was 1,899 nautical miles from the port of loading.
Each container number's ISO 6346 check digit is computed with the working shown: every character's value times 2 to the power of its position, summed, then mod 11. A number that fails is flagged and compared with the carrier's manifest. The agent never corrects a number; it shows the computed digit.
No. Document examiners still check the presentation against the credit. This adds the checks a forged bill passes: whether the cargo is financed elsewhere at the bank, whether the carrier issued the bill, and whether the ship and containers match it. The UCP 600 examination clock is shown on every LC presentation, and an honor or refusal decision on fraud grounds is taken with trade counsel.
Yes. The agents propose and cite; only named people hold or release. A Trade Credit Risk Officer confirms every hold, every release of a hold and every release over $1,000,000, the maker can never be the checker, and an override of an agent proposal needs a reason code, a note and a checker.
A confirmed fraud becomes a restricted case for the Fraud Investigations Manager and a SAR decision referral for the BSA Officer, with its due date. No SAR, referral or hint of one appears on a customer-facing or relationship view, which shows only “Presentation under review”, and SAR content is left out of export packs.
The Agentic Solution Engine builds and deploys it from your requirements and documents: your fraud procedures, reason codes, approval limits and a sample of past presentations and financings. It goes live once every quality gate has passed. We will walk you through it on your own trade financings first.
Every discrepancy question gets a cited verdict in seconds, the reasoning kept for audit.
1-min demoCorrespondent Banking Due DiligenceEvery respondent's file rebuilt each cycle, with nesting checked against real payments.
1-min demoNostro ReconciliationEvery nostro break explained from its payment messages and cleared with two signatures.
1-min demoWe'll run Trade Finance Fraud Detection on a sample of your own past presentations, trade loans and receivables.