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Verification Guide

Commodity Fraud Warning Signs

Commodity fraud is structurally repetitive. The commodities change, the names change, the flags change; the underlying mechanics barely move. Learning a dozen structures provides durable protection because the structures are the fraud — everything else is set dressing.

The advance-fee structure

Every advance-fee operation converges on one moment: a payment from you before any independently verifiable event. It is costumed as registration fees, storage, insurance, taxes, legalization, courier charges, or 'release' payments. The costume varies; the direction of money before the direction of proof does not. Legitimate transactions can always be structured so that your first irrevocable payment follows independent verification.

Pressure and urgency

Artificial deadlines, competing buyers who are 'ready to close', allocations that expire tomorrow — urgency exists to make you skip the verification step that would end the conversation. A counterparty with real goods loses nothing by allowing normal diligence, and their reaction to a verification request is itself high-quality evidence.

Instrument theater

Strings of financial acronyms — ICPO with RWA, MT103 'screenshots', SBLC promises from unnamed banks — deployed early and confidently are a fluency display designed to make procedure questions feel naive. Real instruments are verified bank-to-bank, never by PDF, and real procedures survive being asked why each step exists.

Authority mirages

Mandates that cannot be traced to a titleholder, licenses from authorities that do not issue them, government connections offered instead of documents — unverifiable authority is not weak evidence of a deal, it is strong evidence of the absence of one.

Verification checklist

  • Any fee before independent verification: stop
  • Urgency replacing evidence: stop and verify anyway
  • Instruments offered as images or PDFs instead of bank-to-bank confirmation: stop
  • A mandate chain with any unverifiable link: treat as no mandate
  • Below-market pricing without a verifiable reason: assume fiction
  • Refusal of independent inspection: the answer is the evidence
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Related guides

Commodity Transaction Verification: The Three ProofsGold Seller Verification: What Must Be True Before You EngageSCO Verification: Reading a Soft Corporate Offer Critically