Sometimes new inexperienced importers fall victim to import scams and frauds. Here is one of the cases we’ve been dealing with.
We received a call from a U.S. company asking us to help them resolve issues with shipment and customs clearance of household devices shipped from the United Kingdom.
The importer provided us with the following information:
Invoice; the tracking number of the courier service Flawless S A Express Service; Correspondence with a person who claimed to be a shipper representative. Air Waybill had not been provided.
The issue. The shipper’s representative informed the importer that the shipment had arrived in the United States. She requested $3,499 for the release of the shipment from the custody of the carrier. No documentation justifying the charges had been provided. The representative claimed that the carrier would not release the shipment until the requested chargers were paid.
Payment Request
The $3,499 bill included following charges:
- Importation License – $1,199;
- Road expenses – $600;
- Clearance license – $770;
- Import tax fee – $930.
Here is our analysis of the request, showing import scams:
1. “Importation License” term does not exist in U.S. Customs regulations. Import license was not required for the article in question. Therefore, the charge of $1,199 was not justified.
2. The invoice from the seller had a remark “shipping included.” For that reason “Road Expenses” charge of $600 was not justified;
3. “Clearance license” term does not exist in U.S. Customs regulations. Customs clearance can be done by the Importer of record (no license required) or by a licensed Customs broker. Therefore $770 charge was not justified.
4. “Import tax fee” term does not exist in the U.S. Customs regulations. Customs duties on the articles in question – Free. Thus $930 charge was not justified.
Import Scams
In conclusion, the ”shipper’s representative” used the language and demanded the charges that clearly showed that the request had not been written by a professional in the shipping industry. Also, she requested the payment by Western Union to a person outside of the United States.
Also, the importer was unable to locate the shipment using the tracking number.
Given these points, our experts concluded that the importer fell victim to a scam. We suggested the company to contact the Federal Trade Commission to report the case as import scams.
4 Things You Can Do to Avoid Import Fraud
1. Know the foreign seller.
- Study their website, call their office, and ask the right questions before paying them. Read their content carefully;
- Look for the owner of the domain by paying attention to their link and researching it well online;
- Call the numbers on the website;
- If you are dealing with a small seller who doesn’t have a website, you can check supplier’s information on a marketplace, such as Alibaba.
2. Check Shipping Company.
If you hire a shipping company to deliver merchandise from a foreign country, make sure it is not a fake shipping company. Check their website, ask for referrals, contact their agent in the US.
3. Consider how you pay.
Credit cards have significant fraud protection built-in, but some payment methods don’t. Wiring money through services like Western Union or MoneyGram is risky because it’s nearly impossible to get your money back. Honest companies won’t require you to use these payment methods.
4. Do not make decisions in a hurry when you receive an unexpected request.
Con artists can steal some information on your shipment. Then they would act as “shipping agent” or “shipping representative” to demand you to cover additional shipping charges or “customs clearance” charges.
Always contact the parties you are working with when you receive a suspicious payment request.