Study On The Risk Prevention Mechanism Of Letter Of Credit Fraud

As a method of payment in international trade,letters of eredit are widely used and and occupy an extremely important position in the protection and completion of transact ions.The reason why letters of credit are widely used is that they have solved the "pain spot" of trust between buyers and sellers,and in particular they promote the develoment of global trade.The emergence of the letters of credit solves the contradietion point of trust between international traders in the transaction process,relieves conflicts between the parties,and shares the risks.Most of the traders in international trade adopt the payment with letter of credit,and the probability of letters of credit appearing in international trade is gradually increasing.In particular,the’fraud of letters of credit has occurred from time to time.However,there are fewer special laws and regulations developed in response to the fraud of letters of credit in China.In addition,the burden of proof and the standard of evidence for fraud are at a low level,and the judges have large discretion,so the legitimate rights and interests of paities are damaged,the international trade development has been destroyed,the judicial authority of China has been shaken,and thus poses certain obstacles for China to build into a country featured by free,democratic and developed socialist legal system.china is a major international trading country,and its trade volume is in a leading posit ion all over the world.Especially after joining the international organizations such as APEC,the volume of trade has surged.However,compared with the countries with relatively improved relief system for fraud of letters of credit,China’ s relief system lags far behind them in both judicial practice and legislative status,and the imperfection of the system for fraud of letter of credit poses a threat to China’ s financial security.The author’ s study on the risk prevention issue of the fraud of letter of credit from different legal perspectives is conducive to accelerating the establishment of the letter of credit system,strengthening the prevention measures for fraud of letter of credit,improving the legal system for regulating fraud of letter of credit,and protecting the legitimate rights and interests of the country and the trade parties.