Countries losing "billions of dollars" to invoice fraud

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nformal traders at the Wynberg Taxi rank in Cape Town, South Africa. Photo: World Bank/John Hogg

Some developing countries are losing as much as 67 per cent of their exports worth "billions of dollars" to invoice fraud, according to the UN Conference on Trade and Development (UNCTAD).

Invoice fraud or "trade misinvoicing" is the deliberate misreporting of the value of a commercial transaction on an invoice submitted to customs.

These commodity-dependent countries lose valuable foreign exchange earnings, taxes and income that might otherwise be spent on development, the agency says.

Jocelyne Sambira reports.

The findings were released on Saturday during a Global Commodities Forum organized by UNCTAD in Nairobi, Kenya.

Trade misinvoicing is thought to be one of the largest drivers of illicit financial flows from developing countries.

The study uses up to two decades' worth of data covering exports of commodities such as cocoa, copper, gold and oil from Chile, Côte d'Ivoire, Nigeria, South Africa and Zambia.

The underinvoicing of gold exports from South Africa amounted to a little over US$78 billion or 67 per cent of total gold exports between 2000 and 2014.

And in Nigeria, underinvoicing of oil exports to the United States was worth US$69 billion between 1996 and 2014.

Commodity exports may account for up to 90 per cent of a developing country's total export earnings, the agency says.

Jocelyne Sambira, United Nations.

Duration: 1’02”

 

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