Transnational fraud has paralleled the growth of world trade, the development of a global system of financial services and the emergence of a sophisticated communications network that is shrinking one’s sense of time and space. Singapore is a major link in this network of world trade, finance and communications.

Fraud requires a clever manipulation of this global network. Given our regard for intelligence and our opprobrium for violence, and the blurring of one’s notion of honesty by avarice stimulated by commerce, there is much less outrage against frauds than less social crimes such as rape, murder and robbery. Besides, victims of frauds are often institutions rather than people and it is perhaps an ironic confirmation of humanity that people have less sympathy for the defrauded corporation. Another feature of fraud is that while social crimes are more or less exclusively national in context economic crimes like fraud overlap boundaries and continents. And criminal jurisdiction is, almost without exception, based on the notion of territoriality.

What I want to put forward for your consideration is the sort of strategy which should be advanced and the change of mental perspective or “mind-set” that is involved. Reality is largely a matter of habit and we need to alter our habitual approaches in the light of changed circumstances.

Increasingly we must see and regard ourselves as part of an emerging world community. A comprehensive internationalization of trade has set the stage. Where world economies in the past were the result of empires, the present world economy grew out of relatively free exchange. Today’s trading community comprises shippers, charterers, shipowners, bankers, insurers, importers and exporters and the system designed for the transfer of goods is simple and efficient.

But the sea remains the lifeblood of trade. Delivery of goods still takes time. As a matter of custom, the seller gets paid before the buyer receives the goods. The system of letters of credit evolved with banks as the intermediaries in the transaction. Documents rather than goods are the focal point of these transactions. Article 8 of the Uniform Customs and Practice for Documentary Credits issued by the International Chamber of Commerce states:

The simplicity of the system made it potentially efficient. That the system is efficient derives from the convention of trust. As long as parties to the transaction realize that trust makes the simplicity of the system practicable, all the parties derive a benefit.