Introduction: When engaging in international trade, letters of credit (LCs) play a crucial role in ensuring secure and efficient transactions. However, the process of transferring the L/C can expose both the transferring bank and the parties involved to certain risks. Mishandling or errors during the transfer can lead to claims and defenses against the transferring bank. In this article, we will explore the potential risks associated with transferring banks under letters of credit and discuss effective strategies to mitigate these risks. Understanding the Risks: 1. Documentation Errors: Incorrect or incomplete documentation can result in discrepancies that may trigger claims against the transferring bank. These errors can include discrepancies in quantity, quality, pricing, or even incorrect shipping dates. 2. Non-compliance with Terms: Failure to comply with specific terms and conditions outlined in the LC can lead to disputes between parties involved. This could arise from non-c...