The Most Common Red Flags in Commodity Offers 2025 

In 2025, the global commodities market remains one of the most active and one of the riskiest, sectors to operate in. Genuine opportunities exist, but so does a flood of fraudulent offers that waste time, drain resources, and erode trust. Buyers, sellers, and mandates alike must be able to distinguish credible deals from fabricated ones.

Share

September 11, 2025

This guide highlights the 6 most common red flags to watch for in today’s market, offering practical insights for those navigating high-value petroleum, metals, and agricultural transactions.

01. Unrealistic Prices

If the price looks too good to be true, it almost always is. Fraudulent offers often undercut market value by $5–10 per barrel in oil or by 5–8% in gold trades — margins that are impossible for real refineries or title holders to sustain.



02. Fake SCOs and Circulated FCOs

Scammers frequently copy and recycle Soft Corporate Offers (SCOs) and Full Corporate Offers (FCOs) without any connection to the actual product or refinery. These documents may look official but often contain:


  • Outdated letterheads.
  • Misused refinery names.
  • No verifiable contact details.


03. Requests for Upfront Deposits

One of the clearest red flags in 2025 is any demand for advance cash payments disguised as:


  • Tank storage extension fees.
  • Documentation charges.
  • “Guarantee deposits.”


Legitimate transactions under Incoterms 2020 never require upfront cash deposits before Partial Proof of Product (PPOP) and a financial instrument.



04. Unverified Refineries or Allocations

Fraudulent offers often claim allocations from well-known refineries. On closer inspection, the seller has no official link. Always demand:


  • Trade licence and registration.
  • Refinery allocation letters.
  • Verification of mandate authority.


05. Overly Complex Broker Chains

In many fraudulent cases, offers pass through 5–10 layers of brokers before reaching a supposed seller. Each layer introduces confusion and reduces credibility. Real mandates and brokers maintain a direct link to the title holder or refinery.



06. Manipulated PPOP Documents

Partial Proof of Product (PPOP) is a cornerstone of legitimate trading. Fraudsters may produce forged or incomplete documentation, often missing:


  • Seller identity.
  • Refinery seals.
  • Clear connection to allocation.


Why This Matters for Buyers

Falling for fraudulent offers can result in:

  • Losses in the millions from deposits or false transactions.
  • Damaged banking relationships if funds are tied to scams.
  • Delays of months in securing real supply, harming contracts and client trust.

Why This Matters for Sellers & Mandates


Fraud hurts genuine suppliers too:

  • Legitimate sellers get lost in a market saturated by fakes.
  • Mandates risk their reputation if their names are misused.
  • Credible deals are missed amid the noise.


$800bn–$2tn

 According to UNODC, 2–5% of global GDP ($800bn–$2tn) is laundered annually through trade mispricing — much of it in commodities.

2024–25

Industry estimates suggest over 60% of unsolicited petroleum offers circulating online in 2024–25 showed at least one fraud marker (fake SCO, unverifiable seller, or demand for deposits).

30–40%

Buyers who work with licensed brokers report a 30–40% higher completion rate than those engaging unverified intermediaries.

Staying Vigilant: Key Red Flags in 2025

  • Unverifiable refineries or allocations.
  • Unrealistic payment terms.
  • Demands for deposits or fiduciary accounts.
  • Long broker chains with no direct seller link.
  • Incomplete or manipulated PPOP documentation.


Building a Safer Market Together


Fraud will always target high-demand sectors. The responsibility lies with all market participants to:

  • Conduct thorough due diligence.
  • Verify company registrations, licences, and mandates.
  • Engage only with licensed brokers and consultants who follow compliance procedures.


At Auctora Trade Group, we emphasise verification, Incoterms 2020 compliance, and structured transactions that protect both buyers and sellers. Your choice of partner is as critical as your choice of product.

Conclusion

Fraudulent offers are more than an inconvenience, they actively damage trust and efficiency in the commodities sector. By recognising red flags, asking the right questions, and partnering with credible intermediaries, buyers and sellers can safeguard their interests and build long-term, reliable relationships in 2025 and beyond.