How to verify a proof of funds letter from a buyer
By the Vanguard Verify desk · Published 2026-10-26 · Updated 2026-10-26
Short answer: to verify a proof of funds letter, confirm the issuing bank exists and contact it through details you found yourself, not those on the letter. Check that the account holder is the contracting buyer and that the letter is recent, signed and specific. Remember that a POF only shows funds at one moment. It is not a commitment to pay. In commodity deals the buyer provides POF and the seller provides proof of product (POP).
Common forms of POF
| Form | What it shows | Main limitation |
|---|---|---|
| Bank letter on letterhead | The bank states the customer holds funds or a facility | Easy to forge, and banks often decline to confirm without the customer's consent |
| Recent bank statement | Balance on a given date | Funds can move the next day |
| Bank comfort letter | The bank knows the customer and their standing | Not a guarantee. See bank comfort letter |
| SWIFT MT799 bank to bank | An authenticated free-format bank message | Not a payment undertaking. See SWIFT MT799 POF |
Steps to verify
- Match the account holder to the buyer. The name on the POF should be the legal entity that signs the SPA and issues the payment instrument. Check that entity in its official registry or through its LEI.
- Confirm the bank independently. Find the bank on its regulator's register and its BIC through your own bank. See how to verify a SWIFT BIC code.
- Contact the bank through official channels. Use the phone number or email address from the bank's own website. Never use the contacts printed on the letter. Expect that the bank may confirm only with the customer's written authorisation.
- Check the details. The letter should have a recent date, a named signatory with a title, the bank's branch address and an amount consistent with the deal. Compare the letterhead with genuine documents from the same bank if you have them.
- Prefer bank-to-bank evidence. An authenticated message received by your own bank is far stronger than a PDF.
- Move to a real payment instrument. What protects the seller is an issued documentary credit or another bank undertaking, not the POF.
Red flags
- Wording such as "clean, clear, unencumbered and of non-criminal origin". The ICC's Financial Investigation Bureau has flagged this kind of language in a forged proof of funds letter.
- Very large round sums "held in trust" for a private individual.
- The account holder is a third party or an individual, not the buyer company.
- An advance fee is requested before the POF or a "bank-to-bank" message will be sent.
- The seller is asked for POF. The seller provides POP, the buyer provides POF. See POF vs POP.
- The verification phone number on the letter goes to a mobile number or a generic switchboard that does not match the bank's website.
Privacy and fair use
Treat POF documents as confidential, share them only with people who need them, and do not pass them along a broker chain. A buyer can reasonably ask for an NCNDA and for the seller's company details before sharing a POF.
Check a company now with Vanguard Verify — first check free.
Type the company name. We show its public registry record (Global LEI Index), free.
Public registry data. By searching you accept our Terms.
FAQ
Who provides proof of funds in a commodity deal?
The buyer provides POF. The seller provides proof of product (POP).
Will a bank confirm a proof of funds letter?
Often only with the customer's written authorisation, because of banking confidentiality. Contact the bank through details on its own website.
Is a POF a guarantee of payment?
No. It shows funds at a point in time. Payment security comes from an issued instrument such as a documentary credit.
What wording in a POF is a red flag?
Phrases like 'clean, clear, unencumbered, of non-criminal origin' were flagged by the ICC Financial Investigation Bureau in a forged POF letter.
Vanguard Verify is run by Vanguard Trade Capital Goods Wholesalers DWC-LLC, Dubai South, Licence 14282. This answer is general information, not legal or financial advice.