Sanctions Evasion Reference

Over-invoicing

Stating a price above the true value of goods on an invoice, so that the importer transfers more value to the exporter than the trade justifies.

reviewed

2026-08-20

Over-invoicing moves value out of the importing country. The buyer pays the inflated invoice through normal banking channels, the seller keeps the excess, and the payment looks like ordinary trade settlement all the way through.

It is detected by comparison rather than inspection: unit prices against market or customs reference prices, and the same goods against what the same parties paid on other occasions.

Where this term is used

  • What is hawala and how does informal value transfer work? — Settling obligations between brokers in different countries by netting them against each other, so a customer's payment reaches a recipient abroad without any funds crossing a border.
  • What is a phantom shipment? — A phantom shipment is a trade transaction that is documented, financed and paid in full when no goods, or far fewer goods, were ever shipped. The payment is the entire purpose.
  • What is trade misinvoicing? — Trade misinvoicing is misstating the price, quantity or description of goods on trade documents, so that value moves across a border in a direction and an amount the paperwork does not admit.

Related terms

  • Under-invoicing — Stating a price below the true value of goods, so that value is retained abroad or duty and export restrictions are reduced.
  • Trade misinvoicing — Deliberately misstating the price, quantity or description of goods on trade documents so that the value recorded differs from the value actually exchanged.
  • Mirror statistics — Comparing what one country reports exporting to a partner with what the partner reports importing from it, treating persistent gaps as evidence of misreporting.

Sources

  1. Trade-Based Money Laundering: Risk Indicators. Financial Action Task Force and Egmont Group, 2021.
  2. Trade Misinvoicing. Global Financial Integrity, 2024.

All glossary terms