Although the letter of credit is essentially an international instrument with an age-old pedigree, a troubling number of serious disputes still founder on national provisions with respect to the fraud rule (or fraud exception). The rule is embodied in several major international agreements, but its adjudication takes place under national statutes in which - in the opinion of Judge Xiang Gao of the Supreme People's Court of the People's Republic of China (PRC) - a significant degree of further refinement and harmonization is called for. Dr. Gao finds the best provisions and practices in respect of the fraud rule in the United States, the United Kingdom, Canada, and Australia, and applies these standards to the reformulation of the fraud rule in the PRC. In the process he surveys the entire field of the fraud rule in the law of letters of credit in its substantive aspects, thus going deeper than mere banking law analyses.