This paper examines the current jurisprudence on letters of credit, focusing on the question of how the fraud exception to the autonomy principle should be characterised in the conflict of laws; and consequently, which law should apply to determine if the fraud has been established. It argues that the fraud exception has been incorrectly subsumed within a unitary conflicts characterisation of the letter of credit contractual framework, rather than being correctly characterised as a separate and independent issue. On the basis of fundamental conflict of laws principles and policies, this paper advocates that the fraud exception should be characterised separately as a tortious/delictual issue. It then discusses how some of the difficulties of such a conflicts characterisation may be adequately addressed.