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How to Protect Yourself from this China Sourcing Scam Epidemic.

We sent a TT payment to a factory in Qingdao, China and they never shipped my order, and they will not respond to me. How should I proceed? BTW, the first 2 shipments were fine, but they never shipped the 3rd order and my TT was for $4,040. Should I try to hire an attorney in that city? Any advice is greatly appreciated.

Your situation sounds very similar to that of 3 other buyers I have heard from recently. In all cases, the supplier was doing fine, then suddenly disappears without shipping the goods.  In those cases it turns out a hacker hijacked the factory’s email account and tricked the buyers to make payment to a new bank account in PRC or HK.

I’ll be happy to recommend a lawyer if the factory has done you wrong rather than the hacker, but first, I would suggest you reach out to the factory via a channel that is less likely to have been compromised like the original phone number, fax or fed ex.  If it was a hacker, the factory may be as surprised as you about this order.  Let me know how it works out.

For your reference, there are two simple ways to protect yourself as a buyer from these hackers.

ONE: Be very sure the name of the supplier is the same for the following:

1.      on your contract

2.      the bank account where you send them the money

3.      the business license of the location of production.

TWO: More important, do an inspection (yourself or a 3rd party) before final payment is made, even with regular suppliers. It only costs a few 100 bucks and very hard for a hacker to fake an inspection at the factory.  I’d be happy to recommend the inspection agents I use if you like.

I have one of the guys who got ripped of giving me the details of his case in hopes we can inform others.  In the scam he fell for, it turns out the hacker was a Brazilian in Beijing pretending to be the factory! The police got his identity from the bank, but he has left the country. The police said there are 100’s of scammers doing this, many are not Chinese! In the past, the scammers went after new buyers, now they are going after big buyers who have established relations with existing suppliers. Very clever.

Best wishes on your sourcing program.

 

Question answered by Mike Bellamy, host of “Ask the Experts” at the China Sourcing Information Center.

Mike Bellamy is an Advisory Board Member & Featured Blogger at the not-for-profit China Sourcing Information Center (www.ChinaSourcingInfo.org). He is also the author of, “The Essential Reference Guide to China Sourcing” (chinasourcinginfo.org/book) and founder of PassageMaker Sourcing Solutions (www.PSSchina.com )





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