Buyers Beware –Double Diligence

Fraud can always accompany business; only sometimes does it actually reveal itself.  We say, double your diligence before you pay.

A couple days ago, a buyer voiced a  complaint to me.  The buyer told me that their supplier received payment for goods.  However, the supplier denied receiving the deposit and refused to deliver the goods as per the agreement. The buyer said, “I received the supplier’s email from the same address with the supplier making a  claim that their bank account was undergoing audit and asked us to make payment to an overseas bank account.  Later I found out, the supplier never changed their bank account!”

Watch out!  A typical hacking scam, within sourcing, goes like this:

First, hackers will break into trading company’s email inbox and follow communication between clients.  A supplier’s email inbox is easy access to hackers.  Hackers will then find  an opportunity to send an email to the  buyer.   Most hackers will tell buyers, ‘they are using a new bank account and all the payment made should be directed to that account.’  If the buyer does as told without receiving confirmation from the supplier, by phone, regarding any changes, large amounts of money will probably be lost.


Remember: any changes that seem out of the ordinary to you, get phone confirmation from the supplier before adhering to new changes.


Sophie Mao is Sr. Partner at AsiaBridge, a Guangzhou based law firm offering Intellectual Property Protection, Bilingual Contracts, Mediation and Litigation.  Sophie is based in Guangzhou.

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