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- Scams: How to Avoid Them
Scams: How to Avoid Them
Fraudsters and scammers exist all over the world, and China is no exception. There have been a number of instances of British and other foreign businesses being targeted by fraudulent companies and individuals operating from various locations in China. The most common scams are:
“The Contract Scam”
Fraudulent companies in China make unsolicited enquiries to foreign companies, making orders in large quantities with very beneficial financial terms. The foreign company is often then invited out to China to sign the “contract”. When they arrive, they are asked to pay for expensive “gifts” or meals for “officials”, in order to move things forward. When the foreign representative flies back home the fraudsters vanish without trace. Companies should also be alerted when they are asked to pay for any “administration”, notarisation or foreign exchange control charges.
“The Visa Invitation Scam”
A fictitious Chinese company may randomly request letters of invitation for visas from UK organisations, so their delegates can visit the UK factory/site with a view to developing business. In reality these individuals have no interest in your company or your product – they are looking for the opportunity to enter the UK. If you are approached by a Chinese company in this manner, ensure that you carry out basic due diligence checks before issuing a letter of invitation.
“The Domain Name Scam”
A foreign company receives an email from a fictitious “internet database company”, claiming a Chinese company has filed a request to register your domain name and with a fee they can block their request. Once you have parted with the cash, the scammer disappears.
Too good to be true? Once you know the basics, it is relatively easy to prevent yourself from becoming a victim of scams. If you receive an apparently very attractive order from China (or indeed, anywhere else), or see a website offering goods at unrealistically low prices, ask yourself: is this too good to be true? If it looks too good to be true it almost always is.
Don’t get on the plane, or send money, without seeking advice from UKTI and CBBC, or carrying out appropriate due diligence checks. A guidance document on various business scams is available from CBBC; please email enquiries@cbbc.org.
