How To Detect and Avoid Business Scammer

I have met several business associates whom I met through online and from some business contact that has experienced been scammed by unethical businessman a cheater or a scammer.

Based on my experienced, I noticed that commodity products such as Palm Oil, A4 Paper and Latex Gloves are some popular goods that scammer advertise through online and look for potential victims to be scam or cheat.

CASE 1

A friend contact in Morocco whom bought A4 Paper through ONLINE platform and does full payment using T.T/ telegraphic bank transfer and later got the fake shipment Bill of Lading and yet goods never arrived to destination port after 3 months of waiting.

The supplier disappeared after receiving the final payment. He been cheated and scammed.

CASE 2

A business associates in India, bought Palm Oil through FAKE company website and does a T.T Bank transfer of full payment of USD 20,000 as supplier requested prior to shipment. Supplier provided fake documentation of Invoices with FAKE company stamps.

After 2 months the supplier cannot be contacted after all payment made to supplier.

case 3

A buyer from Somalia whom bought Palm Oil through company website and does full payment of 10 x 20’ containers of Palm oil and only received 2 x 20’ containers and the balance never arrived.

He asked for refund and the supplier promises to send goods till 6 months waited and goods never arrived as the company has shut down and the supplier who is a foreigner has move to his home country.

Hearing these stories scares many of us, right…

With the new technology, sourcing for supplier, negotiate and the made payment all can be done online within minutes.

Many unethical businessman and scammer take advantage of technology to cheat buyers from all over the world to gain a lot of money through this channel.

As for me, lesson learned.

Hearing problems from our business associates whom asking for assistance to settle the issues has teaches me to be more careful when we want to source the product online.

If we as a buyer are not careful, we can easily fall trap into this situation of being corned/cheated by scammer.

Be Patient, No Rush, Be Smart & Do Research !

This will definitely MINIMIZED the RISK of being SCAM.

Let me share with you

STEP by STEP

TIPS

HOW TO DETECT & AVOID BUSINESS SCAMMER?

STEP 1
SOURCING OF SUPPLIER – Can be source from online, recommendation, exhibition etc..

No matter where the sources are, we can do some groundwork and research on the company background as below:

1. Refer to the embassy based on the Product Country of Origin

2. Check with Business Association, if any

3. Refer to buyer embassy located where the goods originated.

4. Check with Ministry of Trade or its subsidiary where the goods is originated

STEP 2
SUPPLIER CHECKLIST – Several questions to be ask such as

1. Company Business License

2. Company Registration Number

3. Company Address and Location

4. Company Profile

5. Ask for BUSINESS NAME CARD of person in charged or MD of company

6. Company Major Customer and its country

7. Company Annual Returns – Latest

8. Company Business Transaction evidence – supplier can erase the value of goods or any confidential matters.

9. Ask for Main Office Contact details and other colleagues

10. 3rd Party Audit company –recent in-house audit done by 3rd party audit or customer arrangement of audit.

Note: This is very important evidence to show that the company is exist and still running because you can take these document and write in to the Audit Company for verification.

STEP 3
• Ask for full specification of products in details in the company letterhead
Note: You may google if you not familiar or first time buyer for comparison

• Prior to visit or audit, ask supplier for video of production of goods.

• Do a Factory Audit and visit to Company Head Office for purchases of high value items.

Note: Please take effort to have a visit as SEEING IS BELIEVING! Trust Nobody.

STEP 4
• Check on BANK DETAILS
1. Bank name – Refer to your own country bank if this is a Top 500 banks.

2. Recipient Account Details – The recipient need to be under registered Company Name NOT Personal Individual Name.

3. Refer to your own country bank if the transaction using Letter or Credit. Your bank will verify if the supplier is genuine.

STEP 5
• Check with the local government subsidiaries / association / board for the company cross checking on the company existence and reliability.

You may check with embassy of the product origin or your embassy where the product is.
This apply if you buy commodity goods from the country of origin.

STEP 6
LOGISTICS
1. If possible look for your own freight forwarder and do the logistic arrangement.

2. If you do not have experience of shipment, then ask for evidence of any latest Bill of Lading for the suppliers and then counter check with the shipping company on the genuine document of the Bill of Lading.

MAIN TRICKS OF SCAMMERS

1. Copy / Fake Company Name
2. Copy / Fake Company Stamps / Chop
3. Copy / Fake of Company Logo- very similar look of logo design
4. Copy / Fake of Bill of Lading with amendment made on the date, you may see the font differences.
5. Name of bank recipient is under INDIVIDUAL NAME
6. Supplier talk so much over the phone than via email as NO PROOF OF EVIDENCE.
7. Email address using yahoo or gmail.
8. Supplier give fake identity and contact details.

9. Foreigner set up company in any country.

All these tips and steps taken is to ensure that you can confirm that the supplier is genuine and reliable prior making any purchases and payment transfer. I follow all these steps and making a checklist prior communicating with any suppliers. This can avoid big damage to our company financially.

I hope that these tips will give you some ideas on How To DETECT Business scammers/cheaters.