Fraud Case Study 15--Asking for "Deal Sweeteners" Fraud

Case Description:

A company sent my company a fax asking for a price on our Marble Cremation Urns. They seemed very professional and said they would like to buy 25,000 units. A week later, they invited me to their company in to negotiate the deal. When I arrived,  they picked me up and took me to the hotel. They very quickly offered what appeared to be a very good deal. However, I felt  suspicious of the deal because it seemed too good to be true. After we finished talking, they said that according to Chinese tradition we were obliged to throw a big party to treat their superiors. This would cost several thousand dollars. We promised them that we would have the party after the contract had been signed to celebrate our first transaction. They insisted many times that we should have the party now; but we refused every time. Finally, they asked us to give them some money to buy cigarettes for their superiors. We refused again. Therefore, they left the hotel and called my translator to inform us that they would not do business with us. We were totally aware of what they had wanted from us. We went home and worked towards our next international trade experience.

Case Analysis:

1) This is an old scam, which generally happens in domestic trade markets; however, it has now spread to the international trade market. The scammer will lure you into their trap by placing an extremely large order and invite you to pay a visit to their company. This kind of deal is usually too good to be true.

2) In these cases, you will be invited to their local factory to conduct further negotiations. However, they will find an excuse to make you pay expenses, such as expensive gifts or dinner according to their “local tradition.” In reality, the scammer will receive a big reward from the restaurant when they order expensive items, such as wines or cigarettes.

3) If you encounter this situation, you should refuse their requests and get away from the as soon as possible. It is also suggested that you move to another hotel to avoid any possible threat to your property and security.

4) It is always essential to check the background information of your potential business partners. This can be done by searching the Internet or on Alibaba.com's forum. Conducting your own due diligence to avoid Internet Fraud is always important.