Wednesday, April 01, 2009

Caveat-vendor: beware of Chinese scamsters

Put yourselves in the shoes of a producer with plenty of wine to sell. You receive an email or letter from a Chinese "Buying Center" interested in placing a test order worth $250,000 or more for one of its clients . There is no haggling over price, and an undertaking to wire payment for the wine before it leaves your winery. To make the deal, you are invited (at your own cost) to visit Guilin where the buyers are based. Once there, you are welcomed and entertained lavishly and taken on city tours. Next, comes a visit to an art gallery, where it is explained that you should honour local tradition by buying a gift for the head of the company that is actually purchasing your wine. You will carry the artwork home with you to hand over to the buyer when he visits your winery and signs the final contract. The art on show is fairly pricy, and you are warned off spending too much. Nothing more than $25-30,000. You make the purchase and head home with it, full of happy memories and pleasure at the thought of the Chinese money that is about to flow in your direction. But that, unfortunately is the end of the story. The buyer never actually appears at your door and efforts to contact him or the Buying Center are fruitless. You are left with your wine, an almot certainly heavily overpriced painting and credit card bills for an expensive trip to China.
I was told about this scam by one of its victims, Graeme Avery, owner of Sileni one of the biggest wineries in Hawkes Bay, New Zealand. Avery, a pharmaceutical scientist and former owner of medical publishing company, is no-one's idea of a sucker, but he says that he was completely taken in by the sophistication of the fraud. As, it seems, were at least two other New Zealand wineries, and almost certainly many elsewhere, as well as manufacturers of every other kind of product. Type "guilin scam" into Google and you'll find nearly 300 sites. Apparently, Guilin has developed a Lagos-like reputation for this kind of behaviour, thanks allegedly to the involvement of local authorities, but I'd be surprised if similar fraudsters were not at work elsewhere in China, not to mention other developing countries.
You have been warned...

1 comment:

  1. Robert-more to this:
    Hi Peter,

    Please see below how they work.

    Chinese Internet Scam - Buying Center & Trip To China - Guilin Youlianshiye
    Once in a while you come across some cute Internet scams, this is one I call The Visit To China, Buying Center Scam.

    This is the Chinese latest scam online and its geared towards small and medium businesses. The idea is simple. You approach a business as a Buying Center in the city of Guilin, China (apparently the new Lagos, Nigeria), and you claim to be interested in a large test order of anywhere from $250,000 to $500,000. You provide a URL and full contact information so this looks half decent. Of course the greed kicks in and you ignore some obvious signs; like the fact that the person writing you is using a Hotmail account and that the email addresses on the site are also Hotmail. The fact that this is a Chinese company buying products for thousands of dollars without even negotiating on the terms. They agree to wire the money and provide a Letter of Credit and everything. AND….here is the catch. You need to come to China to sign the big, fat contract.

    Now people that have actually gone (and many have), find that while they are there, they get the hotel arrangement and city tours all arranged by the “company” (for a commission no doubt). Also, they ask the seller to buy a gift for the CEO of the company (apparently an “old Chinese custom”) and the gift is normally $5,000-10,000. Of course the hosts are gracious and nice the whole time. Then the signing happens and the happy seller goes home and that’s it. He never hears from them again.

    I was told that this is a capital offence in China and I just hope the authorities catch these people and provide them with their just reward. I think that encouraging tourism is nice but there must be better ways.
    To the “business owners” - If something looks to good to be true - IT IS !!

    Here are some of the names and contact details these companies operate under:
    Sa Yuweixing
    Guilinyoulianshiye Co. LTD
    F 0086-773-5850161
    P +8613768744644
    Purchase center
    Second floor 48 dong Luandong district,
    No.10kongmingxi Road
    Guilin Guangxi China 541004

    Peter SS MW