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Advice to Buyers to Avoid Fraud

Fraud can be found worldwide, anywhere that money is involved. Those trying to defraud others often have similar characteristics. For the foreign buyer of goods from a foreign country, a few signs which could signal a fraud include an unusually low price for the products, asking the buyer to send money to a private bank account rather than a business account, a willingness to accept very small orders, asking buyers to register for an account with a governmental authority and then asking some up-front money to buy the products or asking buyers to send a partial payment and then demanding that the buyer must make a larger order or send a larger down payment. Any of these should be considered red flags, warnings to be cautious about the provider.

Recommended actions to help avoid fraudulent deals

If possible, visit the supplier's facilities and offices before contracting with him. It is easy to be deceived by a supplier's Internet site. A personal visit helps to alleviate any doubts about his veracity.

Do extensive research into the supplier's background and the history of his company. Third-party investigators can look into the supplier's legal registration and his credit records. In some countries, such information is a part of the public record of a business.

If the price offered seems quite low, consider further investigation before sending any money to the supplier. You could also check online forums which could have information about the supplier. If there are negative comments about him, you should take care in any business dealings with him.

When you feel secure about dealing with a particular supplier, get a written contract. Be careful to not omit any details which you feel are important. Include such issues as late deliveries, damaged or defective products or any other pertinent details. Get it in writing.

One way to gain confidence in the supplier is to order samples before placing an order. Of course, if he sends any samples, they will be of his best quality. You can protect your company's investment by insisting on a pre-shipment inspection of your products.

Using an escrow service for payments makes sense if you have doubts about your supplier. The escrow service will forward the payment to the supplier only after your shipment arrives in your port of entry.

If you find you are the victim of fraudulent activity, report it. Any negative reports can help others avoid being victims in the future.

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