With any online marketplace, especially such a diverse and large market, there is going to be fraud that occurs. Furthermore, people will try to sell you scam items; whether they are fake, are sold through third party vendors or have other defects, you have to know what to look out for to ensure you do not run into such issues. It is important to take the right steps to avoid scams and fraud, and it is important to know what exists out there so as to ensure you do not run in to any issues when you are selling through Tmall.

Scam #1 – Directory Scams

This is where the scammer calls the company and tells them they are updating company records, or may tell companies they work for a larger company and need certain information. Scammers will then add the company to their online directories and will bill the company for this service. It is important to make sure you are dealing with legitimate companies, are in the valid directories and fully understand what you are paying for and who you are speaking to when making any business transaction. Due to the fact that many people try this, make sure to inquire and understand what is being asked of you and do your research to avoid this problem.

Scam #2 – Over-Payment Scams

This is a tactic used by scam artists in which they will send a check or money order and will ask the merchant to wire them the funds which were overpaid in return, back to a third party. This is very common not only with sites like Tmall, but other online sites such as eBay where the company will receive more than the actual value and will later request the funds to be returned to them.

The buyer will actually offer to pay more money than the value of the item which you are selling. When the transaction is taking place, a cashier check will be sent to you and has no monetary value tied to it. Or, the buyer will send a fake payment account and by the time you ship the item out, it is too late. What this does is it forces you to send the item prior to being paid, and you will never see the funds.
With Alipay, this is not as often an issue as it is with sites like eBay. But, there are people on the site who may request for you to send the item and insist on this payment method. Again, if something seems too good to be true, then it likely is, and you are going to send out an item and will never see the payment for the product which you have sent to the customer.

Scam #3 – “Too Good to Be True”

If the price seems too good to be true, more often than not it is. If you are a merchant and are buying from an agent, if prices seem far lower than competitors or if it seems the price can’t be right, then it probably is something you want to stay away from. Not only is the product likely to be a fraud product, but the individual who is claiming to sell to you at such a low rate is obviously going to keep the funds and will use them for other items. This is a common way for scam artists to make money and send merchants items that are cheap or items which are sold through third party companies, rather than the actual name brand item the customer wants to buy.

Scam #4 – Finish the Transaction Elsewhere

Another common tactic which is used by scammers is to ask the seller to complete the transaction through another site. What they will do is bid or confirm to purchase the item you are selling through Tmall. From there, they will offer you a price which may be higher than what you are asking for in the transaction. They will tell you they sent out the payment, and request you send the item. Once you do, these individuals will claim the product is defective, claim it is not well made or that it is a fraud. From there, the buyer will tell you that they will contact Tmall if you do not resolve the issue.

The end result of this type of fraud is that you lose the merchandise, you refund the buyer and they receive a free item. So, if a buyer asks you to complete the transaction elsewhere, it is best for you to avoid this type of transaction. Not only will you lose merchandise, you will also end up eating the cost to avoid issues with your account. Furthermore, there are millions of potential buyers; if one insists on doing the transaction elsewhere, they are likely not a real buyer and are simply trying to get free merchandise from you, so do not interact with this type of client if you do not want to lose out on merchandise, and lose your profits.

Scam #5 – The Bait and Switch

How this type of scam works is that the buyer will go through the transaction normally; they will purchase the merchandise from you and will pay. The transaction goes as it should go, and you receive payment. But, this type of buyer will have purchased a defective product elsewhere prior to having bought the item through your site. From there, they will wait until your product arrives and will claim that the defective item they ordered is the one that was sent by your company.

So, they basically pay a low price through another merchant, receive an item that is defective, and claim it was sent by your company. From there, they state they will report your business if you do not refund them or if you do not send them another item. More often than not, this is the type of fraud or scam you can’t really stop from happening. In many cases, it is hard to prove the item was as described, if a buyer is this dishonest and does this in order to receive the free merchandise.

In these cases, you are best taking your losses, sending out another item and giving them free merchandise. If you go through litigation or if you continue to go back and forth, it may result in negative feedback and issues with your account. You won’t run into many of these types of buyers, so you simply have to deal with it if it happens, and it is best to simply eat the loss and move forward with your business.

How Do You Avoid Fraud?

Honestly, there is no way to avoid fraud and scams 100% of the time. Some buyers are dishonest, and there are people who want to get things for free. There is always someone who is going to try to do wrong in order to get the item they want for free, or for as low a price as possible. So, you have to deal with this as a business owner and you have to accept the fact that there are some things you simply won’t be able to avoid when you choose to run this type of business model.

What Can You Do to Minimize It?

Simply put: if a buyer insists on doing business through another site, don’t do it. You run the risk of the fraud occurring. Sure, some people will get angry and you may lose some customers; but, you also avoid the headaches, you avoid the fraud and you do not have to worry about continually losing merchandise.

Make sure your buyers are verified. Just like you have to go through a process to become a seller, a buyer has to be verified. Check their feedback, make sure they are honest, they pay in a timely fashion and that they do not have a long standing history of always returning items. You want to stay away from these buyers, as they are going to try and get something for free. It is best to deal with honest buyers and to know exactly who you are dealing with, so as to avoid the potential for fraud and to avoid the possibility of a big loss when you are doing business on the site.

You also want to check in with Tmall often. You can visit the terms of service page, you can find out information about the most common types of fraud and you can learn how to prevent these issues. There is quite a bit of information out there for merchants; you simply have to go out there and look for it. The more informed you are and the more you know, the easier it is going to be for you to avoid it and to avoid the big losses along the way as well.

Lastly, you want to report it. If you are a victim of fraud, if a buyer tries to scam you or if issues continually turn up, then you should report them. Sure, you may lose out on one sale or you may find you are losing on the profits of a few sales. But, you prevent future fraud and you also help others in the marketplace avoid this type of fraud from happening to them. So, you will help eliminate those who are taking advantage of the system, and you will find it much easier to work in the honest open marketplace when there are fewer phishers and scam artists out there.

One of the most important things to remember is that if something seems too good to be true, then it probably is. If an agent seems to offer something that no other agent offers, you have to do your research. If a buyer continually asks to move to outside markets, you should really be mindful. If they offer to overpay, is this something that most people really do in real life? The answer is no, so why would they do it online?

If you are a smart business person, if you know what is out there and if you do your due diligence and research, you will avoid fraud, avoid big losses and won’t fall victim to fraud often when you are selling through the market and want to do well as a merchant on the site.