A Malaysian scammer set up his own freight forwarder to deliver goods

A Malaysian scammer registered two companies in Hong Kong. The two companies cooperated with each other: One trading company was responsible for purchasing from Chinese exporters; the other freight forwarding company was responsible for delivering goods without B/L. The Chinese exporter suffered economic losses of more than US$ 600,000.

At the beginning of 2008, a foreign trade company in Fujian Province (“Fujian Exporter”) reached a sales agreement with a Hong Kong company. The Hong Kong company (“Hong Kong Buyer”) ordered slippers, jeans and other goods from the Fujian Exporter with a value of more than US$ 600,000. The payment term was bank collection. The Hong Kong Buyer appointed a Fujian local freight forwarder for the Fujian Exporter. The Fujian Exporter delivered the ordered goods in Fuzhou as agreed. Actually, before the shipment, the Hong Kong Buyer commissioned a Hong Kong notary firm to inspect and supervise the goods and  shipment. The Hong Kong Buyer’s boss even went to the factory in Fuzhou to check the shipment status. After the goods arrived at the port of destination in Hong Kong, the Hong Kong local freight forwarding company issued a delivery guarantee to the Chinese domestic freight forwarder, and the Chinese domestic forwarder notified the ship owner to telex release the goods to the local freight forwarder in Hong Kong .

After the local freight forwarder in Hong Kong took all the goods from the shipping company, the Hong Kong Buyer and the Hong Kong forwarder immediately disappeared. The Fujian Exporter was not able to recover the payment for the goods, nor could it recover the goods. The Fujian Exporter suffered such a heavy loss and owed a huge debt to the factory, which caused the factory to be on the verge of bankruptcy.

After investigation, both the Hong Kong Buyer and the local freight forwarder in Hong Kong were registered and established by a Malaysian Chinese. The Fujian Exporter was convinced that it had encountered international fraud and could do nothing but report to the police in many places.

Lessons and enlightenment:

1. When the payment method is D/P, it is not absolutely safe for the exporter to hold the original bill of lading, so beware of bad importers releasing the goods without the bill of lading, especially if the carrier or domestic forwarder is designated by the importer .

2. It has been repeatedly emphasized that foreign trade companies must have a sense of risk prevention and keep a clear mind when facing large orders. It is necessary to develop the habit of conducting necessary credit investigations on foreign importers. The larger the order amount, the more necessary and comprehensive credit investigations are required. If necessary, lawyers or professional institutions should be entrusted to conduct due diligence on the other party.