The clearest warning signs are payment to a personal or third-party account, bank details changing mid-deal, a demand for 100% prepayment, refusal to show the factory, a price far below market and stalling on documents. Check the company in China's official registry and on site before sending money — most reliably done by someone in China who reads Chinese.
One bank transfer and the money is gone: recovering a deposit from China is almost impossible. The good news is that a scammer almost always leaves traces — in the payment method, in the documents and in the official registries. Below are 9 signs that give away a dishonest supplier before you transfer any money. No single sign is a verdict, but two or three together are a reason to stop and dig deeper. The main rule is simple: verify first, pay second. We verify suppliers in China for clients every day — below are the signs we see most often.
1. Payment to a personal or third-party account
The most dangerous signal. A legitimate factory accepts funds into a corporate account whose name matches the legal entity in the contract. A request to transfer to a personal card, the account of an "acquaintance", or a company with a different name is a classic money-siphoning scheme.
What to do: pay only into an account whose name exactly matches the company in the business license and the contract. Any discrepancy in the recipient's name — stop.
2. Sudden change of bank details mid-deal
Mid-deal an email arrives: "the finance department has changed banks, please pay to the new account." Often this is not the factory but an attacker who has intercepted the correspondence (a man-in-the-middle attack). The old details were genuine — the new ones lead to the scammer.
What to do: confirm any change of bank details through a separate channel — a video call or a call to a previously known contact, not by replying to the same email.
3. Demand for 100% upfront payment or opaque payment methods
A serious factory works on terms like 30/70 (deposit/balance). A demand to pay the full 100% in advance or to transfer via Western Union or cryptocurrency is a way to make the payment irreversible and untraceable. A structure with the balance paid after a quality check lowers the risk on its own: we covered how this works in the guide "Factory inspection in China: how it works and why before the balance payment".
What to do: stick to a structure with the balance after inspection and avoid irreversible payment channels.
4. Avoids video calls and won't show the factory
If a supplier refuses a video call or a video tour of the workshop, citing "company policy", there is probably no production at the address. Fake factories exist only online: stock photos of workshops and made-up addresses.
What to do: ask for a live video tour of the production with today's date spoken aloud. A refusal is a red flag. The most reliable option is a physical visit to the factory by a real person.
5. Price significantly below market
If the price is substantially below market with no logical explanation (volume, clearance of leftover stock), it is either a different quality or a trap. Real factories operate on thin margins, not on "miracles". A lowball price is a scammer's favourite bait, because the prospect of a bargain dulls your vigilance.
What to do: compare at least three offers for the same product. An abnormally low price with no reason is grounds for deeper verification, not for celebration.
6. Drags their feet on providing documents
A legitimate supplier provides a business license, certificates and references without any problem. Evasion, excuses or an endless "we'll send it later" on basic documents is a disqualifying signal.
What to do: request the business license (营业执照) and cross-check the name, registration number, registration date and business scope against what they claim.
7. A trader posing as a manufacturer
Many "factories" are actually trading companies. In the business license, the business scope does not include manufacturing of your product category. This is not always fraud, but an intermediary adds a markup and does not control quality on the line. We covered how to spot this in the guide "Factory or intermediary: how to tell a manufacturer from a trader".
What to do: cross-check the business scope in the license against the supplier's claims. If manufacturing of your category is not listed, ask directly whether this is a factory or a trader.
8. Certificates and test reports that can't be confirmed
Scammers send fake CE/ISO certificates or test reports. The forgery usually surfaces at customs or during marketplace verification — after you've already paid. Signs: a mismatch in the product name in the report, dead links, no number to verify against.
What to do: verify the report number and date directly with the laboratory that issued it — SGS, Intertek or TÜV. If a report is "unverifiable", treat it as invalid.
9. A bad track record in official registries
Every scheme leaves traces in official data: court cases from other buyers, the blacklist of dishonest debtors (失信被执行人), missing annual reporting, a low tax rating, declining registered capital. A scammer cannot clean this up.
What to do: check the company in China's National Enterprise Credit Information Publicity System (GSXT): status, registered capital, legal representative, business scope and any court or administrative cases.
Why overseas buyers are the main target for scammers
Scams are built for foreign buyers precisely because they can check almost nothing themselves:
- They cannot visit. A fake factory exists only in photos and video — and for a buyer thousands of kilometres away that is enough.
- They cannot read Chinese. Registries, court cases, blacklists (失信被执行人) and the company's real name are all in characters. An English profile can say anything.
- They pay blind. A foreigner does not know what a legitimate factory's bank account should look like and more readily accepts a Hong Kong or third-party company.
- They have little chance of recovery. Suing in a Chinese court from abroad is slow, expensive and uncertain.
So the most effective protection is not reading emails more carefully — it is having someone in China who checks the company in Chinese and physically visits the factory before you pay.
Quick checklist: 9 signs and what to do about them
Save this list and run through it before every new deal with a supplier from China.
- Payment to a personal / third-party account — pay only into an account in the name of the legal entity from the license.
- Change of bank details mid-deal — confirm through a separate channel (video call / phone call).
- 100% upfront payment, Western Union, crypto — use a structure with the balance after inspection.
- Avoids video and a factory visit — live video tour + physical visit by a person on site.
- Price significantly below market — compare 3+ offers for the same product.
- Drags their feet on documents — request and cross-check the business license.
- Trader posing as a factory — cross-check the business scope in the license.
- Unverifiable certificates — verify the report with the laboratory (SGS / Intertek / TÜV).
- Bad track record in registries — check GSXT: court cases, 失信, reporting.
The main rule: verify before you pay
Fraud by Chinese suppliers is almost always predictable — it reads from the payment method, the willingness to show the factory and the traces in the registries. Two or three signs together mean: stop and verify before you transfer any money.
Here is what we do before you pay:
- We check the company in Chinese — state registry, court cases, blacklists, related entities.
- We verify the bank details — the account must belong to the entity on the license and contract; any change only with confirmation.
- We send a real person to the plant — rather than trusting video.
- We control the batch before the balance — pre-shipment inspection.
- Experience, not theory. Since 2019: 3,500+ deliveries, a base of 340+ verified suppliers and over $10M in purchasing volume for clients.
Verification is part of our full cycle: factory search → verification → production oversight → quality control → logistics. Details are on our supplier verification in China page. Further reading: the pre-deposit supplier checklist and how to find and verify a factory in China.
Frequently asked questions
Can I get my money back if a Chinese supplier turns out to be a scam?
Sometimes — if the payment went through a protected channel (such as Alibaba Trade Assurance) or the bank managed to stop the transfer in time. A bank transfer to a scammer's account is almost impossible to recover, so the only real protection is checking before you pay.
Does Verified Supplier status protect against fraud?
Partly. It confirms the platform profile but does not protect against swapped bank details, off-platform payment or a batch that differs from the sample.
Which scam sign is the most dangerous?
A request to pay an account whose name does not match the entity on the license and contract — especially a sudden change of bank details mid-deal.
