Monday, January 17, 2011

Investigators Say High Fraud and Scam Risk in China

China is booming in just about everything these days. Overpopulation, economy and... scams and fraud. Private investigators with operations in Beijing and Hong Kong warn that scam and fraud is up sharply compared to just two years ago, and new investments or business relationships in China should be analyzed and reviewed carefully. International due diligence is strongly advised for new business relationships in China. Investigators say fraud can come in any form, such as a person claiming to be new supplier or vendor, to claimed consultant agencies and investments. China's growth has attracted a great influx of capital and investments, and businesses and individuals are too often investing without doing their homework.

According to one Hong Kong private investigation firm, investment scams are a rising problem, but investigators are also seeing new types of scam cases which were previously not seen in China and Hong Kong. Romance scams and online dating scams are now operating from China, and although they are still at relatively low levels, private investigators say action is needed from Chinese and Hong Kong government agencies to prevent the problem from growing. International private investigators also report increased demand for China background checks and China due diligence in response to the growing risk for fraud and scam cases. Contacts via the internet are especially at high risk.

The communist government continues to work to control and influence the country's internet usage, but the government's hold on its people is beginning to loosen. With this new freedom comes new opportunities, both for honest citizens and criminals working from China. Investment fraud, romance scams, and advance fee fraud are all on the rise. In some cases, criminal operations from countries as far away as Nigeria and the U.K. are using Chinese banks to smuggle funds. Businesses and individuals should be skeptical and verify any new relationships via an international background check or due diligence investigation.

Best of luck,

A. Hathaway
© 2011 A. Hathaway
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