Prevention playbook
Stop the scam before it starts
Almost every loss in the case library was preventable with one missed control. This is the full prevention routine, organized by the stage of the deal where each check matters most.
Before you engage a supplier
Most fraud is decided before the first payment. Confirm who you are actually dealing with.
Verify the legal entity on GSXT
Look up the company on China's official enterprise registry (GSXT). Confirm the registered legal name, status, registered capital and business scope — and that it actually covers steel.
Match every name exactly
The registered company name, the contract party and the bank-account beneficiary must match exactly. Any mismatch is a stop sign, not a formality.
Separate manufacturer from trader
Ask directly whether they are the mill or a trading company. A trader is not inherently bad, but you must know who actually produces the steel and verify them too.
Check independent export history
Confirm verifiable export records under the claimed name. A real exporter has a traceable shipping footprint you can cross-check.
Before you pay a deposit
Verify the factory and documents are real, and structure payment so you keep leverage.
Run a live, unscripted video tour
Insist on a real-time video walk-through of the specific production line and your material — not a recorded clip. Ask them to show today's date or a written note on camera.
Verify mill certificates at the source
Confirm heat numbers, grade and chemistry directly with the named mill, never through the trader. Request the native certificate file, not a flattened image.
Keep deposits modest and milestone-based
Avoid large upfront deposits. Tie payments to verified milestones, and for first orders prefer a letter of credit or escrow over a deposit wire.
Commission an on-site audit for large orders
For first-time or high-value orders, pay for an independent on-site factory audit. It is a fraction of the loss it prevents.
At production and container loading
Inspection only protects you if it covers the right stages with the right scope.
Appoint and pay the inspector yourself
Never accept an inspection report the seller commissioned. Engage the agency directly, define the scope and sample size, and verify the report number with the agency.
Require full container-loading supervision
Door photos are not enough — they enable the head-and-tail scam. Have the inspector photograph every layer during stuffing, with timestamps.
Reconcile weights against the packing list
Weigh a sample of coils or bundles and reconcile against theoretical and declared weights to catch short-weight loading.
Test grade-sensitive material before shipment
For structural and stainless steel, add PMI and dimensional checks on the actual lot — not just the sample — before authorizing shipment.
At the moment of payment
Payment hijacking is the single most expensive scam. These controls stop it.
Lock banking details in the contract
Fix the beneficiary account in the signed contract at the outset, and treat any later change as a hard stop until verified.
Confirm every transfer by voice
Verify payment instructions by phone on a number you established earlier — never a number from the payment email — before releasing funds.
Reject offshore and third-party accounts
Only pay an account in the contracting company's exact legal name. Treat third-country or personal beneficiaries as a hard stop.
Inspect the full sender address
Check the complete email domain, not just the display name. A single changed character is the hallmark of business email compromise.
On arrival and acceptance
The last chance to catch substitution before the steel goes into use.
Make arrival testing mandatory
Independently test grade, chemistry, dimensions and coating mass on arrival. This is the control that repeatedly prevents structural failures.
Control your own customs declaration
File your own customs paperwork with a single accurate invoice. Never let the seller under-declare value on your behalf — you carry the liability.
Document discrepancies immediately
If anything is off, photograph and record it before unloading further, and notify the supplier and inspector in writing the same day.
If you think you have already been scammed
Move fast — the first 24-72 hours are the only realistic window to freeze or recover funds.
- 1
Act within hours, not days
Contact your bank immediately to attempt a wire recall. The first 24-72 hours offer the only realistic window to freeze or claw back funds.
- 2
Preserve every piece of evidence
Keep all emails with full headers, contracts, invoices, chat logs, payment receipts, and banking details. Do not delete or edit anything.
- 3
Notify both banks in writing
File a formal fraud report with your bank and ask them to contact the beneficiary bank to flag the account and request a hold.
- 4
Report to the authorities
File with your local police or economic-crime unit and any relevant cybercrime portal. A formal report number supports any bank or insurance claim.
- 5
Warn the next buyer
Share the pattern (anonymized if needed) so others recognize it. Fraud rings reuse the same domains, accounts, and scripts repeatedly.
Turn this playbook into a scored checklist
Run your supplier through the structured verification tool.