During this COVID-19 pandemic, many people may look to start an online business from home and order their goods online from suppliers, mostly from overseas. This may potentially put them at risk of being scammed, especially if they do not have prior business dealings with the suppliers.
In February 2020, an online seller had made payments of about $122,000 to two overseas suppliers to procure surgical face masks for her online business. While waiting to receive the supplies, the seller listed the masks for sale on an online shopping platform and collected payments of about $189,000 from at least 600 buyers. However, the overseas suppliers did not deliver the surgical face masks and the seller was unable to fulfil the orders from her buyers. More than 100 police reports were lodged against the seller and she was subjected to police investigations.
The Police would like to advise businesses and anyone who is planning to start an online business during this circuit breaker period to take the following precautions:
a) Only deal with reputable suppliers - Ensure that you conduct your due diligence and proper market research before committing to any purchases. Check for suppliers’ feedback and ratings to assess their reputation and credibility in the market. Legitimate suppliers are often verified by multiple inspection companies. You are encouraged to use sites such as www.supplierblacklist.com that provide reviews and warnings for dubious suppliers.
b) Verify – Ask questions regarding the suppliers’ business, such as their company standards, products, facilities, or photos. Be wary of offers that are too good to be true. You may also request for samples to check for faults and defects. Compare across multiple suppliers and ensure that all your questions are answered in a satisfactory manner before proceeding to deal.
c) Use secure payment methods – Whenever possible, use payment options on platforms that only release payment to the seller upon delivery and avoid making advance payments or direct bank transfers to the seller.
Lastly, you are advised to only accept payments from your customers when you have physically received the goods from your suppliers. The Police would also like to warn you that you may be liable to a cheating offence if you are unable to fulfil the orders.
SINGAPORE POLICE FORCE
17 April 2020 @ 9:10 AM