Business scams to avoid

[dazdaz]

I've read about several business scams and Thailand seems to have the honour of hosting some of the worst, especially if you fall for them.

What advice would any business owners have to watch out for that have setup shop so to speak.  While most people will be extremely careful, it helps to highlight the obvious and not so obvious issues new business owners face.  I suppose the answer could create a seperate website on it's own and fill many thousands of pages.

But on a more serious note, it'd be pretty awful for a new venture to go down the pan, after a fraudster spots a fresh farang director in fresh territory.

New tactics and skills are obviously required to adapt to a new business environment, potential abuse, adapting to an Asian economy(cultural changes in business), these are just reality's.

I wonder if this puts off many potential business ventures because of the level of crime as more time needs to be invested learning and taking precautions over potential fraud and security issues.  What level of insurance is available.

I'd like to think i'm a little over concerned and just being sensible, however from some of the stories i've read on the net, it would appear not.

There does seem to be a market niche here for lack of pure business information.

Thanks

[caughtintheact]

Howdy dazdaz,

You are right.  Falling prey to a scam can ruin your entire day.  

Here are a few tips that might help (as you say, it would take many pages to cover everything):

1.  Due Diligence:  Check out the people you are dealing with before you put up any money for anything. If anything looks or sounds suspicious, chances are that it is not worth taking any risk.

2.  Set up internal controls such as using both internal accountants and an external auditor.

3.  Believe what you see, not what you are told.

4.  Understand that there are no words in Thai that mean specifically "yes" or "no".  Avoid asking questions that would usually require a Yes or No reply, phrase your questions so that a full explanation is required in reply.

5.  Heed the axiom:  If it's too good to be true, it is"

6.  Encourage and Enforce feedback.  In most Thai/Chinese organizations, the employer is required to go look for problems, as the employees cannot bring problems to the boss.  That would imply that the boss made mistakes (and all Thai know that the boss is infallible).

7.  Provide good training.

8.  Take good care of your employees.

9.  Listen to what your people are saying, but always followup.  

10.  Only crooks get rich overnight unless you inherit a fortune. Hard work, not schemes or talk, is what gets results.

11.  Never believe what you hear in a bar (at least not until you do some due diligence on it)

12.  Believe in results, not talk (but you still need to develop a good rapport with your employees).

13.  Don't throw away money like it's going out of style, because rainy days are always ahead. (This means don't show off by spending more than you can afford, unless you consider it necessary to take a risk).

14.  Be honest - with yourself and with your employees, but don't expect honesty from others.  

15.  Be a bit paranoid - trust takes a long time to build.  

16.  Due due diligence - I can't overemphasize this.  The tools are available.  People and business deals can be checked out on the web and through various other sources.

17.  If a Nigerian calls you, hang up.

18.  If you get a cold call regarding investment, hang up.

19.  If anyone asks for up front money on a deal to make a huge return, hang up or walk away.

(For 17-19, you also might want to contact the local authorities of your country to see if they have any more information)

20.  Do your Due diligence, what else?

Hope this helps.  

Cheers/Caught

[SamuiJens]

No 1 to watch out for is, yes you guessed it, TIMESHARE!

[SnakeBite]

I thiught this: " Offshorecash" was a funny ad to this thread.

[Sunbelt Asia]

Had a case today.

A friend introduce this German couple to a lawyer. They had visited Thailand and fell in love with the country. Bought a house and was told they could not put it in their name. The lawyer introduce them to his "friend called Noi." They wired the money to Noi's account and she bought the house. The lawyer then states "we need to form a company to transfer the house into the company." He wants 180K to form the company. They get suspicious as they felt this was too much to form a company. The couples friend refuses to negotiate.

The German couple asked to see the title deed of the house bought by the friend of the lawyer "Noi", who then stated she “lost it” as well the excuse “ I never got it in the first place at the Land Dept.”

We are approached at this stage and stated Noi to file a police report on the lost chanote and reco for Noi to do a long term lease for the couple. Noi refuses to do a long term lease as it is "her house and land", in her name. It was a gift from them!

They now are in Germany wondering want they did wrong?

www.sunbeltasiagroup.com

[GuestHouse]

Always get a second professional opinion, preferably from a law firm, business broker in another town.

Doing business with long established names helps too.

I'm currently doing some legal checks and I'm using a well established law firm to do those checks, I was dithering over getting the extra checks done and then it dawned on me exactly how much is at stake and how little the extra checks where costing.

Honestly, you can buy the services of fist rate and long established law firms and business brokers in Thailand at very reasonable prices and fees.

I'm quite certain Sunbelt, or anyone doing business in Thailand between Thais and Farangs will tell you, they get a second sense at smelling rats.

Rats in anycase will useully try to avoid you the buyer going anywhere near a reputable law firm or business broker.

Stick with the names people recommend and who have been around long enough to demonstrate their trustworthiness.

[rocky]

Had a case today.

A friend introduce this German couple to a lawyer. They had visited Thailand and fell in love with the country. Bought a house and was told they could not put it in their name. The lawyer introduce them to his "friend called Noi." They wired the money to Noi's account and she bought the house. The lawyer then states "we need to form a company to transfer the house into the company." He wants 180K to form the company. They get suspicious as they felt this was too much to form a company. The couples friend refuses to negotiate.

The German couple asked to see the title deed of the house bought by the friend of the lawyer "Noi", who then stated she “lost it” as well the excuse “ I never got it in the first place at the Land Dept.”

We are approached at this stage and stated Noi to file a police report on the lost chanote and reco for Noi to do a long term lease for the couple. Noi refuses to do a long term lease as it is "her house and land", in her name. It was a gift from them!

They now are in Germany wondering want they did wrong?

www.sunbeltasiagroup.com

Is there nothing that can be done ? The german couple made a big big mistake, but surely it dosent end here?

Anyway what a shame for the couple, there dreams shattered.....

[teej]

Had a case today.

A friend introduce this German couple to a lawyer. They had visited Thailand and fell in love with the country. Bought a house and was told they could not put it in their name. The lawyer introduce them to his "friend called Noi." They wired the money to Noi's account and she bought the house. The lawyer then states "we need to form a company to transfer the house into the company." He wants 180K to form the company. They get suspicious as they felt this was too much to form a company. The couples friend refuses to negotiate.

The German couple asked to see the title deed of the house bought by the friend of the lawyer "Noi", who then stated she “lost it” as well the excuse “ I never got it in the first place at the Land Dept.”

We are approached at this stage and stated Noi to file a police report on the lost chanote and reco for Noi to do a long term lease for the couple. Noi refuses to do a long term lease as it is "her house and land", in her name. It was a gift from them!

They now are in Germany wondering want they did wrong?

www.sunbeltasiagroup.com

omg... that's horrible... poor couple...

[gabe]

Had a case today.

A friend introduce this German couple to a lawyer. They had visited Thailand and fell in love with the country. Bought a house and was told they could not put it in their name. The lawyer introduce them to his "friend called Noi." They wired the money to Noi's account and she bought the house. The lawyer then states "we need to form a company to transfer the house into the company." He wants 180K to form the company. They get suspicious as they felt this was too much to form a company. The couples friend refuses to negotiate.

The German couple asked to see the title deed of the house bought by the friend of the lawyer "Noi", who then stated she “lost it” as well the excuse “ I never got it in the first place at the Land Dept.”

We are approached at this stage and stated Noi to file a police report on the lost chanote and reco for Noi to do a long term lease for the couple. Noi refuses to do a long term lease as it is "her house and land", in her name. It was a gift from them!

They now are in Germany wondering want they did wrong?

www.sunbeltasiagroup.com

now that is frickin' screwed up!

[eljeque]

Had a case today.

A friend introduce this German couple to a lawyer. They had visited Thailand and fell in love with the country. Bought a house and was told they could not put it in their name. The lawyer introduce them to his "friend called Noi." They wired the money to Noi's account and she bought the house. The lawyer then states "we need to form a company to transfer the house into the company." He wants 180K to form the company. They get suspicious as they felt this was too much to form a company. The couples friend refuses to negotiate.

THEY SHOULD BE GOING AFTER THIS "FRIEND"

DIDN'T THEY HAVE ANY DOCUMENTS OR AN AGREEMENT OR ANYTHING?

The German couple asked to see the title deed of the house bought by the friend of the lawyer "Noi", who then stated she “lost it” as well the excuse “ I never got it in the first place at the Land Dept.”

We are approached at this stage and stated Noi to file a police report on the lost chanote and reco for Noi to do a long term lease for the couple. Noi refuses to do a long term lease as it is "her house and land", in her name. It was a gift from them!

They now are in Germany wondering want they did wrong?

www.sunbeltasiagroup.com

[Cyberstar]

Business scams to avoid? -

Brick-and-stone businesses, put on sale because the busineness owner has been told by his landlord to move out within three months because the landlord wants to sell the property ... I,ve seen two guyes loosing out on this in my immediate neighbour-hood within the last year. One guy even bought his business throught the real-estate branch of a very well-known, highly respected, and highly (most often well-deserved) recommended lawyer/real-estate franchise we all know ...

From that example, I've learned: Obviously, you can't rely on even (doubtless: honest and professional) agents to do all that's required to do due diligence! (Assuming the agent didn't knowingly help fooling the buyer).

Edited October 31, 2006 by Cyberstar

[Firefan]

Cyberstar; it is not the job of the biz broker to do the due diligence. When one signs up with E.g. Sunbelt one has to sign something along those lines MULTIPLE times.

That said you have a good point - and a check with the land lord/lease would make very good sense.

Other "scams"(not really) are simply all the "dreamers" out there that truely BELIEVE they have a great biz oppurtunity - buying a bar in Pattaya based on 1 visit as tourist in high season comes to mind..

Cheers!

[myfriendu]

take care of timeshare,there are some bad people out there,and brainless danes

Edited October 31, 2006 by myfriendu

[Jimbo551]

<font color='#000000'>Howdy dazdaz,

You are right.  Falling prey to a scam can ruin your entire day.  

Here are a few tips that might help (as you say, it would take many pages to cover everything):

1.  Due Diligence:  Check out the people you are dealing with before you put up any money for anything. If anything looks or sounds suspicious, chances are that it is not worth taking any risk.

2.  Set up internal controls such as using both internal accountants and an external auditor.

.............................................

20.  Do your Due diligence, what else?

</font>

All I can add to that is control the money. Do not let anyone else have signatures on your bank account and watch the Petty Cash.

[Thaipwriter]

Had a case today.

A friend introduce this German couple to a lawyer. They had visited Thailand and fell in love with the country. Bought a house and was told they could not put it in their name. The lawyer introduce them to his "friend called Noi." They wired the money to Noi's account and she bought the house. The lawyer then states "we need to form a company to transfer the house into the company." He wants 180K to form the company. They get suspicious as they felt this was too much to form a company. The couples friend refuses to negotiate.

The German couple asked to see the title deed of the house bought by the friend of the lawyer "Noi", who then stated she “lost it” as well the excuse “ I never got it in the first place at the Land Dept.”

We are approached at this stage and stated Noi to file a police report on the lost chanote and reco for Noi to do a long term lease for the couple. Noi refuses to do a long term lease as it is "her house and land", in her name. It was a gift from them!

They now are in Germany wondering want they did wrong?

www.sunbeltasiagroup.com

LOL Tought sh1t

There are loads of dummies like this arriving every day.

The are plenty of highly visible companies like Sunbelt who prevent this kind of thing happening daily.

No sympathy for them at all.

If your stupid enough to transfer money to a person you never met then you dont deserve to hang onto the money.

There is zero legal recourse here against saying it is a gift.

Thailand loves idiots like this, it perpetuates the myth that farangs have more money than sense.

[Cyberstar]

Business scams to avoid? -

Brick-and-stone businesses, put on sale because the busineness owner has been told by his landlord to move out within three months because the landlord wants to sell the property ... I,ve seen two guyes loosing out on this in my immediate neighbour-hood within the last year. One guy even bought his business throught the real-estate branch of a very well-known, highly respected, and highly (most often well-deserved) recommended lawyer/real-estate franchise we all know ...

Have had a PM-exchange with the franchise, mentioned here and learned that things weren't excactly as I thought.

I knew the seller and had referred him to Sunbelt. Since I later saw the business listed on Sunbelts website, I incorrectly thought Sunbelt was involved in the sale. However, it was a non-exclusive listing - the buyer contacted the seller directly and - as far as they know - Sunbelt has never even seen the buyer ...

So, Sunbelt didn't have even the slightest chance to help the buyer avoid his back luck... If the buyer had made the purchase through them, Sunbelt would have secured him a brandnew lease - or rather (in this case) they would have discovered the problems regarding a new lease.

Less than three months after his purchase (a restaurant with asking price 850,000 Baht), the buyer was standing on the street with nothing but used furnitures and equipment worth maybe 150 - 200K. The new landlord wanted to use the premises for a restaurant of his own.

[JimsKnight]

I'd say avoid any investment that requires cash up front, and if they are falang, watch out! A lot of conmen are now falang who try and play the 'We're falang we need to stick together' bllsht.

The only real way to try and make it is to go at it alone via online trading/business etc. All the rest have a lurking factor of risk.

[fxm88]

I recently saw a classified ad in the Bangkok Post looking for "Mystery Shoppers". Beware.

http://www.consumeraffairs.com/news04/2006...y_shoppers.html

http://www.ftc.gov/bcp/conline/pubs/alerts/mysteryalrt.htm

http://www.snopes.com/fraud/employment/shopper.asp

http://phoenix.about.com/od/scam1/a/mysteryshop.htm

[Tolley]

Had a case today.

A friend introduce this German couple to a lawyer. They had visited Thailand and fell in love with the country. Bought a house and was told they could not put it in their name. The lawyer introduce them to his "friend called Noi." They wired the money to Noi's account and she bought the house. The lawyer then states "we need to form a company to transfer the house into the company." He wants 180K to form the company. They get suspicious as they felt this was too much to form a company. The couples friend refuses to negotiate.

The German couple asked to see the title deed of the house bought by the friend of the lawyer "Noi", who then stated she “lost it” as well the excuse “ I never got it in the first place at the Land Dept.”

We are approached at this stage and stated Noi to file a police report on the lost chanote and reco for Noi to do a long term lease for the couple. Noi refuses to do a long term lease as it is "her house and land", in her name. It was a gift from them!

They now are in Germany wondering want they did wrong?

www.sunbeltasiagroup.com

LOL Tought sh1t

There are loads of dummies like this arriving every day.

The are plenty of highly visible companies like Sunbelt who prevent this kind of thing happening daily.

No sympathy for them at all.

If your stupid enough to transfer money to a person you never met then you dont deserve to hang onto the money.

There is zero legal recourse here against saying it is a gift.

Thailand loves idiots like this, it perpetuates the myth that farangs have more money than sense.

The voice of compassion.

All business to some extent relies on trust.

Scams like this are a disgrace and are a reflection of the ethics of the perpertrators.

Many westerners come from countries where business dealings like this are straight forward enough and never realise the scams that are going on in third world countries like Thailand.

I think the Germans were naive but certainly deserve our compassion.

[JimsKnight]

The most imaginative yet treacherous one I've heard was the bond scam

A bogus South African company put out an advert for UK tradesmen for work on the Gas Platforms off Southern Thailand.

The Tradesmen who applied, where sent out legit flight tickets, legit hotel bookings etc. The only catch, each tradesmen who applied was obliged to pay a 'bond' of about 10,000 pounds Sterling up front to this company in which operated in S.A.

The reason given by the bogus company was it was a 'Good Behaviour Bond' that would be refunded on completion of the work contract. The boys who paid up the bond arrived in Bangkok, checked into hotels already paid for bu the 'company'. Next few days pass while the boys are having a whale of a time partying etc. S.A bogus company calls them and lets them know the work is good to go they just need another week to sort out transportation, helicopter travel etc phoney excuse this, phony that. More workers arrive who've paid this 'bond' and so on. After aboutthree weeks about thirty workers had shown up. And there they stayed until the bitter realisation dawned on them they'd been conned. The company was now incommunicardo and had flown into the night.

The UK authorities could do next to nothing as nothing had been signed / out of their jurisdiction, not and interpol matter etc etc.

Be wary of any firm requiring money up front.

[Tolley]

JK

Good story there is a recent one that happened in Oz.

There was an ad for airline staff...stewards hosties etc.

A whole bunch of people were shortlisted and then told they had to send money to pay for clothing etc.

End result no job but lots of people out of pocket.

Shameful preying on the vulnerability of the unemployed or those seeking to better themselves.