Full Question
In the Global Sources conference I attended, it was mentioned that one of the criteria for safe trading is to have the red stamp/chop on all documents to make them legally binding. I have this.

My problem is that the suppliers have not sent the goods and are now asking me to increase my order from a sample quantity order to 100 units. As I was loathe to do this, they offered to refund my money. However, they later refused to do so.

I no longer wish to deal with this company. What should I do? Can you help me in any way?

Answer
In short, it's hard to know for sure without doing some research, but I am worried the seller is a scam and isn't a formal company. As we talked about at the conference, the following red flags jump out at me when looking at the proforma invoice you have with this supplier:

1. the bank account is a personal account, not a company
2. address appears to be in a residential building
3. a official chop has Chinese characters and sometimes English translation, but rarely English only as on your document.

I would suggest the following:

1. Don't let them know you suspect anything, find some excuse to delay your formal feedback until you have a chance to better understand the situation. Don't pay any more funds until you figure out the truth!
2. Get some basic due diligence (cost a few 100 USD via www.SourcingServiceCenter.com) to determine if the factory is real or not.

If it's a real company – you are in luck, you have leverage, legal recourse and a demand letter could be issued IF needed.

If it's a fake company – it is possible to engage the local police to get your money back, and if their address, name and contact # is legit, there is a chance the police could grab them before they disappear. BUT, coordinating the police requires a lot of paperwork and face-to-face coordination on the ground in China. That means you would need to come here or engage a representative. While they are very affordable and the process would be a fraction of the costs back home, as your total order value with this suppliers is not large, it may not make economic sense to put good money after bad.

BTW, if it turns out that the seller is bad, please list them on www.SupplierBlacklist.com and warn other buyers.

For your reference, here are some resources relating to your situation:

How to avoid scams when buying overseas or online

Safe Payments = Safe Sourcing

China Sourcing Seminar: Best Practices