Danwei ran a story, University Diploma Scandal in Jinan [link no longer exists], on a fake Chinese university. This story is directly relevant for those doing business in China. Let me explain.
The story is from the Jinan Times. Jinan is the capital of Shandong Province. I have been there a couple of times and it is no backwater. The story is about how 68 students came to realize “on the eve of their graduation” that the school they had been attending for the last four years was a complete fake. These 68 students had test scores too low to get into the Shandong Institute of Light Industry, but they received letters offering them the opportunity to enroll as full-time students in a “pilot program” at RMB 8,000 per year in tuition. The students enrolled, paid their tuition, and attended for four years, only at the last minute to discover that their school in fact had no official connection with the Shandong Institute whatsoever:
As one student told the Jinan Times, “Until now, our teachers all claimed to be from the Shandong Institute. We only just found out they’re not affiliated with the university at all. So now they’re avoiding us, and not answering their phones.”
The fake school was officially set up as a training school on the grounds of the Shandong Institute. It was in charge of its own admission, finances, teaching and administration. Yet the letterheads were fake, and copied from the university itself.
What does this have to do with doing business in China? Everything.
Everything, because if you do not conduct sufficient due diligence there is a good chance you will find yourself at the wrong end of something like the following:
1. Fake China Law Firms. We have on more than one occasion heard of companies that thought they were paying money to a Chinese law firm for something like registering a trademark in China or drafting a manufacturing agreement. Instead, they paid money to somebody that had set up a temporary website with the sole intention of bilking the unwary. I feel compelled to add that I have never heard of a real Chinese lawyer doing this.
2. Fake China Factories. Fake China Seals. Our China lawyers have seen these more times than I can count. The foreign company pays for product from the Chinese factory but the Chinese factory either does not exist, or the person or company to whom the payment is made is not the Chinese factory from whom the buyer thought it was buying the product. I mention the seal because that is oftentimes a good way to figure out who is real and who isn’t. The result is the same in the end. The foreign company pays a lot of money for absolutely nothing and the odds of it ever recovering anything are not good.
For more on China scams and on how to avoid them, check out the following:
- China: Where Even The “Law Firms” Are Fake
- China Scam Week
- The Best Rent-a-Laowai Story You’ve Ever Heard
Here’s the real point of this post and of those I cite to above: 68 Chinese college students were duped into paying tuition to an essentially non-existent entity for four years. That alone ought to tell you how careful you need to be to avoid having something similar happen to you in China. Nobody doing business in China or with China is completely immune.
Verify, verify, verify.
Does anyone disagree?