Vendors punished for sales fraud on tmall.com

The participation of a few vendors in the year's biggest online shopping festival on Alibaba Group Holdings' tmall.com was recently restricted or even revoked, the e-commerce giant said on Tuesday, citing a fake transaction scare.

The festival on November 11, known as Singles' Day in China, saw a total of 27,000 participating vendors this year, Alibaba said in a statement e-mailed to the Global Times on Tuesday.

The company is monitoring data and also conducting manual checks during the festival in a bid to find any fake transactions immediately and any shop caught faking transactions will be punished, according to the statement.

Alibaba didn't reveal either the number or the names of the vendors on the blacklist.

A report on e-commerce news website ebrun.com came out in the wee hours of Tuesday saying that six stores selling shoes, clothes and bags had been kicked out from the tmall.com participating vendor list, quoting unnamed industry sources.

But all of the stores named in the report including aimigao.tmall.com, fallinmiss.tmall.com and bidegaidi.tmall.com still remained on the festival Web pages on Tmall when the Global Times reporter checked at 10 pm on Tuesday.

The fake transactions refer to deal fraud, in which shop owners employ some people to make fake purchases in a bid to make their products look popular by boosting the sales records.

These employed people usually make payments with money provided by shop owners and receive a small extra payment for each deal, while the shop owners will send an empty package to them to complete the false transaction.

With the e-commerce industry booming in China, there are even some small companies that make profits by organizing the unscrupulous activities.

The fake transactions widely exist on e-commerce platforms because of the need for high sales rankings, Lu Zhenwang, founder of Shanghai Wanqing Commerce Consulting, told the Global Times Wednesday.

Items with high sales and good ratings will be placed on the homepages of e-commerce platforms, so the ranking is crucial for sellers, Lu said.

There is no hope for sellers if their products cannot be seen by customers, therefore, once the ranking competition is underway, it is almost impossible to completely eradicate deal fraud, he noted.

Alibaba has adopted more restrictive management measures than last year, but it is hard to detect and put an end to fake transactions, Lin Wenbing, an analyst at Analysys International, told the Global Times Tuesday.

The fake transactions do not only appear during special sales days such as Singles' Day, but are a common phenomenon, Lin said, noting that surging sales at the end of a month or quarter may be attributed to the deal fraud.