Alibaba Launches New Policy to Assist Defrauded Buyers
By Ina Steiner
Alibaba is introducing the "Fair Play Fund" this week to help buyers on its B2B marketplace recover some of their funds - up to $1,000 - should they be defrauded by Gold Suppliers based in China. It intends to broaden the fund in the future to include disputes against Global Gold Suppliers.
The Alibaba.com international site has over 11 million registered users and said less than 0.05 percent of them have reported potential fraudulent activity. In 2009, 456 complainants who reported being defrauded by China Gold Suppliers had their claims substantiated; two-thirds of complainants lost less than $1,000 to fraud.
As with other online marketplaces, Alibaba takes no financial or legal responsibility for transactions between buyers and suppliers, but does provide dispute resolution and assistance in compiling documentation and other evidence to resolve business differences.
Alibaba removes and bans suppliers from its marketplaces in cases where a complaint of fraud against a supplier is substantiated, and if the supplier was a member who paid to list, the supplier forfeits the subscription fee. Alibaba will fund the new Fair Play Fund with those forfeited fees.
Alibaba said it would contact customers with eligible 2009 transactions via email this week with detailed instructions. If all complainants complete the process, they will be paid a total of about $250,000. Alibaba will announce a detailed Fair Play Fund application process in mid-April for 2010 complaints.
More information about Alibaba's safety and security policies are located on this page, and a cumulative list of Gold Suppliers that have been banned by Alibaba can be found on this page. Alibaba also has forums for members to share information:
Find Reliable Partners Forum
In this forum, users can share and solicit insight on prospective business partners they have encountered on Alibaba.com.
Report & Verify Fraud Forum
In this forum, users can notify other members about suspicious activity and raise awareness about potentially bad business partners.
About the author:
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to firstname.lastname@example.org.
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