As authorized by a Hong Kong enterprise in Dongguan in 2007, we performed 
investigation on credit crisis arising from product loss in their factory. That 
product was produced as authorized by an overseas customer. That product was not 
launched to market in China but similar products were sold at lower price in the 
Chinese market. After product sample verification, the factory certified those 
products were produced by the factory. Since their customer only authorized them 
to produce but didn’t authorize them to sell such products in the Chinese 
market, their customer expressed extreme dissatisfaction about this and issued 
an ultimatum to stop production. If they did not give satisfactory explanation 
about this, their customer would reconsider their cooperation and suspend 
processing order. The production volume from this customer exceeded 2/3 of the 
annual output of the 2000-employee factory, making it a key processing source 
for the factory. Therefore, factory management paid close attention to this and 
decided to find out the truth in an attempt to successfully deal with the credit 
crisis with their customer. 



           

After receiving official authorization from the factory, we established a 
special investigation group who arrived at the factory on the same day in an 
attempt to find out the truth within the shortest possible time and minimize 
their losses. Our investigator performed full check on the internal monitoring 
system and warehouse management system of the factory, and found products and 
semi-finished stored in every corner inside the factory. Though the factory had 
detection equipment to check employee entry and exit, yet such equipment could 
not perform thorough check on incoming and outgoing vehicles. When checking 
material suppliers’ incoming and outgoing trucks, our investigator found the 
driver of one material supplier had close relations with finished product 
warehouse supervisor. Normally, material supplier only handed over materials to 
material warehouse. This exceptional phenomenon attracted attention of our 
investigator. 
After internal investigation in the factory, our investigator began to search 
for low-price sellers in market. Very soon, our investigator found the website 
IP at a rental house in Tianhe District Guangzhou engaged in online sales of 
target products. Through monitoring on the rental house for more than 10 days, 
our investigator found the vehicle of the suspected supplier appeared at the 
doorway of the rental house and the driver went into the rental house with some 
goods. Through investigation, our investigator found a family of three persons 
stayed in the rental house and they sent out express parcels almost every day. 
What were inside the express parcels from the rental house? What goods did the 
material supplier’s driver send to the rental house? Why did the driver have 
close relations with the finished product warehouse supervisor of the factory? 
With these questions in mind, our investigator found some excuse to enter the 
rental house to find out the truth. In the