Cottage industry of Chinese scammers target TikTok

Mo Huabin struck the jackpot when his company’s videos promoting “enzyme coffee” went viral on TikTok last year.

The clips feature swirling cups of coffee, nodding physicians and faked before-and-after shots of incredible weight loss. Mo’s videos racked up millions of views on TikTok, helping create a gush of orders for his $124 “3 treatment” plan that promised buyers of the drink that they would drop 30 to 60 pounds.

“Weight-loss coffee, aphrodisiac coffee, it’s actually just regular coffee, nothing special,” Mo, who is based in Shenzhen, admitted in an interview with the Financial Times. “I have no idea why it became so popular.”

TikTok’s spiralling use around the globe brought in about $15bn in revenues for Beijing-based parent company ByteDance last year. But its global user base of more than 1bn has attracted a cottage industry of scammers in its home country who have found ways to profit from the global reach of a Chinese group like never before.

They have benefited from TikTok’s hands off approach to policing content and the app’s algorithmically curated feed allowing any video to gain traction.

“I do TikTok to rip people off,” Mo said in a January video posted to Douyin, ByteDance’s short video app for China, where he chronicles his TikTok tactics to gain recognition at home. “My main tool is ecommerce in short videos and livestreams for the Americas.”

Mo told the FT he was joking in the video and that he did not consider selling dubious goods as tricking people. After the FT sent a request for comment flagging Mo’s main Douyin account, ByteDance removed it. Two of his other accounts with similar handles and many of the same tutorials remained online, however.

Some sellers market their goods to people outside China on TikTok Shop, an in-app shopping platform where ByteDance takes a cut of sales. Others such as Mo use TikTok for marketing and direct users to third-party sites to complete the sale, at times paying ByteDance to push their product videos into user feeds as adverts.

Three TikTok employees said cleaning up fraudulent content on the app and monitoring its ballooning number of merchants seemed to have fallen by the wayside amid a frantic push for growth.

On the group’s TikTok Shop ecommerce marketplace for the UK, the FT found multiple accounts selling products violating ByteDance’s guidelines, including weight loss tea and coffee, and prescription drugs such as Tretinoin, an acne medicine, and Hydroquinone, a skin whitening treatment.

“TikTok prioritises profit over the regulation of goods on its platform,” said a senior executive with knowledge of decision-making in ecommerce at the video app.

TikTok said it “has strict policies to protect users from fake, fraudulent, or misleading content, including adverts” and removes content that violates its guidelines including 25 violative or unsupported products from its marketplace flagged by the FT.

ByteDance’s attempts to police its platforms appears in sharp contrast to a heavy-handed approach to censoring any content on Douyin that could displease Chinese officials. Many of the groups targeting TikTok users organise on Douyin where they recruit new sellers and discuss tactics.

“Douyin is committed to cracking down on illicit activities including scam attempts,” said ByteDance, adding it had “removed over a hundred videos with violative content, and suspended a dozen accounts, including the ones flagged by FT.”

Mo said the ability to go viral on TikTok as a new account had offered his group opportunities unavailable on Instagram and YouTube. Getting around the platform rules was “pretty easy”, he said, adding “if accounts are closed we can sometimes get them reactivated or just set up new ones”.

His group’s videos often feature clips of Dr Dana Brems, a Los Angeles-based podiatrist and social media influencer, in an attempt to add credibility to the claims that enzyme coffee can trigger weight loss.

Brems told the FT that the clips are used without her consent and that she flags the weight loss coffee and male enhancement videos through TikTok’s in-app reporting function on a weekly basis, but the system usually finds the videos not in violation of policies.

TikTok’s creator team will help, she added, but it requires lengthy email exchanges to remove even a single video.

“It’s like whack a mole . . . there’s hundreds of accounts,” she said. “Most people will not fall for it but if an account is seen by enough people, eventually some people will buy.”

Some of the scam videos are marked as promotions, meaning people such as Mo paid TikTok to push the clips into user feeds. Brems has taken to uploading her own TikTok videos warning followers of the problem, but the FT still found many TikTok users posting about purchasing the doctor-recommended coffees.

As journalists and doctors began to debunk the enzyme weight loss coffee in articles and videos last year, Mo moved to chronicle his group’s booming sales on Douyin.

“We were the first ones to use doctors, people are calling us the Doctor Group now, it’s hilarious,” he said in an October Douyin post, demonstrating how his team cut together video clips in their Shenzhen offices to post under TikTok handles such as @dr.kara0, dr_merlin and doctor_mccree, among dozens of others.

As TikTok users have begun to catch on, Mo said he has shifted his team’s focus to selling legal goods on ByteDance’s official ecommerce marketplace TikTok Shop opening in the US.

“We see a higher mountain peak ahead, a bigger opportunity, so we’re not only going to be making money selling goods, we’re turning into a company with sustainable operations, logistics and a team of influencers,” he said.