Fraud Prevention

Mining hardware fraud is a real and persistent problem in this industry. Here’s what to watch for — and how we structure our operations to reduce risk on your side.

Common fraud patterns we see

1. Wire transfer + ghost

Vendor accepts a wire transfer for the full order amount, then disappears. No hardware ships. Recovery is legal, slow, and often unsuccessful when funds have moved through multiple jurisdictions. Mitigation: insist on escrow for first orders. Any reputable reseller will accommodate.

2. Counterfeit / refurbished sold as new

Hardware arrives but is older-generation silicon repackaged in current-generation chassis, or used units sold as new. Performance falls short of spec; warranty refused on inspection.Mitigation: buy from sellers who post manufacturer serial numbers and let you verify with the manufacturer’s online lookup before payment release.

3. “Cloud mining” / hash-rate contracts

You pay for hash rate but never receive physical hardware. Most of these contracts are unprofitable for the buyer by design — the operator captures the spread between paid hash rate and actual production. Mitigation: only buy hardware you can physically locate and inspect. We don’t sell cloud mining for this reason.

4. Unauthorized reseller fraud

Vendor claims authorized-distributor status they don’t have, then collects payment for hardware they can’t actually source. Mitigation: verify any “authorized seller” claim directly with the manufacturer’s regional office. Most manufacturers maintain public lists of legitimate authorized sellers; if a vendor doesn’t appear on it, take the claim with skepticism.

5. Bait-and-switch on lead times

Vendor quotes a 2-week delivery, accepts payment, then “discovers” 3-month delays. By the time you ask for a refund, the market has moved against you. Mitigation: contractual lead-time penalties; partial refund clauses; staged payments tied to milestones (production confirmation, shipment, delivery).

How we structure orders

• Posted prices for every SKU. No quote-shopping, no “DM for price” theatre.
• Escrow on first orders via an independent third-party agent. Funds release on delivery confirmation.
• Documented serial numbers at shipment so you can verify with manufacturer before unboxing.
• Insured freight with declared value matching invoice.
• Plain-English RMA terms on the warranty page.

Red flags on any vendor

Walk away if a vendor:

• Refuses escrow for a first-time order.
• Quotes substantially different prices via DM versus posted.
• Won’t provide serial numbers in advance of payment release.
• Has no physical operating history (search for the company name + “warehouse” / “office” / “address” — if nothing comes up, that’s information).
• Has only Telegram / WhatsApp contact (no business email, no phone, no physical address).
• Pressures fast wire payments with discount-expires-tonight urgency.

If you’ve already been defrauded

Document everything (emails, transaction hashes, wire receipts), report to your local cybercrime unit, and consider chain-analysis services like Chainalysis or TRM Labs for crypto-payment cases. Recovery is rare but not impossible. We’re happy to share what we know about specific vendor patterns if you reach out.