Man exploited e‑commerce “refund‑only” rule to extort over 900 online shops; transaction volume reached ¥10.3m, sentenced to 1 year 6 months

Case and sentence

A man in Jiangyin, Jiangsu, has been sentenced to one year and six months in prison for the crime of disrupting production and business operations (破坏生产经营罪), after reportedly using e‑commerce platforms' “refund‑only” (仅退款) mechanism to extort hundreds of merchants. It has been reported that IT Home (IT之家) covered the case, which quickly became a hot topic on Weibo. The court found that the defendant targeted more than 900 online shops over three years and placed some 2,700 malicious orders.

Modus operandi and impact

Reportedly the scheme followed a three‑step playbook: place a normal order and then claim a refund-only reason such as weight or quality problems; if merchants resisted, file complaints with business regulators alleging practices like “pay‑for‑good reviews”; and, if that failed, use information from business licenses to bulk‑order large quantities across affiliated stores and immediately request unconditional refunds. It has been reported that this manipulation created a transaction流水 of about ¥10.3 million while actual verified direct losses to merchants’ transaction fees were roughly ¥62,000 — not counting logistics, packing and traffic costs. One victim, surnamed Cao (曹先生), paid escalating “settlement” demands to stop the harassment before reporting the attacker; the suspect was arrested in November 2023.

Wider implications

The case exposes an operational loophole: platforms that count refunded transactions toward turnover can be gamed to inflate apparent sales while forcing merchants to absorb pre‑shipment costs and platform fees. It has been reported that six victims paid a total of ¥6,400 in coerced settlements. For small sellers already squeezed by competition and platform policies, the episode raises urgent questions: will marketplaces tighten dispute workflows, change how refunded orders are recorded, or improve merchant protections? Chinese regulators have been stepping up enforcement against e‑commerce fraud in recent years, and this sentence signals authorities’ willingness to treat coordinated extortion as a criminal act rather than a commercial dispute.