How one disappointing order uncovered a massive ‘ghost cake’ delivery scandal in China
By John Liu
Published on April 22, 2026.
A customer's complaint about a disappointing cake led to a massive investigation into thousands of "ghost" food vendors in China, uncovering a shadow food supply chain that operated with forged food business licenses and no physical storefronts. The investigation, which involved seven major delivery platforms including PDD, Alibaba, ByteDance’s Douyin, Meituan and JD. The State Administration for Market Regulation found that these companies failed to adequately protect customers and properly verify food vendors’ licenses. The regulator imposed a record fine of 3.6 billion yuan ($528 million) - the largest penalty since the amendment of the country’�s food security law in 2015. The scandal highlighted the pitfalls of the cutthroat price competition, known as involution or neijuan in China.
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