The warning follows viral videos showing Chinese visitors being pressured to buy overpriced goods during tours in Thailand, The Nation Thailand reported.
The footage showed a man, believed to be a Chinese guide, telling the tourists they would stop at a tax-free shop, and anyone who did not make a purchase would not be allowed back on the bus, according to Bangkok Post.
On Oct. 15, the embassy said it had taken the matter seriously and had contacted the Thai Tourist Police and the Tourism Authority of Thailand to investigate the incident.
Thai authorities later found the man was a Chinese passport holder without a valid Thai tour-guide license.
He had pressured tourists to buy goods and solicited sales commissions.
Officials have investigated the tour company involved and are moving to take legal action against all parties.
The embassy warns tourists not to be swayed by travel agents with suspiciously low prices.
It urges travelers to choose licensed, reputable outbound tour operators that offer quality services at reasonable prices and provide a formal contract.
Under Thai law, foreign nationals are prohibited from working as tour guides.
An illegal guide could face up to one year in prison and/or a fine of 100,000 baht (US$3,080), while the tour company could be fined up to 50,000 baht and face a license suspension for up to six months.
Thailand has welcomed over 25 million international visitors so far this year, generating more than 1.15 trillion baht in tourism revenue.
China was the second-largest source of visitors, contributing 3.58 million tourists.