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The most common scams against small businesses

I endorse small businesses. I promote them. Now I’m called to protect them.

The Federal Trade Commission (FTC) just released what it calls the 11 most common scams against small businesses. I want to make sure all small businesses, including my #WiseChoices, pin this list up like a Most Wanted poster:

  • FAKE INVOICES. Scammers create phony invoices for office supplies, cleaning equipment or web domain registrations, then mail them to you hoping your company’s bookkeeper cuts them a check.
  • UNORDERED OFFICE SUPPLIES/PRODUCTS. This is different from fake invoices in that the scammer calls your office. They tell whoever answers that they are calling about a supply order and they just need to verify your company’s address, rattling it off right there over the phone. When you or your employee say, “Yes,” the scammer’s recording the response. The scammer uses that affirmative recording as your acknowledgment of a bogus order, then ships the goods along with a bill. Then comes the follow-up call: a high-pressure demand that you pay up or else. The scammer may even play back the recording of you or your employee saying, “Yes.” Always verify your connection with the alleged vendor first, then verify your company actually ordered the supplies in the first place.
  • DIRECTORY LISTING & ADVERTISING SCAMS. Scammers call or mail your company, trying to collect on a non-existent ad campaign or marketing order. They typically pose as the Yellow Pages.
  • UTILITY COMPANY IMPOSTER SCAMS. These are particularly prevalent in Memphis. Scammers posing as MLGW or your local utility generate an unsolicited call to your company, claiming your power bill is thousands of dollars overdue. You must pay now over the phone with a credit card or bank account number or else “MLGW” will shut your business’s power off. Remember: no legitimate utility will ever initiate an unsolicited call to collect a debt. Hang up, then call to your utility company directly to inquire about the billing status of your commercial account.
  • GOVERNMENT AGENCY IMPOSTOR SCAMS. The scammers pose as representatives of government agencies, threatening to suspend your corporate or business licenses or shut down your company if you don’t make some sort of payment or share some sort of financial information. Remember: no government agency — at any level of government — will ever initiate a phone call like that.
  • TECH SUPPORT SCAMS. Just like how they target consumers (read this #WiseWarning), tech support scams will solicit small businesses, too. If your IT team isn’t on the ball, it’ll let these scams worm right into your corporate computer network.
  • SOCIAL ENGINEERING, PHISHING & RANSOMWARE. “It often starts with a phishing email, social media contact, or a call that seems to come from a trusted source, such as a supervisor or other senior employee, but creates urgency or fear,” wrote the FTC in this small business safety guide. “Scammers tell employees to wire money or provide access to sensitive company information. Other emails may look like routine password update requests or other automated messages, but are actually attempts to steal your information. Scammers also can use malware to lock organizations’ files and hold them for ransom.”
  • BUSINESS PROMOTION & COACHING SCAMS. Using make-believe seminars or fake videos, these lure your company into biting on bogus promotions or marketing services. Trust and verify, especially if they solicit your company first.
  • CHANGING ONLINE REVIEWS. This is when someone approaches your company with the offer to alter negative online reviews about your business or to generate positive ones for your company. Do you really want someone playing games with your company’s reputation — for better or worse?
  • CREDIT CARD PROCESSING & LEASING SCAMS. I conducted an investigation in which a Bartlett, Tennessee, businessman pulled this very scam. His family and friends thought he was in real estate. He was really crafting fake leases for computer equipment, then billing his targets for the leases and for the non-existent services and products named in those leases. By the time my stories got the attention of federal agents and prosecutors, the man had racked up more than 50 victims, including two corporations.
  • FAKE CHECK SCAMS. The scammer either overpays or offers to overpay for your company’s service with a check, cashier’s check or money order, asking you to wire the extra money to a third party or back to the scammer. They explain the overpayment approach, saying they’re out of the country and need you to cover the taxes or fees, whatever. The payment is fake. It’s counterfeit. You deposit the check, it bounces, but not before you’ve sent that extra money (real money) right out of your corporate account back to the scammer or to his “third-party.”

Copyright 2018 Wise Choices TM. All rights reserved.


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