Post by Scambuster on Nov 17, 2009 13:20:53 GMT -5
Avoiding small-business scams
Small business owners may be street savvy, but that doesn’t make them immune to scammers. Some scam artists target small businesses because the owners may be inexperienced, the business has no legal staff or the business may need financial backing.
Here are some common small-business scams and tips on how to avoid them.
Advance fee loan scams
Work-at-home scams
Bills out of the blue
Business identity theft
Advance fee loan scams
The pitch
This scam offers money at reasonable rates. The offer is made either in a newspaper ad, on the Internet or by email. The scammer may ask for up-front money for insurance purposes or to transfer loan funds. Whatever the reason, you'll never see that money again - or the loan money.
The real story
It's illegal in Canada to ask for money up front for a loan. If you're asked to pay up-front before receiving an agreed-on loan, just walk away.
Work-at-home scams
The pitch
A scammer advertises a work-at-home opportunity that pays "big bucks." Sometimes the ads say that all you need is a computer. Or the job involves simply stuffing envelopes or assembly work. You pay for the information or the materials you apparently need, but rather than helping you make money, all you get is useless stuff.
The real story
Never accept one of these offers. They're not profitable - the only people making money on these deals are the scammers. Remember, you never have to send money to get information about a genuine business opportunity.
Bills out of the blue
The pitch
Your business receives a "last chance" invoice for a listing in a "business directory." Or you receive an invoice indicating that an urgent delivery of office supplies is awaiting confirmation of your address.
The real story
Scam operators dupe many businesses into paying for goods and services they haven't ordered. The scammers bet many small business owners and their staff are too busy to check every invoice. Usually, bogus invoices make it appear that services or supplies were ordered and that the invoice hasn't been paid.
What you should do
Carefully examine all invoices, even those under $50. If it's a fake, shred it.
Business identity theft
According to the Better Business Bureau, identity theft is the fastest growing crime in North America. Just as someone can steal your personal identity, your business's identity can be stolen. Once stolen, the thieves can use your business name and financial information to open a bank account and run up expenses.
Take steps to protect your business data:
shred discarded paper, including anything that has your business name on it
be careful when responding to email asking you to do such things as verify your account
be wary about information you give out over the phone
Small business owners may be street savvy, but that doesn’t make them immune to scammers. Some scam artists target small businesses because the owners may be inexperienced, the business has no legal staff or the business may need financial backing.
Here are some common small-business scams and tips on how to avoid them.
Advance fee loan scams
Work-at-home scams
Bills out of the blue
Business identity theft
Advance fee loan scams
The pitch
This scam offers money at reasonable rates. The offer is made either in a newspaper ad, on the Internet or by email. The scammer may ask for up-front money for insurance purposes or to transfer loan funds. Whatever the reason, you'll never see that money again - or the loan money.
The real story
It's illegal in Canada to ask for money up front for a loan. If you're asked to pay up-front before receiving an agreed-on loan, just walk away.
Work-at-home scams
The pitch
A scammer advertises a work-at-home opportunity that pays "big bucks." Sometimes the ads say that all you need is a computer. Or the job involves simply stuffing envelopes or assembly work. You pay for the information or the materials you apparently need, but rather than helping you make money, all you get is useless stuff.
The real story
Never accept one of these offers. They're not profitable - the only people making money on these deals are the scammers. Remember, you never have to send money to get information about a genuine business opportunity.
Bills out of the blue
The pitch
Your business receives a "last chance" invoice for a listing in a "business directory." Or you receive an invoice indicating that an urgent delivery of office supplies is awaiting confirmation of your address.
The real story
Scam operators dupe many businesses into paying for goods and services they haven't ordered. The scammers bet many small business owners and their staff are too busy to check every invoice. Usually, bogus invoices make it appear that services or supplies were ordered and that the invoice hasn't been paid.
What you should do
Carefully examine all invoices, even those under $50. If it's a fake, shred it.
Business identity theft
According to the Better Business Bureau, identity theft is the fastest growing crime in North America. Just as someone can steal your personal identity, your business's identity can be stolen. Once stolen, the thieves can use your business name and financial information to open a bank account and run up expenses.
Take steps to protect your business data:
shred discarded paper, including anything that has your business name on it
be careful when responding to email asking you to do such things as verify your account
be wary about information you give out over the phone