Fakes, Frauds, Imposters, and More: How To Prevent Scams From Harming Your Small Business

For business owners, it’s an unfortunate fact of life – scammers constantly looking to separate you from your money. Your best defense? An informed workforce that can recognize the signs of criminal activities, and shut them down before they do damage. For example, the Federal Trade Commission (FTC) says that scammers often:
  • Seek to gain your trust by displaying some knowledge of your business, to make you believe they’re connected to a familiar person or organization.
  • Try to instill a sense of panic to persuade you something really bad is about to happen, so you send a payment before you can look into their claims.
  • Request payment through methods such as wire transfers, cryptocurrencies, or gift cards that are nearly impossible to reverse or track.
Here is a sampling of some common scams, and actions you can take to prevent them. While far from complete, it will give you a good sense of how scammers operate, so you can stay vigilant and keep your business safe.

Scam: Phony emails, social media messages, or phone calls designed to elicit information such as passwords, customer records, or bank account numbers.
Solution: Make sure employees understand that caller IDs, email addresses and websites are very easy to fake. Instruct them to NEVER open attachments or download files from unexpected emails, or provide confidential data by phone.
Scam: Fake invoices for products and services your business uses, from mundane office supplies to critical services like domain name registrations.
Solution: Have clear procedures for approving invoices. Ensure spending can’t be triggered by an unexpected invoice, and limit the number of people authorized to pay them.
Scam: Messages that purport to be from a well-known tech support company, telling you there is a problem with your computer security.
Solution: Do not engage. They want access to your system and the sensitive data it contains. If you’re concerned there might really be an issue, contact your tech support people right away.
Scam: Credit card processors and equipment lease companies that offer to reduce your costs but are vague on the details.
Solution: Don’t sign any documents until you’ve had a chance to research the company and examine the contract, including the fine print. If any terms are left blank, or the salesperson refuses to provide copies of documents immediately, walk away.
Scam: Check fraud, a broad category that can include forged signatures, altered payee names and dollar amounts, counterfeit checks, and more.
Solution: Enroll your business in Positive Pay, a service that puts you in control to block non-authorized check transactions from posting to your account.
Scam: Delivery of office supplies or other products you did not order – followed by high-pressure demands to pay for them.
Solution: Simply ignore these demands. If you did not order the merchandise, you have the legal right to keep it without paying.
Scam: Imposters from utility companies threatening to cut off service, or from government agencies threatening to impose fines, if you don’t make a payment right away.
Solution: Understand that legitimate organizations don’t work this way. Report the scam to authorities and never be bullied into making a quick decision.

You get the idea. Scams can be high-tech or low-tech, brazen or subtle, and there are plenty more where these come from. Advertising scams. Business coaching scams. Online review scams. As we enter a new age of deepfakes and AI chatbots, you can be sure scammers will find a way to exploit those too. So make sure your staff is aware and vigilant. Encourage them to share suspicious information with co-workers. And before you do business with anyone, the FTC recommends that you search the organization online with the term “scam” or “complaint” to see if anything comes up. To learn more about protecting your small business, visit FTC.gov.