Protect Your Business Against Fraud
• Provide detailed instructions and directions to staff on how to handle suspicious situations
• Alert and pass the word onto local business associates and police agencies, the Attorney General’s Office, the Department of Consumer Protection or the Better Business Bureau.
• Independently verify the legitimacy of any entity that asks you for money or information
2. Are solicitors volunteers or paid telemarketers?
3. What is the organization’s stated purpose? Does it publish an annual report that contains detailed budget information for public review?
4. How much money is being collected on behalf of the organization and how much is going toward the stated purpose?
5. What percentage of contributions goes toward the professional fundraiser’s salaries and other administrative costs?
6. If the solicitor is selling advertising space in a publication, ask to see a copy of the latest issue. When will the next issue be produced? How many copies will be printed? Who will get copies?
official it looks, if you have to pay to receive a free gift, it’s probably not worth the money.
2. Call local suppliers to compare prizes and quality, and ask questions about the quality and restrictions on the prizes.
3. Insist on written information from the caller.
4. Be suspicious of offers that must be acted on immediately or require cash payments.
2. What are the true costs of the venture?
3. Will the seller supply training, management and promotional assistance?
4. Is the seller primarily interested in selling distributorships or in marketing a product or service?
5. How many other investors are involved?
6. How many other distributorships will be sold or are already operating in the area?
7. What profits can be expected or documented by the seller?
Sometimes callers offer free gifts to employees to induce sales; however, accepting the gift may mean other obligations have been accepted as well.
• Products are delivered not as ordered or expected. The supplier then refuses to accept returns or provide refunds.
• No products are ever delivered, and there is no sign of the supplier who has already taken your money.
• An invoice or shipment is sent even though you clearly refused to place an order with the company. The supplier demands payment and threatens to turn your account over to a collection agency or attorney.
2. Instruct employees not to give out information on office machines and copiers, especially when responding to telephone sales solicitations.
3. Check out unfamiliar companies and offers before placing an order. If it sounds too good to be true, it probably is.
4. Keep a list of regularly used vendors as protection against schemers who claim the order is a “renewal.”
5. When you do place an order, ask for confirmation in writing with all conditions clearly spelled out.
6. Compare prices and quality of products with other suppliers.
7. Notify the supplier of unauthorized shipments or invoices immediately in writing. Clearly state that you did not place an order and will not accept delivery.
advertisement or solicitation.
follows its solicitation with a letter threatening credit rating damage is the phony invoice is not paid.
procedures will begin in order to get the money. In Connecticut, it is illegal for a person to tape a conversation without the other party’s consent.
2. Be sure of the organization’s name, address and phone number as well as the solicitor’s name and his or her position with the company. Check records to confirm any claim of past business.
3. Read your mail carefully. Warn employees to be on the alert for any unusual invoices.
4. Check business records to determine if merchandise or services were authorized, ordered and delivered before paying invoices. It may be helpful to have one employee review and approve all invoices.
5. Alert other businesses, and report phony billings to the Better Business Bureau, the Department of Consumer Protection or the Attorney General’s Office.